Disposable income, family of 4, Surrey…

[fameo]

What would you say is a manageable disposable income for a family of 4 living in Surrey? This is money for food, fuel, going out, shopping & extras. Everything excluding bills.

It's hard to say. I factor food into our monthly budget because eating has to happen. We're a family of 4 (in Surrey) and I budget £600. This includes all lunches for school and work. Extra treats come under spare disposable income. Not including food - days out, take aways, clothes, birthdays I budget around £250. Fuel is also budgeted for not in our disposable income because we need it to get kids where they need to be and for work.

To simplify we have around £1600 extra after all bills, savings/pensions and necessary spends are acounted for. If we spend say 400 because we've had a busy month with extra parties or days out the excess gets put into our pension, savings or we over pay the mortgage. Every penny is utilised by months end somehow.

I'd start by looking at what you would like to spend your money on and then seeing what typical budget you would need to cover that. Also what position are you coming from? You might find that you have different ideas if you are in a situation where your income is less than previously Vs now having more income? Age and interests of interest of the children factor in too.

I'm not in the SE but food and fuel is covered by our regular spending. We have enough flex in that budget that semi regular cheap days out are covered - lunch out at a lowish cost activity sort of thing. Infrequent more expensive days out can often be accommodated too. We don't consciously keep an eye on budget and costs but we spent a long time living as student or on low pay as it took both of us 10 years to qualify and some habits are hard to break which means we generally have disposable income for what we want should be decide what we want without having to conscious decide what that budget it is.

That's a real 'how long is a piece of string' question that also depends on your priorities, income and how comprehensive your 'bills' budget is.

Have you accounted for all annual/irregular essential costs such as insurance, Christmas, car servicing? Is that already in bills or would it come out of 'disposable'? What about things like holidays? Are you counting savings as a bill or would you need to save from your disposable income?

You'll get a huge range of answers from people who say they live comfortably on under £1k pm to those who have several times that amount and claim they struggle. You really have to look at the money you have and make it work best for your family.

As a pp says what are you including in this?

In addition to the essential mortgage/bills/utilities I have;

Food and household (combine these as I buy all my toiletries and pharmacy bits and cleaning products in my weekly online shop) - £600. You can easily spend a lot more particularly if you are giving DC money for school lunches every day.
Fun money, 3 separate pots - £125 for me, £125 for DH and £150 for family spends
Kids activities - £200 as our kids do a fair bit
Petrol/travel - £120 as we WFH a fair bit and also don’t have long commutes but we do use petrol getting to activities at the weekends and visiting family)
Haircuts - £40 average spend a month for me and DH, I dye mine at home and also cut the kids hair myself. I have friends who spend upwards of £100 a visit on highlights etc. I don’t get my nails/eyebrows done etc.
Clothes - average £100 a month but not every month if that makes sense. I might spend in the sales every few months or so. Most of this seems to go on shoes, almost everything else I buy on Vinted.
Any subscriptions - TV, Netflix, Prime,
Spotify etc I allow for £20 so we rotate and don’t have them all at the same time
Charity donations DDs
I also have a “slush fund” which is for things that are roughly monthly but not the same every month eg £20 for gifts for kids friends parties

Then for everything else I do sinking funds to save throughout the year, including holidays (however much you want to spend on a holiday divided by 12), car costs (£200 a month to insure, tax and run two family cars), birthdays and Christmas (£125 a month). It depends if you include these in your budget - you say “everything except bills” so I assume you do.

Some of the above categories will vary depending on where you live in the country but most of them are just down to lifestyle choices. I also live in the south east but regularly visit family in the north Midlands and think that cafes/pubs are more expensive here than there, as well as kids activities and things like kids birthday parties. Hair/nail salons are pricier and so are various services if you pay for those things like childcare, cleaners, window cleaners, gardeners. A coffee out is often £4 now, same for a cake, so if you like to take kids out at the weekends then stuff like this adds up. But it just depends on your choices really, and how often you want to be able to do things. Not sure if you’re moving from abroad or how old your kids are but friends do often suggest things like meeting up at softplay which can be over £10 per child at some places. Personally although we are on comfortable incomes we really watch what we spend on stuff like this as it would very easily add up and we consciously limit our spending to stick to the numbers above, particularly in the “fun money” category.

It depends how you want to live. And what you can afford. For us, to live the life we enjoy, the total is around £3500 but obviously if we earned less it would be less and we would do less. Approx breakdown is:

Food shop over a month: £500

School and work lunches for 4 (nobody wfh): £100

Take always and meals/drinks/coffees out as family or individually with friends: £300

Clothes, hair dressing, nails, make-up across all of us etc: £300 (depends on age and gender of kids - teen girls are generally more expensive here than 5 year old boys!)

Activities after school, music, sports clubs, tutoring: £200

gym membership x4: £200

saving pot contribution for two annual family holidays: £1250

petrol: £120

days out, cinema, theatre: £300

saving pot contribution for Christmas and birthdays: £120

saving pot contribution for emergency calls on money life of boiler breaks or we get a big pet bill: £100

total: £3500

£1200

Depends on your housing situation and if you own, have large mortgage, rent or council house. For everything else I would think about 2K for food, clubs, gym, going out and hairdressers etc.

