I'm not sure if I am budgeting properly...

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Learningasigo

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Hi all. Hope all is doing well.

I've a questions. Be as blunt as you can be and give all the tips and advice you can. It will be all appreciated. Belive me.

I am early 30s and I live in Dublin City with my partner who is early 30s. We both work full time and earn the same wages. We've no children (would love a house, marriage and children in the future of course). Currently renting a one bedroom apartment for €1450 PM. We both drive, our jobs are outside the city. Wishful thinking to purchase a house by the time we are 35 but God only knows what the house prices will be like by then.

Recently I have finished off a loan I had. It took me a year to build up the savings so I could pay off the loan and still have enough to build back up again. So that's been a huge stress relief.

The savings I used towards this loan, has now been turned into my "deposit" fund as it reminds me that it's going towards something in the future and I've no intentions of dipping into it for anything leisurely.

I get paid €500 (sometimes I do overtime if I it's available, which can be an extra €20) weekly.

Out of that €500 I pay....

€180 towards rent (weekly) (could also increase as landlord has informed they might increase the rent, so I might have to move, I'm not sure yet)

€200 Savings ("deposit", I am making it my mission to save for a house in the future and I would prefer to save as soon as I can and build up as much as I can. Also I was hoping to save a set amount each week as I can do the whole "if I don't see it in my account then I can learn to live without it")

€20 for my "Rainy day" funds (which also means maintances in case the car needs a repair or something in the house needs fixing etc, the usual stuff that no one wants to think of plus I do like the odd time to go out, previous to Covid 19 obviously, so see what happens now but it's nice to have something to fall back on)

€20 for Car insurance/ tax (I pay these yearly but I prefer to set an amount to the side each week so I'm not struggling to find a way to pay when the time comes. My insurance has been less and less each year so I've been lucky in a sense that I don't have to pay too much)

€30 for groceries (sometimes less, maybe €20 as I tend to do brilliantly some weeks with batch cooking then other weeks I'm cooking something different each day so I rarely get a take away or go out for meals but thank god for Aldi!!! )

Which I'm then left with €50 to last me until the next pay day the following week. Can I ask, is this reasonable or am I doing something wrong along the lines? Often by the time Sunday rolls around and I see €50 left in my account. I'm often woundering is that enough? Am I depriving myself or is that pretty much what most people live on (if they get paid weekly).

I pay health insurance once a month which doesn't need me to save weekly (or I can take it from my rainy day funds but I've been able to pay from my wages)

Other than that I have no major payments or direct debits that come out of my account that I need to worry about. Also just to add, I have a pension scheme set up with my job so I don't have to worry about setting up my own personal one, I don't plan on leaving my job, not for years anyways.

Thanks for reading and hopefully it wasn't too much of a bore to read.
 
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RichInSpirit

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Hi Learningasigo.
In my book you are doing brilliant with your money. Particularly with the food part. I'm more than double your spend on grub. It's one area I keep meaning to improve on but I haven't quite got it right yet.
 

Learningasigo

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Hi Learningasigo.
In my book you are doing brilliant with your money. Particularly with the food part. I'm more than double your spend on grub. It's one area I keep meaning to improve on but I haven't quite got it right yet.
Hi RichInSpirit.
Do you reckon? I was speaking to friends about this and they were shocked that I was left with €50 (sometimes less) and can't understand why I have "so many savings" as they say.
Myself and partner have no children. As much as we would love too. He himself has savings but also has a loan and wishes to pay that off. He is pretty much on the same wage as I am and pays the same rent. We aren't poor by any means but I'm often woundering am I leaving myself broke for no reasons.
In terms of the food shopping. We both eat the same things so the batch cooking works that we can make loads and it lasts ages. Don't get me wrong, there are days we get bored of the same thing but each week I make something different.
Thanks for your reply
 

RichInSpirit

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I don't think you are leaving yourself broke. You are saving €10000 per year or more. That's brilliant going. If some real financial emergency cropped up, you could dip into it. Even though I know you don't want to dip into your "deposit".
Also regarding buying a house, your rent at the moment sounds not too expensive. Maybe you could rent for longer than you might have considered and perhaps buy a house during a future downtown in the property market. You might be able to buy without needing any mortgage at that stage.
 

