Help with managing finances better.

[Clarityhelps]

Sorry in advance for my long winded post 🙃.

I am looking for advice on how to better manage my money and increase savings.

I live with my DS who is thinking about leaving school and working full time for a year before looking into college/ uni.

My income when child maintenance and child benefit stops will be £2480 per month

Monthly expenses

Mortgage £645
Council tax £118 and will increase to £157 when DS leaves school.
Pet insurance £14
TV licence £15
Road tax £17
Car insurance £35 - this will greatly increase when DS passes his test.
Energy £125 - I have £300 in credit to cover winter months
Broadband £27 - new fixed rate contract for 24 months - no increase each year.

Netflix /Apple TV - I now and again subscribe if there is anything worth watching and cancel straight away. I wish you could do this with TV licence as it’s only now and again I watch BBC.

Home insurance was paid off in full in February

Mobile sim only x 2 £19 (going to move to giff gaff next month when contracts end). Plus £33.29 monthly payment for my mobile phone which is due to be paid next month. My DS’s phone is 5 years old so may have to buy another one as the battery life is poor.

Food shopping-all meals for both of us £70 to £80 per week to include most cleaning products, wet cat food and basic toiletries. This is becoming increasingly difficult to stay in budget. It’s like I live with the hungry little caterpillar. No alcohol as I don’t drink and I buy a coffee out once a month when meeting up with friends.

Amazon subscribe and save- £30 - £40 per month. Usually things like toilet roll, cat biscuits, dishwasher tablets, cleanser, peanut butter etc.

Work presents for colleagues which has become a monthly thing in last 6 months £15 - retirements, maternity leave, special birthdays and leaving presents.

Clothing/footwear for my DS is never ending. Requires narrow waist and longer length trousers so not easy to buy for.

Birthdays presents. My DS, 3 niece and nephews, 3 siblings and my parents.

Haircuts £15 every 3 weeks for DS. I get my hair done every 4-5 months

Driving lessons £40 per week for DS

DS 2x clubs £38 per month which may stop depending on his work when he finds a job.

Fuel - £100 per month.

I try to put £150 a month away to save and
£50 in DS savings.

I’ve just used most of savings to pay off remainder of car finance so that’s £185 more I will have next month.

I have just opened a Monzo account and want to try and put money into pots to save up for things like car MOT and service, boiler service, insurances, cat vaccinations and flea worming treatments, Christmas and birthday, but don’t know where to start.

Any help and advice would be greatly received.

Firstly, I’d change up the way you are doing things a bit with your DS.

if he goes to uni or college he’ll need to budget, and a good way to get him doing that is to give him an allowance and he decides whether he wants to spend that on clothes/phone/clubs etc.

so rather than you being responsible for his clothing , you work out how much his clothing and clubs and phone have cost over the last year and give it him as an allowance. Then he makes the decisions.

you might be surprised how good he gets at finding bargains!

car insurance is kind of up to
you. It’s very very expensive when they have just passed their test but if you live rurally he may need the ability to drive to get to a job.

if he does get a job I would be asking him to pay for his own food - the deal I have with my DD is we both go shopping and get our own stuff. We each cook three meals a week and one is takeout. That way if she wants expensive snacks etc it’s out of her money and it’s her choice.

Thanks @Octavia64 that’s really helpful. I’ve never thought of doing this and it will definitely help DS to learn to budget his own finances.

I transfer DS £50 a month for pocket money which he has been good at putting some into savings. I forgot to add this in original post and pay for his Spotify too.

If your DS is out of education for a year and will be in full time work, isn't it the perfect time for him to start buying his own clothes, phone, driving lessons, clubs, insurance, spotify, haircuts etc? And time you stopped giving him pocket money.

It would benefit him to manage his own money and to learn how to prioritise using money for needs/wants/saving

Yes, I think I will need to do this.

Have you investigated getting a new battery rather than a new phone?

£19 each per month is a lot for mobile contract. Do a SIM only deal it's much cheaper. My foster son has a SIM only deal with Smarty for £10 per week. He gets 80 GB of data, unlimited texts and calls including can use 12 data in EU. They deal on ATM seems to be 70 GB for £9. It's a rolling monthly deal and you can cancel at anytime. You seem to be paying a fortune for D's haircuts. £15 every 3 weeks. If tell him to get a cheap cut and only get it done once every 8 weeks.

Sorry I meant it’s £19 for both SIM cards not each. We have poor mobile signal where we live so it’s only 02 or those who use the 02 network that we can use . I’ve received the giff gaff SIM cards so we can use them until I see a better deal coming up.

My DS doesn’t get fancy hair cuts it’s just the standard rate here for adult barber cuts. We have tried a few places.

