£1000 to spend

[Userjal]

Hi, I know this probably has been asked 1000 times before but I’m struggling with money and I need a bit of a reality check if I’m honest. So we currently work on whatever is left after bills food and fuel is disposable money. Which is £1000 roughly. Now this £1000 is always gone by then end of the month with very little to show for it. I need help budgeting and I just need to understand how other people are doing this. So your ‘disposable income’ is this what’s left after you’ve saved for Christmas, birthdays, kids clothes, holidays etc.or do all of these
things come from your disposal income, I need a reality check but I don’t know if I’m living beyond my means or if £1000 to clothes kids, days out, nights out meals out adhoc stuff isn’t enough. For reference we are a family of 4. Thanks

@Userjal non-issues only seem like non-issues when they don’t all come at once.

Id be saving as much as you can into house savings or at least deposit savings for if you need to move suddenly.

All the little bits add up, passport may be £1 a month to save, but for four people you’ll be glad you put £4 aside when that bill comes in and you have it already funded.

Where you’ve questioned about having a night out meaning that you then potentially couldn’t go out the rest of the week, I would look at it the opposite way around. After I’ve paid for all the essentials and put a bit away for unexpected expenses it’s then I would be looking at what’s left and deciding if there’s enough there for a night out.
I get the impression that you’re prioritising your social life, nights out or coffees with friends, rather than prioritising your finances. You need to try and switch your mindset so it’s the other way around. It’s not the amount of money that’s important so what other posters have for disposable income isn’t really relevant, it’s that you’re spending it all.

Do you save anything each month at the moment? You have £1k per month, how much do you want to save out of that and how much do you need to put I pots for the other expenses? Then you have the amount you can spend on fun money each month. I do think you’re living beyond your means, we have more than £1k a month to spend and we will very rarely go on nights out costing £100, and don’t regularly go for meals out. We do spend on family days out and experiences for our DCs.

Not saving anything at the moment as it just doesn’t seem possible, we have plenty of days out with the kids and me having a social life certainly doesn’t impact on theirs experiences. Finding a balance just seems really hard as we’ve been coasting for years without really any financial guidance

We, more so me, do prioritise a social life and experiences over things. I just couldn’t imagine thinking I’m not going to have
a bi monthly meet up with my friends because I’m having for a hypothetical bill

The bills aren’t hypothetical, they just haven’t arrived yet.

Do you have an emergency fund of a few months outgoings saved?

There’s ways to have a social life without spending £100 on a night out or meal though. That is a lot to spend when you only have £1k a month. Work out how much you need to save a month then spend the rest. Maybe £400 savings a month and £600 spending. Saving will impact your DCs in a positive way, you’ll need savings for things like help for university if they go.

No we have nothing saved, we’re literally winging it every month

My thoughts have always kind of been, because I have thought about, once the kids are older I’ll go back to working full time and hopefully that’s when we can save big chunks of money for their future. They’re very little at the moment. I really do know our funds are chaotic I just need to know the best way to still maintain a life but also being more financially responsible.

The £100 night out was just an example, it’s definitely not every month and it’s not always £100

Ok, not owning a house does mean less demands on money.

Still, with £1000 left after bills, I'd be looking to save at least £500 of that. £250 "budgeting savings" for unexpected expenses that crop up and £250 for longer term savings.

To put it into perspective, we have c.£8K left after bills (and we've factored in all annual expenses) and we give ourselves £1K/m (as a family of 4) for spends. That gives us a pretty decent, actually really luxurious, lifestyle. But we're not having to pay for any adhoc expenses out of that, as they're covered elsewhere in our budget.

Kids get much, much more expensive when they get older (unless you're paying for full time childcare).

i work very part time at the moment, when both are in school I do intend on working full time which should bring in lots more money to cover the more expensive day to day costs but also to put some money away

Pay yourself first when you get paid - move x amount of money into a savings account to build up what’s known as a sinking fund to pay for things like school uniforms and dental work.

You also need a rainy day fund. What would you do now if you were in some emergency that your wages wouldn’t cover?

In all honesty I’d ask my parents. I don’t make a habit of these by the way and the last time i received any money from them was probably my wedding

I think you need to sit down and really think about a realistic budget, savings and plans for your retirement. If you are going to continue renting you need to consider what old age might look like carrying those costs forward. Most pensioners who are doing ok have paid off their housing costs and therefore massively decreased their outgoings. If ylu aren’t planning to buy then you may need to consider how you fund that portion of life.

The infrequent bills are not hypothetical, most bills are predictable. You might not have house maintenance but your transport will need replacing, your tv, your laptop, your sofa etc. You probably can’t afford to save for all those things, but you do need to start thinking about that £1000 is pretty much already spent.

Full time work pay - (wrap around childcare + holiday childcare + increased expenses due to older children ) = no extra spare ££££

We do both have work pensions we pay into but I do get what your saying, car at the moment is being paid for with a loan, which is fairly new, same with the sofa, again which is fairly new.

