Mortgage vs Salary

[propertyquery]

I'm interested to know if you all think I am in a dead end financial situation. And whether I should sell my house and try to find something cheaper or if I should be able to live ok on my salary.

I bought a house 3 years ago, putting all my savings down as the deposit.

My mortgage is £1,400 per month. My net salary after tax etc is £3,300.

Bills for energy, broadband, insurance, council tax etc come to about £1,000 per month.

There's nothing I can cut or reduce within my monthly direct debits (I don't have any gym memberships or anything like that).

Travel and food use up the remainder of my salary each month.

I have no debt except my mortgage.

I'm single, no children or dependents, yet I really struggle.

I never take holidays or buy much in the way of clothes.

I have a dog which seems to bring never ending costs - vet bills, grooming, food. But he's one of the few pleasures in life so he's worth every penny.

Do you think my mortgage payment disproportionately high compared to my salary or should I be able to live ok on this salary with this mortgage?

Can you give us a breakdown of your bills, please, as £1000 a month sounds a little high to me.

How many bedrooms do you have? Can you rent any out to bring in more income?

You shouldn't be 'really struggling' on £2100 after mortgage for just you and your dog,which suggests that you do have scope to cut down.

How much is your broadband and mobile? You should be able to get both of these for £25-30 pm total.

How much do you spend on food? Do you buy coffee, lunches, takeaways?

What's your travel cost, do you have car finance, how far are you from work or anywhere else you need to go to regularly.

A good rule of thumb is no more than 1/3 of take home pay to be spent on housing.

By that metric, you are paying more than you should.

Sorry I now see its £1900 after mortgage but my point still stands. You'll probably find that you're spending more than necessary in some areas and there's scope to cut down to make your money go further.

I have seen that metric, but IME it doesn’t apply to those who are in the first 10 or so years of a mortgage; it didn’t apply when I bought my first flat in 1988 either.

So, Op, assuming you are on a repayment, it should get easier. After 3 years , are you able to check out better mortgage deals?

Are you in a job where you may expect to be promoted at all ?

Before you sell up, look at all the moving costs, stamp duty etc.

Your dog is your expensive hobby - trust me , no criticism - I have 2, and it’s scary how the costs add up. Have a look at things like his insurance and and meds or treatments - don’t go without- but is there a cheaper way to get those? Is there a cheaper source of his food?

I’m sorry, you should expect to have a good lifestyle on those figures, but life is very expensive these days.

Thanks everyone. I'm doing some forensic analysis of my monthly spending today so hopefully will find some areas to cut down.

"How much is your broadband and mobile? You should be able to get both of these for £25-30 pm total."

I'm paying nearly £50 per month for broadband from BT and another nearly £50 per month for my iphone. Is it really possible to get both these things for less than £30 per month? My phone is due for renewal in August but I will need a new phone as well as a new contact as the current one is smashed and pretty old now.

It doesn't really matter what we think, does it? Either you think living in your current house is worth it to have less money for holidays, clothes, meals out etc, or you think you'd prefer to live somewhere cheaper and have more money for that sort of stuff.

There's no right answer, it's your personal preference.

Yes I get that. Im just wondering if it is likely to get any easier. I don't want to feel like this for the next 20 years.

A breakdown of your bills would be helpful.

One suggestion would be to buy a second hand iPhone outright and then get a sim only contract.

What's the breakdown of your bills? They sound extremely high for a 1-person household.

How much is the 'travel' bit in 'travel and food'?

Is your mortgage on a fixed rate that is likely to go up considerably when you next fix?

What size/type of house do you live in, and are cheaper (dog-friendly) properties actually available in the area/a suitable area?

I've just switched from BT to Vodafone for full fibre broadband and it's under £25 pm plus some Quidco cashback and bill credit to reduce the cost a little further.

https://www.moneysavingexpert.com/compare-broadband-deals/

You can get SIM only mobile for a fiver or so a month.

https://www.moneysavingexpert.com/cheap-mobile-finder/sim-only/

For mobiles, I tend to look out for a deal on an Android phone so it costs around £100-150 and replace it every 3 years ish. I also sell my old phones on ebay and usually get about £50 for them so the total monthly cost for a mobile service is fairly minimal, around £10 a month tops. £50 is ridiculous if you're feeling like you're short of money.

