A fine example of one of my shrewd purchases last year* 🙂
Eh!? Bit early for a post on The Budget isn’t it!?
No silly, this is the TFS Household Budget we are talking about today!
Since I’ve now got a full years expenses locked and loaded into one of my spreadsheets I am hoping this years budget will be more accurate than last year, which wasn’t all that bad in the first place. There will be many life changes going on this and our income may be all over the place, but one thing that is fully in our control is what exits our wallets, so this is going to be a big part of whether we survive and thrive in 2016.
* Before we go into the budget a quick aside on the photo above, in case anyone was wondering about that. I decided it would be a fab idea to buy 20 Kilograms (yes, 20!!!) of Bicarb of soda to see if I could make some home made cleaning products, along with 20 Litres of white vinegar. A slight overestimation on what I needed! I do like buying things in bulk but maybe I took this one too far. I’ve very nearly got round to making some Dishwasher detergent but not quite done it yet, when I have done that and maybe got a few others under my belt I will certainly make a post and let you know how I got on!
budget summary
As usual I’ve split our spend up into “The Fun Stuff” and the “The Boring Stuff”. The fun stuff means our elective spend (“wants”) and the boring stuff is what I think is our bare essentials budget, what we could get by on (whilst still living a very objectively comfortable life, it has to be said) without going out of our way to spend any other money.
I also like to break out any one off home improvement type stuff so have done that again. I know there will likely be some sort of home improvements every year, but these are going to be very variable and we’ll generally know what they are in advance for the coming year (barring emergencies!) so I think it’s OK to budget them in as and when they are planned like this. If an emergency house repair comes up and we blow the budget because of that, so be it!
As you can see we plan on doing up the kitchen a little bit, a few bits in the garden again no doubt, and I’ve left £600 on the table for any other random projects I might have time for. I fancy the idea of building a few shelving units for some more storage space. Our house is nice and big enough for us, but doesn’t make much use of the room for storage. This could be a sign we have too much stuff of course, which we probably do have, but neat storage solutions will always come in handy nonetheless so I’m going to look into it as it looks like a fun project (or two!).
You will also notice I have a Last Year column so you can see where my estimates have generally come from. As you can see the total spend is about £3K less than last year and if we hit that I will be very happy!
One thing probably worth mentioning is that once Mrs T goes down to statutory maternity pay, which is 6 weeks after she takes maternity leave, our core income will only be around £2500 after tax and other work related expenses. This is quite a scary thought because it means we will actually be running at a loss each month even against the total core budget I’ve laid out above. This means we’ll have to eat into our cash reserves or find other ways of making more money 😉
the boring stuff
Let’s cover the boring stuff first! This is really boring stuff such as:
- Bills
- Mortgages
- Food 🙂
OK so food can be quite exciting but you get the picture. It’s stuff we “need” in the modern world to survive, food, shelter, energy, transport and so on. This is how I’ve broken it down:
Points worth commenting on:
- Car maintenance is lower this year because we actually bought a new car last year, and it’s seeming quite reliable so far compared to the previous TFS Mobile. So I think we’d be hard pressed to spend another grand on maintaining the new one (that’s given that the kiss of death then!!!)
- I’ve slightly reduced our Grocery spend from £250 to £230. I will still be trying to hit £200 per month but there are always a few months where we go wildly over that (Christmas, for a start) so I reckon £230 average is a good target this year.
- Mobile phone bills should be lower as Mrs T went onto a much better contract towards the end of last year! (I get mine paid for free by work)
- I’d love to think we will smash the Petrol/Parking target, as Mrs T will not be driving to work any more once the baby comes along. But we might do more driving trips out with the baby, so it might balance itself out!
If there is anything you would like clarification on or are curious about just let me know in the comments section? Thanks! 🙂
the fun stuff
So this is the “wants” section.
I honestly don’t think there is too much to say on this section. I’ve clearly just used last year as a good guide and slightly modified up or down as I reckon our spending might be trending this year. But here are a few points:
- Going out is considerably lower (£800) but I can’t see us hitting the tiles with a newborn in tow, although I’ve slightly rebranded this category with a “Days Out” and “Eating Out” add on which will no doubt replace boozing sessions, although I still think we’ll be overall in the green on that substitution, we shall see whether my theory is correct!
- We are going on a few good ole British breakaways this year, mainly to the Isle of Wight and so I’ve budgeted £300 in each, plus another random £300 in case we have a few weekends away. They are all going to be cheap accommodation plus we’ll be fairly frugal whilst away, and any extra spending will likely just come out of the days out/eating out category.
- I’ve also added a Children section which is £100 per month. I would like to think this is a massive over budget but again we’ll find out!
- I decided to add a Miscellaneous section which I rather short sightedly left out last year! You can’t predict everything so building in some extra leg room seems wise.
Even with all the additions it seems (or at least I hope) our fun spending will be nearly £2K less than in 2015. Just gotta execute on the figures now! 🙂
What do you reckon folks? Will we sink in the swamp of unforeseen expenses or glide our way through the crystal clear financial waters?