Learningasigo

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I don't think you are leaving yourself broke. You are saving €10000 per year or more. That's brilliant going. If some real financial emergency cropped up, you could dip into it. Even though I know you don't want to dip into your "deposit".
Also regarding buying a house, your rent at the moment sounds not too expensive. Maybe you could rent for longer than you might have considered and perhaps buy a house during a future downtown in the property market. You might be able to buy without needing any mortgage at that stage.
I'm hoping my landlord doesn't increase my rent as we've found ourselves in a position where we are comfortable, financially wise. During the lockdown we sat down and completed a budget plan etc and it worked out so well.
I think my friends comments have left be baffled as to why they taught I was leaving myself broke which made me think I was doing something wrong along the way.
My partner, I will admit is a huge spender. Once everything is paid off and he's got money left over, he will buy something for the sake of it. It's his wages, I can't tell him what to do but I know personally if I don't have my savings, then I feel I have nothing to fall back on.
I'm hoping by 35 we can be in a position that we can afford a home. Personally I would love it to be earlier and my biological clock is well and truly ticking haha!
 

Clamball

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Do you and your partner have the same saving goals? House, babies etc, and do you contribute equally to the saving? If not then it may cause resentment between you in a couple of years.

I think you are doing great, no debt, two jobs, living within your means, short and long term saving and life plans. Your careful with what you spend your money on and you still have some money each week to spend on yourself.

The only thing you could do to make the dream a reality faster is increase your earnings. If you can’t move up at work is there something you can do evenings, weekends to earn a few extra euros? And the other things that could happen is that you could have a baby earlier than planned. How would you manage on mat leave or for childcare?
 

elacsaplau

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Hi Learningasigo,

A few observations....

- where are petrol, other motor expenses, phone, medical, clothes, grooming, weddings, holidays, Christmas, etc. paid from?

- is it fair to say that the savings burden for presumably a common goal is being shared very unequally?

- what happens to the finances post child - i.e. impact on work, childcare, etc.?

Best wishes....
 
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Learningasigo

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Do you and your partner have the same saving goals? House, babies etc, and do you contribute equally to the saving? If not then it may cause resentment between you in a couple of years.

I think you are doing great, no debt, two jobs, living within your means, short and long term saving and life plans. Your careful with what you spend your money on and you still have some money each week to spend on yourself.

The only thing you could do to make the dream a reality faster is increase your earnings. If you can’t move up at work is there something you can do evenings, weekends to earn a few extra euros? And the other things that could happen is that you could have a baby earlier than planned. How would you manage on mat leave or for childcare?
Myself and partner are on the same page about what we would like in the future. Majority of times, he's more laid back than I am but that's more down to personality rather than laziness. He himself is an extremely hard worker. He will take as much overtime as he can, moreso just put that extra bit into his debts to bring it down.

He contributes to his savings just as much as I do. We've decided on separate savings as we both wanted to focus on our loans first before we start thinking about merging any accounts together as we felt that each of our debts were applied before we met and it didn't feel right to pay. Don't get me wrong, we help each other out as much as we can but usually when it comes to groceries etc, we take turns but overall we are on the same page.

Job wise. I've been in my job for over 11 plus years and my earnings have increased over those years and I'm more than happy to say that it's comfortable. I work full time as it is. To be blunt, I don't fancy taking on another job or attempt to make any extra as I feel my job is demanding as it is and the free time I have, I pretty much use it too either catch up on housework and us women can be fussy when it comes to the men cleaning. I won't lie, I live a little bit further than friends and family and it's nice to use that free time to make time. Don't get me wrong, over the years I have taught about doing small part time jobs but I have realised as well that, although we both work, and hard, it's the free time we appreciate the most. My partner has mentioned a couple of times about maybe taking up an evening here and there doing Taxi work or maybe doing his own business in what he does for work. I support him on those ideas so we'll see over the next couple of months how things pan out.