@Clarityhelps , regarding Monzo pots - I would check costs of annual bills - such as house insurance, estimated MOT, boiler service etc - and divide by 12, and then put a twelfth away each month. Hopefully in 12months you will have saved the amount needed, fairly painlessly.

You could also include a monthly pot for things like clothing - you're unlikely to buy clothes every month, but when you do need to buy some, you'll have money available. You own a house so putting money away for house maintenance is a good idea too.

£15pm on work gifts may be more than you can comfortably afford or wish to pay. If you save £15pm for work gifts every month, you'll have £180 per year. If that's too much, how about putting £10 away each month (£120 over 12m) or £8pm (£96 over 12m) to cover any work gifts?.

How much do you spend on birthdays per year? What's your budget? Can you reduce it at all? Again, once you've fixed on a yearly budget, divide it by 12 and then pay that amount into a Monzo pot every month. Do the same with Christmas.

You can make a spreadsheet to go alongside the Monzo pots, showing saved amounts vs actual costs. You may need to borrow from the 'Christmas pot' to fund the 'car insurance pot' for example, especially in the first year or so when you may need to adjust pot amounts to keep within your overall budget).

Finally, if money is tight, think about where you can reduce spending from the 'non-fixed' outgoings. What are your priorities? Also check out moneysaving expert for ideas about getting eg cheaper insurance or SIMs (you can get great SIM-only deals for around £6pm). Also ensure the £150 monthly savings are in a high interest account.

Birthdays presents. My DS, 3 niece and nephews, 3 siblings and my parents.

We stopped buying for adults (and they for us).

Work collections - £15 is too high. I'd just stop as I don't particularly want a gift from work when it's my turn.

Buy your son a reconditioned phone.

We've moved to Lebara for phone contracts - £1.50 pm.

Does your son need to use the car - is public transport an option? The insurance will be very high.

Also, instead of paying for pet insurance, we save the money each month to be used when/if needed.

I wish you could do this with TV licence as it’s only now and again I watch BBC

Then I'd cancel it. Thinking of doing the same thing myself.

Cut out the birthday presents for all those relatives, explain that you're in a tighter budget and wish them well. If they don't understand they weren't worth the presents in the first place. It's a bit trickier with the work ones but I'd stop those as well

Does your son have a job?

How does Amazon save work? It sounds a lot out of your budget, what do you get for that exactly

I have a friend who did that, ended up having to spend £6000 on her dog 😮

£6000? I adore our dog but would say goodbye to him before I'd pay that.

Luckily her husband is a high earner so they could afford it but her attempts to cut down the household spending while she was on maternity leave rather backfired

If your DS id going to be working he absolutely should be covering many of his own expenses and no need for pocket money. It will be a good lesson before he goes off to college or uni, and help soften the blow of lost CB etc.

Also, instead of paying for pet insurance, we save the money each month to be used when/if needed.

That only works if you have substantial savings to back you up in the meantime. Dont underestimate how quickly vet bills rack up - my lovely rabbit was in the vets for four days in August, cost £1,200. (She made a full recovery.) Fortunately the insurance covered it.

Have you checked your mortgage product interest rate is it fixed variable what’s the term and is there an early repayment fee. Check if you can get a better deal L&C have good online calculators and don’t charge a broker fee.

You say you are saving what kind of accounts are these in. Not sure if you get UC but help to save is an amazing deal.

@Spinningonthatdizzyedge really helpful thank you. It’s the saving for all the other expenses that I struggle to budget with, then nip into my savings to cover things. I’m hoping to try and keep on top of it going forward using Monzo pots.

I tend to spend more on Birthdays for family as it’s more manageable than at Christmas. Usually £65 each for birthdays and £45 ish each for Christmas. I may have to lower this for next year.

@BeaBachinasec thanks. A reconditioned phone sounds like a good idea. It’s something I will look into for him for a Christmas present.
I would like the work gifting to stop too but can’t really say no now I’ve been contributing for so long.

My DS can use the bus for getting around town but he will need a car when he wants to visit his father who doesn’t live on a bus route and is quite far out of town.

@NotForTheMoneyandNotForTheApplause it’s Amazon subscribe and save, you can get a discount on products if you sign up to a subscription. Prices can increase after first delivery so I try and keep an eye on them and if it’s going to work out more expensive than supermarket prices I cancel it. Toilet roll deals are quite handy.

I will get my DS to pay for some of the non- essential things. It will definitely help him with budgeting his own money. I’m trying to encourage him to be better at saving his money and he has been really good with this so far and taken an interest in saving accounts and interest rates.

Thanks. I have an ISA that I save into and I have opened a stocks and shares ISA also which only has £50 in but it’s a start. My savings are low just now after paying off my car finance. I’m hoping to try and build it up again.
my mortgage rate is fixed thankfully.