Can we survive on £500?

[Ozster]

We are looking to move into catchment area for DD secondary school but it would mean taking on a much bigger mortgage (no surprise there!)

I've worked out that after ALL expenditures (mortgage,bills,petrol,food,kids clubs,childcare) we will have £500 left.

This £500 would be for days out/saving/emergencies.

I know it's not a lot but do you think I could make it work for a couple of years ?
I am at the beginning of my new career so my salary will increase each year.

I was thinking maybe £100 for days out etc and £400 save for emergencies?

Any tips and tricks ?

I make sure that I have an emergency fund, birthday’s and Christmas fun, holiday fun and a car/house fund. I keep them topped up.

Our backgrounds sound very similar op and I couldn’t go back to living how I was.

We probably have about £600 left over after mortgage, bills, weekly shop, children’s savings and childcare but it soon goes. Youngest will be starting at preschool 1.5 days a week, this will be in addition to childminders fees, this extra cost is making us feel skint but the childminder is too valuable long term to let go and the pre-school is amazing so worth the short term cost for her development.

Be wary of interest rates on your mortgage, on current rates we’ve just fixed knocking 8 years off the previous term and paying less than we were on our last 5 year fix (taken out in 2014 about 5% interest rate) if rates go up, your mortgage could easily swallow that £500 surplus. We’ve just fixed again for 5 years at a super low rate however the cost of childcare atm should offset any rate rises in the future. We have plenty we could cut back on if we needed to and wiggle room with the mortgage, we didn’t max out borrowing and could up the term if we needed extra breathing space. When we first moved here it was a huge jump from our first home, tripled the mortgage. It now seems tiny in comparison to friends who have bought in the last couple of years but think carefully about what you can actually afford with your current lifestyle, Money Advice Service have an income and expenditure form which is helpful, it acknowledges all outgoings, I had a play with it and it reminded me of things like takeaways, pet insurance or hair and nails that you might not factor in as a fixed or essential cost but contribute to your monthly spending.

@Ozster like I say, I didn’t mean you specifically and I don’t think your thread is particularly goady, but I do think some are guilty of that.

Apologies if that was a bit nasty, I probably got up too early!

You are doing well, you should be proud of your achievements.

For a couple of years? Why does it get better after that?

Could you buy a house that needs work and. It do it all at once, save some for when you have more money?
Or cut back on some luxuries to give yourself time to build up a bit more of a buffer?
Or maybe if your boiler breaks you have to take out a £3k loan and then cut back to pay it back.

It sounds ok. We’ve been in a mixture of situations and are quite risk averse, our income isn’t always stable.

If you really have £500 left over each month then yes, it's perfectly doable.

However, are you sure you have accounted for everything? I did my budget recently and couldn't understand why I had less each month left over than the spreadsheet working showed. Then I realised that although I'd put in all the obvious stuff - car insurance, food, clothes, gym fees etc (dh pays the utility bills) I hadn't put in lots of stuff like all my direct debits to charity, my union subs, my political party membership and they added up to over £150 per month.

I think that is much, much more than most families have, as many have already said, and i don't know why, therefore, you are saying it will be 'tight'. I am sorry you have experienced poverty before and this will no doubt make you feel nervous about struggling again, but surely having 500 extra a month us a long long way from where you were then. To your question yes, it will be totslly doable.

If you’re nervous about it, just make sure you prioritise the ‘emergency fund’ rather than the luxuries. Then if something does go wrong such as a boiler or car issue, you know you’ll be fine.

If £400 is really just going into savings then surely you must recognise you’re doing significantly better than many.

If you have to use that £400 for any of the following then be really honest about how much you currently spend and then see what’s left over:

Haircuts
Coffees out
Parking
Club subscriptions and sports activities
Christmas
Day trips/holidays
School uniform
New clothes
Servicing the car
Music lesson
Window cleaner
Takeaways
Birthday presents
Makeup and toiletries
New clothes

Many of the above you don’t need but if you’ve become used to them then you’re going to feel the pinch when you lose them/ take them out of your £100 pcm.

It depends, have you been realistic with your outgoings. Lots of people forget the multitude of little outgoings that crop up
Exactly that. I spend between £200 and £250 a month on things I haven't featured in my budget because they are one offs or things I hadn't expected.

Then you should know better than to refer to your disposable income as a matter of "survival".

Perhaps try saving £450 of it every month and never touch it, then live off of the £50 left over. That will give you a much clearer insight into why there threads are disappointing for people to see popping up.

I understand £500 is a lot to some and there are people way worse off then me and are struggling .

I'm not gloating , I just want to make a well informed decision rather than jumping into and then finding myself in a bad situation where money is tight and barely covers living.

I've seen a trend I'm MM now where if anyone if a 'high earner ' or has 'a lot' of disposable income they get absolutely trashed ?! Both these things are subjective, what is a lot of £ to me might be pennies to someone else

People, including me , are working hard for the money we earn.