Moneysaving Expert will help you review your budget and get everything at the best price to make your money go further.

https://www.moneysavingexpert.com/family/money-help/

Also get the weekly email for ongoing tips like swapping your bank account for free money. I've made a few hundred pounds doing this. That would pay for you a holiday.

Yes. You can get deals for around 25 for broadband and a giffgaff sim in your phone around £10 a month. Buy a cheap second hand Android not an iPhone (or repair your current) and buy as a one off not included in your monthly charge.

Think we'll need to see a breakdown of bills to truly understand the situation, they seem very high for 1 person.

Take a look at YNAB for excellent budgeting skills. It's transformed many a MN'ers financial life including mine.

Yes it will get easier as your wage increases. But beware interest rate increases on your mortgage.

Can you get a lodger? Even for a couple of years. Use income to overpay your mortgage as much as possible if you can, or gets some emergency savings in place.

Get forensic on each of your bills. Beware sneaky subscriptions - cancel everything you don't need. YNAB helps see exactly what you are spending on each month

Make lunches. I often have leftovers for lunch - just cook a bit more dinner.

Yes! I pay £17 for my broadband (virgin media 100gb) and £10.45 for my mobile sim

Run comparison deals on broadband etc as BT are likely to match it when you go to leave. Virgin reduced mine to below all competitors prices when I started to switch to Vodafone.

£1,000 per month on all bills is a lot. I bet there are significant savings you can make on that. Post a breakdown here and you will get help.

My phone is due for renewal in August but I will need a new phone as well as a new contact as the current one is smashed and pretty old now

This is part of the mindset you need to change. No one 'needs' to sign up to pay £50 a month for 18 months, for a brand new iPhone 246 or whatever they're up to. Doing so when you're on a budget is crazy.

You can get an excellent, refurbished, iPhone 12 on Amazon Renewed for £200. Looks and acts brand new. Then a sim only contract for about £7 a month or good old fashioned PAYG bundle for a tenner a month.

So £100 a month is broadband and phone (as others have said you're paying way over the odds). How can council tax (assume you're claiming the single person discount?), energy and water cost £900 a month?

Have you got space for a lodger?

This kind of thing is always a red flag to me. Husband and I have had iPhones since forever - I usually have his old one when he gets a new one as I don’t really care and just want to pay rental, he likes new tech.
we've never smashed a phone. Regular cases and some care. In some cases when I’ve not wanted an upgrade he’s sold his for virtually new because it’s untouched. Chances are you’re wasting a lot of money elsewhere.

I assume you pay for dog daycare or regular walkers to come in if you’re out at work all day - dogs are a significant expense. On a single income you are going to be stretched.

Get a lodger!

Another one wondering how your "bills" are £1k/month for a single person?🤔
Seems way over the top so unless you are including other cost, you need to start shopping around.

A breakdown of your bills would help so people could point out where savings can go made but I think many of these have already been made.
Are you claiming single person discount on your council tax?
How much is your BB, anything more than £30-35 for full fibre means a saving can be made?
A SIM only deal will get your mobile cost to under £10/month. Do you NEED a new iPhone (I don't and more do many others)?
If you are on a water meter then you water & drainage should not be more than about £25/month and if you are not on a meter, get changed over to one now.
Are you paying for actual G&E use or estimates, have you built up any credit?
How much is your B&C insurance, you should be able to get full cover for under £250/year?

Of course it gets better.
Your earning power will increase but your mortgage will remain the same (interest rates aside) meaning that as time goes on, your mortgage takes a smaller % of your earnings.

If your phone screen is broken, just replace it. Your phone should last about 5 years.

Make sure you shut it down every now and then. This will help it there’s any lag.

Get tempered glass screen protectors. £10 for 3 of them.