You'd have to be pretty well off to spend £100 on a night out regularly or drop £80 in B&M without it being part of budgeted essentials.

And it doesn't sound like you are if you have £1000 pm after bills, food etc but a good portion of this needs to cover things like school uniforms, Christmas, haircuts, holidays?, insurance? car servicing, repairs etc. Your 'leisure' money might be more like half that amount.

What money does your partner spend? You need to work out where your money is going and review your budget to see how you can make it go further.

Have a look at:

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

If you can reduce the cost of some essentials, start putting money aside for annual and irregular essentials and things like Christmas and holidays and be more mindful about your day to day spending by thinking about what's most important to you and how to minimise the cost, you might start to feel more comfortable financially.

I speak as a reformed disorganised money person! It sounds like you need to have a think about what your priorities are financially and also apply some self discipline and be more grown up about it. A boring reality!

Realistically if you have £1k spare per month and you’re worried about how you’ll afford uniforms then you’re mismanaging your money and probably living beyond your means. Here’s some tips based on things I’ve tried with success:

For one month give yourself a very small allowance for personal discretionary spend (I mean like £20) and make yourself make some choices. Observe your feelings and get some insight into what you really feel like you’re missing out on. You don’t have to live off £20 forever but it can help you think a bit differently as an intervention.

same for family days out - for one month just pick one paid thing and do that. Do free things or nothing the rest of the time. You might get some moans but no one will die from that. Again, observe what happens.

also for one month instead of buying stuff in the moment that’s not 100% essential put it on a list including price and revisit it at the end of the month to see what you actually want to go back and acquire.

If you’re hardcore do all of these the same month, but much gentler to self to do one a month! Getting your finances in order and building new habits is a long game.

if you spend £100 on a night out does it mean you can’t do anything else that week? Yes. You won’t die from having to stay in for 6 days!

Start some savings, relying on your parents is not a plan. Time to be an adult about it. Pick an amount - maybe £200 of that £1k - and put it into a savings account when you get paid.

plan for predictable outlay- you know when your passports run out for instance.

you can do it - takes a bit of work but your can. Make sure your OH is on board tho and isn’t going to undermine/sabotage your efforts.

If your parents are in the financial position that you’d feel ok about asking them for help, then presumably they’ve managed their money well.

can’t you ask them how they budget?

I do think you’re living beyond your means. But you’ll feel far more comfortable if you tackle this now and create a plan.

Holidays are far more enjoyable when you know you’ve been putting aside a chunk each month which covers the cost (including accommodation, travel, passports, new clothes, travel insurance, ice cream spends etc). the years you don’t need to renew your passports are the years you can maybe go a bit more luxury. The same goes for all other categories.

for example, I put £50 into my grooming ‘pot’ each month. I don’t spend it most months, but it’s a good feeling when I can splash out on a mani pedi, wax, facial etc.

and my house maintenance pot grows each month so I can easily pay for repairs, new mugs, curtain dry cleaning etc.

i don’t worry about my teen DD going to university because we’ve saved to help cover her costs. If she doesn’t go to uni then there’s a good amount waiting to help with a wedding or house deposit.

honestly, once you’re in the swing of budgeting, it’s easy and gives so much peace of mind.

Absolutely do the Monzo pots
The reality is that you are spending to much on stuff/ going out FIRST when actually those things should be allocated a budget AFTER everything else's accounted for.

It really stops that going B&M and buy a few things = £80 and you stand there wondering why you did it ! been there

Monzo is really easy to open and then you take a hard look at what you need to account for that isn't a monthly bill
Also you dont mention savings?
Savings before treats here!

Example
Savings £250
Christmas £100
School uniform £20
Vet £5
Passports ×4 £4
Car service and maintenance £30
Rainy day / emergency fund £50
New glasses x 2 £33( have very expensive prescription)
Clothes £50
Shoes £50

=£537

Left is £477

= £200 each you and DH for personal spends

£77 Can go into your rainy day fund or another expense you may have such as kids clubs etc

When I started this I was the same money didnt go very far and moaning every time I had an " unexpected bill"
They are not unexpected, that's the point

Of course if you have a car it might break. Your bloody dog eats a stick, Christmas comes every year etc

You can tweak your categories to suit you.

To me it was a massive eye opener

I went cold turkey for a couple of months on extra spending to get my categories built up and now its just like everything else.
I just do it
Monzo pays interest every month and,I add any extra bits like Premium bonds prizes.
It is amazing how quickly it adds up !

You don’t have an emergency fund, that should be your priority. And then building savings for your family. You can still have a life on a smaller budget.

Ps prev poster mentioned an account that pays no interest.
Choose one that does pay, it all adds up!

This is all great advice thank you, it’s this what I’ve needed because honestly I’ve just been coasting. My husband isn’t really a spender, will not to the extent I spend, so should be fairly easy to get him on board.
my parents have been lucky with pentions and received good bits of inheritance or gifted lump somes so have never really been great savers and when we were younger there was never really anything there for a rainy day so I’ll probably not use them for advice but thank you for the suggestion.