Like I've said , I was in a bad position a year ago but went back into full time education, whilst working 3 jobs AND raising 2 children to change my situation

I am so sorry if my £500 has offended you but I have earned every penny of it.

I agree with the comments about being really sure you have budgeted everything you usually spend. If you are used to a higher level of disposable income it is astonishing how things just leak away if you don't keep an eye on them. Taking a drop in disposable income is always a challenge even if the amount you have seems like a lot to others. It's not a huge amount if you are looking to build safety nets etc. I've had high and low disposable incomes and transitioning from one to the other is tough. Good luck!

Ignore the 'people are living off dust don't you know' comments. Personally no I wouldn't be comfortable with that but that's just cause I guess like you, I want to be super careful for the unexpected shit that life throws at you. You could get a car service costing £1000 and that is 2 months of non bill money gone etc

£500 would make me nervous tbh. No matter how much I budget I always go over what I was expecting.

Kids clothes
Lunch out with friends ( can’t do that now)
Coffee from the coffee van whilst I’m out walking.
Bowling with the kids as it’s raining
Play area visits
New coat for dc
New shoes for dc
New tights for dc
Dd1 ripped the door handle off the washing machine
Extra movies on sky as nothing on tv ( dh when I’ve gone to bed)
Extra movies on sky as it’s cheaper than the cinema ( dh allowing kids to take the piss)
Arts and craft because the bloody school as already told them to make their Christmas cards
Parking fine 😬
DB asked to lend some money
Car insurance went up

Those were just last months add ons that I’d not budgeted for. I do put money away to save but I don’t count that as available money. I swear every month I think some one has stolen money out of my account untill I go through it.

If I wasn’t able to save and only had £500 I’d panic.

If you’re able to put £400 in your savings each month then this is not about “survival”. Survival is where there are no savings and pretty much every penny has to be budgeted for.

Exactly.

This is what's wrong with threads like this. Of course, you can survive. It's about priorities for you, unlike people for whom £500 is all there is for rent and everything else. This is all for getting into a catchment area, which is fine. When you make these choices, often something else will have to go. It's about deciding whether it is the right choice for your family and then live with it.

Jesus wept. Sorry but if you've previously been "in poverty" as you state, then I'm pretty sure you wouldn't think that £500 surplus cash a month was too little to live off.

Also, please don't talk about how you work hard for what you earn. Some of the hardest workers I know are on minimum wage (me included). Hard work does not equal good wages. Loads of people work their arses off for sod all.

@Ridiculousradish is correct working hard does not always equal fantastic salary for many reasons .
I'm a single parent who has always worked full time and sometimes had 2 jobs. But after my rent is paid I have £250 of my wages left to pay everything else. I work my arse off.

People, including me , are working hard for the money we earn

That's completely irrelevant to your question. And if you have, as you claim, been poor you understand extremely well that £500 spare cash is not survival money and you understand how to budget. That just makes your post seem even more goady.

"I am so sorry if my £500 has offended you but I have earned every penny of it."

Can you direct me to where anybody has said you didn't earn it?

Are you genuinely saying that when you were living hand to mouth, you wouldn't have minded one bit if a friend of yours was telling you how worried they were after 'only' having £500 left after all bills and food were paid for?

To be honest with you I think these threads should be deleted on principal. They're so insensitive and the OPs always get so defensive instead of just accepting that they made a mistake.

@grapevine I admit: 'survive' was the wrong word to use and insensitive . I should have put more thought into it.

@IndieTara But it's true? I work hard for what I earn. That doesn't mean people who don't have £500 spare don't work hard.
It just means that for me to have that I work hard.

And yes if my FRIEND knew my difficult position and told me about her £500 I WOULD mind.

But on MM I am looking for people who are/were in similar situations and how they made it work for them.

Removing threads like the is preposterous!
What about your neighbour who might be driving a Land Rover and seem to have 'loads of spare cash ?! Remove them too ?

MM is to share experiences and get tips and advice on ALL matters for ALL ppl. Whether it is someone who needs advice on how to budget with £50 or someone who wants to know what private school to send the child to

Yes you can do it. Especially if you go for cheaper days out, like picnics, walks, cycling and so on.

Is either of you at risk of losing their job? To me whether you would be able to survive on only one wage for a while would be the deciding factor.

I’m glad you’ve retracted the I’ll judged “survive”

Presumably your daughter is Y5? As Y6 applications are almost closed.

In that case, you have the chance to live off the new outgoings for a while - even 6 months would net you £2400 in your emergency fund (which is enough for boiler repair, or a new car, or multiple white goods...) and show you before you make the move that you can.

What length mortgage do you have now, and what would you be prepared to change to? If you went from say 20 years now to 30 years you could still overpay or remortgage down to the original number of years as your salary increases.

Does your DD really need to be in a different catchment?