Has anyone who’s been crap at money changer it around later in life, and how?

[Sickonomoneyyy]

Has anyone who’s been crap at money changer it around later in life, and how?

im late thirties and always struggled to budget, payday millionaire etc and I’m sick of it! I just don’t know a way out! Nothing seems to work

@BarbaraofSeville thank you part of my job is supporting people to budget and priority spending. I used to manage rent payments and the excuses for non payment were often from poor prioritising. Although I understand life events and lack of income are an issue too.

I think comparing yourself to others and feeling you are entitled to certain things like expensive hair, nails, gadgets, holidays etc are an issue too.

You have to work out what is realistic and make peace with what isn’t. Those friends or family spending tons probably can’t actually afford it either and you do not need to keep up with it.

I can afford to get my hair coloured at salon now but I upkeep it at home so only fork out once every 9mths.

I can’t afford foreign holidays or centreparcs so camping , caravans and occasionally butlins happen.

I can afford the car loan for a very basic PCP ( it’s better than the maintenance I spent on a very old car) but I can’t afford to drive what I’d love to!

I can afford a meal out with friends occasionally but I can’t afford starters, dessert and cocktails! I also can’t afford the £25 steak option!

I am now off to check my bank balance! Payday Friday and checking all has been paid. Need to book tyres in. Might actually be able to afford it based on what’s left and not what’s coming which is a nice feeling.

That Friday coming not yesterday.

I set up a separate account purely for direct debits.
So the day after payday, standing orders take money out of my spending account into the direct debit account for bills & also into 5 different savings accounts: contingency, annual expenses, holidays, Christmas & birthdays and miscellaneous savings. That then left the money I actually had to spend that month in my account. It hasn’t cured me of my overspending ways (I tend to spend the same £20 3 different ways and it’s easier when I have no money to spend!) but it has helped limit the issue and help me get some savings too. Recognising the issue is the hardest step - it really is - and you’ve done that.

This was me! The budgeting app YNAB (You Need A Budget) absolutely changed my life. I went from constantly being overdrawn to having savings and forecasting ahead for things so i have the money sitting in my account ready. It's a one off payment a year, which isn't cheap, around 75 pounds, but worth every penny for me. I've been doing it for the last 3 years. It's tricky to start, but worth working it out. I will never stop using it.

Yes, had several CCJ's and lots of debt for twenties and thirties. Struggled to get on top of it and loved month to month. Biggest change which helped was putting every single bill in direct debit. And all banking on mobile apps. Took weeks to go through and find all paperwork to do this but now it is done I have gradually all debt over the years, no borrowing except mortgage and way less stress. Finding the paperwork and information in my massive disorganised house was the main challenge for me. Also I found a good therapist and my mental health improved which helped me take some actual steps to improve things.

I would recommend the CAP Money course for a free step by step guide to budgeting. I think it is helpful that the course is over a few weeks because it gives you time to reflect and make decisions. You don't share your finances with anyone in the group but it's helpful to hear money saving ideas from others.

The starting point is writing a list of direct debits. And adding them up and working what is left.

I was really bad lived from month to month, credit cards and loans. Not much in each but enough. Turned it around with a budget. It's quite satisfying saving when you get used to it. I also predicted likely out of pocket expenses eg dh birthday, Christmas. half term, etc.

have At least Three bank accounts is key
1 bills account (main bank)
2 spending account (starling or monzo are good)
3 savings account (I have two one to spend over the year on big ticket stuff and one for nest egg)

I Do a budget of things i need in the next month and other additional things in three months - including EVERTHING from hair cuts to window cleaning to holidays, gifts, medicine, dentist, clubs, nails, gym, socialising, garden, home.
Pets etc school trips.
I save £600 for Xmas by October. £ 15 a month for our dog. £25 a month for gifts.

The big ones Food -bills- cars -housing.
Now factor in Christmas and holidays

Then I saved a £1000 emergency fund so I never needed to. Put a car repair in a credit card or a vet bill on one too.

Then start paying any debt, smallest first (Dave Ramsey a snowball method)

In the first of the month I have a direct debit of spending money to the starling account (whatever you need mines 530). leave only enough for direct debits in the main accounts (most banks tell you this). Transfer the rest to savings. Pay day is irrelevant as it all should tick over.

In the startling I have pots for pets, trips, clothes, gifts hair etc

sorry to jump on this but I have a question. What comes under saving? I have pots for holidays, contingency, treats and goals for example- are they counted as savings or is that budgeting?
Is savings a long term don't touch type of thing?