Also have you set up a budget yet this year? If not then WHY THE HELL NOT YOU LAZY HEFALUMP!!!!?!
(Apologies… I’ve had a long day at work and am feeling a bit on edge 🙂 !)
Discussion (13) ¬
I’ve a couple of suggestions TFS;
-look into “shop and scan”. As long as you arent too precious about someone knowing what you buy, the voucher rewards can be used against haircuts (Toni and Guy) or a load of other things if you want but we use it for T&G.
-For the baby, make use of Aldi for nappies and wipes. Use free/subsidised groups locally, the library and parks. For swimming, instead of expensive classes, check out uswim.com and/or generally just mess about in a pool with them, singing, splashing, pulling faces etc.
Thanks for the tip off SLG! Sounds very handy, for Mrs T at least. I don’t think I’ll ever need to go into a barber shop ever again 🙂
You are one of a multitude of people recommending Aldi for baby stuff, we’ll definitely be checking it out! I like your suggestions for the swimming, the thought of going to too many organised baby group type things with boring middle class “up with the jones” types sends shivers down my spine if I’m perfectly honest! Will check out uswim as I’ve not heard of that before. Thank you so much again for the suggestions 🙂
Me too on the barber front. Mrs SLG was paying something similar to the £300 but dropped one cut and with the vouchers it comes in at less than £60pa or thats what i’m told….
Dont knock the groups too much (just dont pay for them)! I’ve met some really cool people i wouldnt have usually met with, just because we have a kid in common!
Haha, I’m just being a miserable git and making assumptions that I probably shouldn’t on the groups front… apologies 🙂
Potential outgoings/savings:
Outgoings: life insurance and income protection maybe
Also child care costs if you both intend to return to work.
Savings: second hand baby kit. New parents in the UK tend to buy everything new eg travel system, high chair, steriliser etc the list is enormous. There also seems to be a weak secondhand market which is utterly wasteful as most is overpriced and parents have a terrible sense of guilt around wanting the best for their child.
I wish you and your new family all the best in your next life phase
Hi Nixcy,
Thanks for the comment, those are some really great tips and I totally agree that new baby stuff is so overpriced compared to what you can get it for slightly used. The depreciation must be worse than buying a brand new car!
We’ve bought a couple of things new but have already gotten such an enormous amounts of hand me downs (and I use that phrase loosely. In my day hand me downs were very well worn, this stuff has been used about 3 times and in certain cases is literally still BNIB!) that we aren’t going to need much more kit anyway, for now at least! It does go to show how wasteful and inefficient we are as a society but until I become Grand master president CEO of the World, I can’t change it so will gladly benefit from this crazy system in the meantime.
Re: the costings you thought of: I have income/life insurance built into my work benefits package and we’ve already decided that child care+full time work is not a viable option for Mrs T – and we have two very keen Nans living just round the corner for when she goes back to a part time job! 😉
Thanks again for your lovely comment and all the best to you as well.
TFS
Thorough as ever, TFS. Good job!
I’m afraid I’m a lazy hefalump who hasn’t budgeted. My rationale for that is that I find it harder to let myself go than to keep myself in check, financially and in other ways. I do have an overall monthly spend/savings rate fingure in mind, though, so although I don’t budget by areas, I suppose I have a mental overall budget of sorts.
Hi Mr FS
Judging by your monthly updates you have everything in check anyway so I wouldn’t worry too much about it 🙂
Just don’t give in to the ever present lifestyle inflation demons!!!
Cheers!
Good luck with the budget TFS – interesting to see that you have ZERO for your gambling/gaming – does that mean that your matched betting etc will only use funds that are already in your accounts and you won’t be topping up funds?
Hi weenie,
Basically my plan is this: Matched betting will be done in Mrs T’s name as she hasn’t opened many accounts yet. This is not gambling as you know so it WILL yield a profit, for definite. I have a few accounts still yet to open in my name so I can do a mixture of matched betting and a few little bets here and there, OK there is a risk here that I lose money if I go overboard but I’ve managed to keep this in check for the last 4-6 months running of 2015 so I am backing myself to be able to turn a profit one way or a another for this year also.
Re: topping up funds: Just because I need to top up funds at any given point to do matched bets this will not be taken into account as an expense because I know I will be getting that money back plus some profit, hence the zero. Money dashboard let’s you keep this nice and separate as you can just tag everything going in and out as “gambling transfer” and then tot it all up at the end of each month, but to make it even easier we’ve set up a new bank account for Mrs T so I can just report on the total balance of that bank account each month and then take the difference of that and the starting balance and that will be the total profit (hopefully) each month. But again even if it happens to be lower due to some bets not having settled yet or withdrawals not processed, this will not be counted as an expense, I will just report the overall figure and track it totally separately to expenses.
Hope that makes sense!
Cheers 🙂