This is our income and budget and we manage well on this.

Me 3100
DP 4100
CB 280
Total 7480
Housing
Mortgage: 1900.
Insurances(life, house): 150
Total Housing: 2050
Utilities
Electricity 150
Waste collection: 30
Broadband & TV: 70
Mobile phones x3: 60
Total Utilities: 310
Food & Groceries
Groceries & household food: 500
Dining out / takeaways: 200
Total Food: 700
Transportation
Fuel: 250
Car insurance & tax: 150
Maintenance & NCT: 100
Public transport / Parking: 20
Total Transport: 520
Education & Kids
School books, uniforms, fees: 50
Activities, sports, clubs: 50
Pocket money/treats: 60
Total Kids & Education: 160
Entertainment & Lifestyle
Family outings, hobbies, gifts: 200
Subscriptions, books, etc.: 60
Miscellaneous expenses (haircuts,nails): 60
Personal spends: 200 x 2 = 400
Total Entertainment: 730
Savings & Miscellaneous
Emergency fund / Savings: 2,000
Holidays (monthly allocation): 500
Clothing: 200
Miscellaneous buffer: 300
Total Savings & Misc.: 3,000
TOTAL MONTHLY SPENDING: €7,480

Thank you everyone for your comments, this is really useful.

My husband & I have a combined salary of 115k, and take home circa 6.8k per month. When all our house, car, phone, nursery bills are paid, we are left with circa 2.5k. Within this 2.5k we purchase all our food, utilities, fuel, and extras. We are spending circa 800pm on food/utilities and 250pm on fuel. The food bill does include formula & dog food. This leaves us with 1450 for purchase, days out & any extras. If I’m honest we struggle! It feels impossible to save out of this and yes we could strip back on some things but our kids are young and we want to enjoy ourselves on our weekends.

Any tips on saving money would be appreciated

It’s because you’re doing it the wrong way round and trying to save out of your disposable income. Your savings need to come out of your account at the same time as your bills, so there isn’t as much money to spend and the savings are a non-negotiable direct debit much like your mortgage. Set a budget but break it down like we have above to ensure you’ve got both short and long term savings. On that income you should be saving £500 a month minimum IMO.

If baby is over 1 they can switch to cows milk. You definitely don’t need to spend £800 a month on food, this could easily be reduced to £600 for 2 adults and 2 small DC especially if one is eating at nursery in the week. You need to budget and do a basic meal plan. £600 a month is still around £140 a week so plenty of room for treats.

Don’t be sucked into spending at a “London lifestyle” level, you don’t earn enough for that. My DSIS and DBIL do this sort of spending where they’re in a cafe or a restaurant every day and take their kids on expensive days out without a second thought but both of them earn 6 figures and are able to do this at the same time as saving a lot as well as building a healthy profile of shares, pensions etc. For the rest of us we can’t afford to do both so you need to be sensible and make a budget.

Review all your spending and you might be able to increase your disposable income, freeing up money to save and spend.

Can you get any help with the cost of childcare? You're at the life stage when this is expensive but it should reduce when DC is at school.

For fun stuff at the weekend, see what discounts and family passes you can get and make the most of these, get one or two each year and make those the focus of your weekend days out. Next year, choose something different. Always take a picnic/packed lunch to avoid paying £££s, for shit food that you have to queue ages for.

But see what you spend your money on and whether you can reduce it. Chase the deals, life is significantly cheaper than if you just pay full price each time.

Also see what little extra bits of money you can pick up. I've just taken out a new credit card that will give me £225 of vouchers for somewhere like Amazon or M&S, so effectively cash, just for using it for normal household spending over the next 6 months. I make at least a few hundred pounds a year doing things like that.

Have a look at moneysavingexpert money makeover and the weekly email.

I think the important thing to remember right now is that the childcare bill won’t last forever. So once that is out of the way you should be able to save the equivalent of that. And as a PP said, you have to consider a bill pay into your savings the day you get paid. And don’t be relying on having something left over to save.

Some useful scaling numbers for you.
365 - daily costs
250 - working week costs
100 - twice a week/weekend cost
52 - once a week cost
12 - once a month

We can all get into habits of doing things more and then not seeing how the same costs then adds up turning it from something you'd happily pay for to possibly taking more from budget than you'd like.
It might be worth going through some of your regular activities and work out how much they are costing you a year. Are there things you are doing weekly that you'd get the same enjoyment out of by doing them every other week or once a month?
It's not necessarily about stopping doing things you enjoy but assessing whether you are getting the benefit annual from the things you are doing and working out things you are possibly doing out of habit which could then free up some money for doing different activities.

We have similar income OP but a fair bit of debt, including business costs and car payment, paying back bounce back loan etc - we also have very high rent but no child care . I would say we have around £1800 a month for fuel, food, trips , nights out, clothes - but there are only 2 of us