Another vote for YNAB. Changed my life. Gives me visibility on what I’m spending or saving and can make informed choices. Pre YNAB was all over the place. They have lots of tutorials and stuff too. I can’t imagine the financial anxiety I would be going through without it, especially as me and OH have uncertain income atm.

It sounds like an addiction, like you get a “high” from spending the money quickly once it’s in your account. You need to find an alternative way, that’s healthier, of getting that dopamine hit (that doesn’t involve £, or food). The easiest way to get that dopamine rush is exercise…

Reading an article by a financial expert who said you should treat household fonances as if you were running a small business made me think, I purchased YNAB4 and it transformed my financial life. Sadly it stopped working after years of use but it taught me how to use an envelope budgeting system.

All incomings and bills are dealt with in one account, I have a spending money current account, a prepaid cashback credit card for groceries and savings account for specific purposes.

I keep on top of it all with a combination of spreadsheets and Moneyspire budgeting software. It isn't as complicated as it sounds and it means over the years I've gone from vast amounts of debt to £50k of savings.

It's almost a bit of a hobby, looking for new accounts, working out when I can retire etc. It's definitely worth putting time and effort in where money is concerned.

I did the free trial on ynab but then refused to pay for it- odd way to get out of debt!

I use the principles of giving every pound a job- I do that by using the app Fudget for a rolling budget, then use Monzo and Starling to separate bills and save things into pot/spaces.

This kept happening to me years ago.
The things that have helped are moving all bills to two days after payday.
Working out how much I have left and budgeting for what I need each week.
Putting some money aside in another bank.
It is in only £50 and I usually transfer it back in by the end of the month, but I have to really make an effort to do that and mentally ,I know'that is all I have '
Looking carefully at all my bills to see if they can be reduced.
Always taking packed lunches to work.(lunch at my place is only £2.50-but even that adds up!)

YNAB was game changing for me. You don't necessarily need the software, you can do the method on paper or on a spreadsheet and there are free/cheaper alternatives, but it works best for me due to being able to go back and cross check with bank so if I get behind I don't have a giant mess to clean up.

I didn't think it would save me more than it costs but it absolutely has, so worth it for me.

The first budget I ever did was MoneySavingExpert. Their budgeting tools are completely free.

Both MSE and YNAB have a very helpful idea of looking at the whole year rather than just a month at a time. Before, I would tend to think of my costs as being the things that happen every month or at most every quarter - rent, food, utilities etc. I wouldn't think of things like clothing, or yearly expenses like Christmas, as being things that I needed to budget for and then when I had to spend out on these things, it was always a surprise/struggle. It also gave me an unrealistic idea of how much spare money I had left over. So it was pretty helpful to actually allocate money to things that I had previously thought of as just all coming out of the leftover money which would cause problems when I tried to spend the same leftover money multiple times over. I would also unhelpfully think to myself "Oh but December wasn't a normal month because it was Christmas. Oh but March wasn't a normal month because the car needed repairs." There is no such thing as a normal month and Christmas/car maintenance are not completely unexpected expenses - you can plan for them and be ready for them. This was somewhat of a revelation for me. I think because my mum was always skint so she didn't have pots saved up for this kind of thing and my grandparents would bail her out. I thought I was good with money, because I had adopted her habits of buying only as much as I need, avoiding marketing tactics, waiting to see if I really need/want something before buying, etc. But I had no idea of saving for planned expenses or saving for a rainy day, and therefore those things would trip me up.

It can be quite depressing/eye opening if you go through and realise that your real monthly costs are actually more than you make, but at least it's helpful information and a starting point so you can cut things out and/or look at increasing or topping up income longer term. I always took it for granted that I made little money and assumed I couldn't possibly make more but it is often possible to look at long term options and make changes.

How hard can it be though?

All it comes down to is 1) having the knowledge - knowing your income and outgoings to create a simple monthly budget plan. And think beyond just the month, many of us pay for sone things annually so factor them in, know when they're coming up and plan to have the money ti pay them.

And then the application of said knowledge by 2) only buying stuff that fits into your budget plan.

If you've not got the knowledge, invest time looking at your own bank statements.

If you do have the knowledge but choose to ignore it, then I don't know what advice to offer because that's just being wilfully counterproductive against yourself.

@Saltovinegar if you wanted to carry on with YNAB4 there is a good YNAB reddit community with plenty of people still using it on there, they can probably help you get it running again.

There’s always one…..

Thanks I'll have a look. Loved YNAB4 but not so keen on the new version.