Money Management HELP

#1

Hi all,

I’m trying to get my finances in order, to set up good habits for the future. I’ll give a run down of my current situation - would love to hear your ideas.

I just need a little help in how much is a good amount to be spending/saving with my circumstances.

INCOME:
£1525 monthly NET.

OUTGOINGS

  • £174 on CC - 0% pay £100 a month so should be at zero in a couple of months.
  • £50 a month on petrol.
  • Car insurance, MOT & TAX = £1000 a year.
  • car maintenance - £150 for a service (ish) - yearly.
  • no car payments - drive an old banger & happy with it for now.
  • £20 phone bill
  • £7.80 pet insurance
  • £8.80 prescription
  • £22.99 gym p/m
  • Amazon prime, Spotify & Netflix: £15 a month
  • Student loan (overpayment repayments) £10.00
  • DFS sofas - £40 a month

I try to save around £500-800 a month depending.

SAVINGS:
£2,000 - Santander 123 Graduate Account - 3% interest.
£1,015 - Monzo ISA - 1.15%
£250 - Nationwide 5% saver - 5%
£1 - Newcastle LISA - planning on transferring the Monzo ISA money through once I call up and get my username/password reset.

BACKGROUND

  • bring lunch in 4/5 days - out with colleagues for lunch on a Friday.
  • spend a shitload on takeaways - £200 a month ish?
  • don’t really go out much - struggle with anxiety & depression

What would you do if these were your finances?

1 Like
(Tony, Secret Lemonade Drinker) #2

If you’re able to save £500-800 per month you are already doing really well. You could obviously do to reduce your takeaway cost, but tbh it’s entirely up to you if you feel you need to. It could all be healthy for all I know!

Are you still living at home? There are no payments for lodgings here, or any house bills. Even if you’re living with your folks I still think you should contribute.

What I would do is make a point of recording every outgoing you make for the next 2-3 months, no matter how small. I find that withdrawing cash can obscure things, especially if you always get a coffee on the way to work or something, so this kind of full audit is very helpful for seeing where money is disappearing. Even if you’re only getting a £10 haircut every 6 weeks it can still add up and you won’t account for it otherwise.

Hope that helps!

2 Likes
#3

You look like your doing well if your saving 500-800 a month. You could cut down some costs more if you really wanted to, it depends on what you prefer.

You might be doing this already, but I have a savings account (or pot) where I put car costs/12 per month into it, so at the end of the year I have all the money for insurance, breakdown, mot, etc. then your not in a situation of not having the money for insurance and you don’t need to dip into savings.

1k a year makes it sound like your fairly young? Make sure you shop around every renewal.

Takeaways are are the obvious one, some people just aren’t inclined to took but you can make some very easy very cheap meals in advance, just takes a little prep time one or two days a week, and you can essentially half your food budget.

(Emma (still not the app)) #4

But no pet food? Also no clothes, toiletries etc. You need to do a proper budget but tbh you’re saving a good bit but with those figures there’s a lot of unaccounted for money

3 Likes
(Nick) #5

First thing I’d do is stop overpaying the student loan. There’s no value in doing so.

You should try and calculate your monthly food bill (est.), and add to that the takeaways. That’ll give you a true figure on how much you’re spending on food and if it’s too much (it’s probably too much). There’s definitely going to be ways of getting your food bill lower - cutting out the takeaways if nothing else.

And stop overpaying the student loan. Did I mention that?

2 Likes
#6

I missed that. Agreed. Do not overpay your student loan. There is zero point on your wage, its a waste of money.

1 Like
#7

Yes I am still living at home. I do pay for things here and there, such as food etc. But generally I’m not ‘allowed’ to contribute by paying rent/bills.

I’ll definitely need to do that. I almost exclusively use Monzo so it shouldn’t be too hard to calculate how much I’m spending and what it’s on. I find the Monzo budget feature to be quite… useless though!

#8

Just to clarify; I’m not overpaying on my loan. I was overpaid my maintenance loan so I need to pay it back outside of the usual repayment process.

I’m not currently earning enough to repay any student loans yet.

3 Likes
#9

Very true. I haven’t factored that in purely because it’s not usually a monthly or annual expense, it’s like £30 every 2/3 months or so.

I’ll need to do an actual SOA and budget to really give you an idea.

1 Like
#10

You’re a very lucky person. When I left school at 16, I went straight into work the very weekend after I finished my last day at school. I took home just £50 a week and I had to pay my parents £30 a week for board and lodgings which included my food. I got absolutely no favours whatsoever. I left home at 17 and never went back.

2 Likes
#11

This is a good position to be in, and while you’re in it you might consider taking advantage of it. You might want to think about putting the money away that you would use to pay rent and food and don’t consider it as savings. You’ll get a much better idea of how much you can actually save if you were paying for everything yourself, and it’ll set you up to not be in for a bit of a shock in lack of savings when you do leave for your own place. If that makes sense?

#12

If you’re living at home why are you paying for a sofa? :smiley:

#13

I haven’t checked, but wouldn’t a net salary of £1525 be enough to start paying back your student loan?

#14

That’s under the limit so they should pay any student loan.

#15

I thought the starting point was 21K (and a take home of £1525 would be more than 21K wouldn’t it?)

#17

It depends on the plan but 1525 is below both thresholds .

#18

This is kind of trivial at this point, and slightly off topic :joy: , but according to the take home calculator, £21,000 would give you a net income of £1484.65 per month - Which means the OP should be paying their loan back.

That being said, if @sausageroll101 is saving between 33% and 60% of their entire take home pay, I really don’t think you need to ask the advice of others.

That’s an amazing achievement that other people would love to have the chance to do.

Sure, you can always save £20 here or there by not spending it on something you want rather than need - But you’ve got to live a little as well.

At the end of the day, you are putting a huge percentage aside each month. You are doing well.

2 Likes
(If there's the wrong end of a stick, you'll find me holding it.) #19

You seem to be doing really well already, so I’ve nothing to add. Except to say that if the Nationwide 5% account is the regular saver, the effective interest rate is more like 2.5% (assuming you drop £250 per month in it). :+1:

1 Like
#20

Plan 1 threshold is £1,577; Plan 2 is £2,143

#21

Where are you getting that info from?

Edit - Just looked at the Student Loan website which states all that.

Not sure why the “21K” is banded around, when it’s not even close!

For anyone curious…

http://www.studentloanrepayment.co.uk/portal/page?_pageid=93,6678784&_dad=portal&_schema=PORTAL