As for children now, don't worry we know accidents can happen. We are not oblivious and I'm protected, so is he. I would absolutely love 10 children by now if we weren't in the postision we are in now but it wouldn't be fair on the child and it wouldn't be fair to add on pressure we know we couldn't handle.

Thank you for your reply
 
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Learningasigo

Registered User
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Hi Learningasigo,

A few observations....

- where are petrol, other motor expenses, phone, medical, clothes, grooming, weddings, holidays, Christmas, etc. paid from?

- is it fair to say that the savings burden for presumably a common goal is being shared very unequally?

- what happens to the finances post child - i.e. impact on work, childcare, etc.?

Best wishes....
My "rainy day" funds is topped up top by €1,500 as we speak, especially when lockdown hit, I had more than enough to put away, so I dip into that for the important things and luckily I haven't seen it drop too much as my wages pays for groceries and the likes. Like I stated, that pays towards expenses if the car needs fixing (which luckily I haven't needed to do anything major towards it, except for new tyers and battery).

I don't have a phone bill so my credit €25 a month (pay as you go) which doesn't run out most of the time as I use WiFi (that is included in my rent, life saver!) and my job has WiFi. Most places have wifi these days and I'm the same network with most of my family and friends so that's pretty much free calls and texts.

My petrol is €20 every two weeks as I live in the city so I can take the bus or walk around as I have the choice too so again, I top my funds by €20 which can go towards petrol when needed. My car is old (not banger old but old enough) so there's hardly any maintances towards it but again, with old cars, you never know. My partner also has a car which he looks after himself.

As for holidays, we've scrapped that as we knew we had debts that needed to go before we planned on our future. Something has to give. The same goes for Christmas, my funds builds up and when November comes, I have enough to "splash out" without having to worry about the last minute things. Weddings? Well we are engaged at the minute but don't plan on marrying until we've got our house, so we can save properly when the time comes. Friends weddings? None of our friends are in the process of getting married yet so we don't have to worry about forking out.

Obviously our plan is to have a house before we have children. It's more for the comfort factor of knowing we have a stable home (with the rooms that we are hoping for) so we know circumstances will change and that's when a couple of changes to savings will be paid but again, debts will be cleared and there will be more leeway. Understandably, also like the last person posted, accidents can happen and we aren't stupid to know that changes can happen but we are very careful in that way but we have spoken about it and cross the bridge if needed. Personally it wouldn't be a bad thing. I've family who have unplanned children in circumstances that I've woundered how the have managed, earned less and overall stopped working and their children have the best life, better than me haha! It's not all doom and gloom but we know ourselves, we don't want to bring a child into the world knowing we have debts as it potentially means one of us (knowing my partner) will end up adding more to a loan if we felt we had too, that's just adding more stress.

As I said we are early 30s and we met years ago, just lately we have decided to knuckle down and of course lockdown made us realise that although we've had our fun and we've done and experience all that we needed and wanted too, it was time to move on up in the big bad world so they say.

I was more concerned if I was doing the right thing budgeting my money or was I leaving myself broke, so to speak.

Thank you for your reply
 
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DeeKie

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You are doing well. Himself needs to throw the leftovers at his loan rather than spend it. That should be the plan. Also looking at phones and utilities can help save money every year. Easy wins
 

Learningasigo

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You are doing well. Himself needs to throw the leftovers at his loan rather than spend it. That should be the plan. Also looking at phones and utilities can help save money every year. Easy wins
That's what I told him about the left overs. Although I understand his point that he can't just live on nothing and work for his wages and not see it at the end of the week. I've explained that treating yourself is nice which is why I have a rainy day fund for those times I would like to treat myself (which is rare) but when you know there's a loan or debt that's dragging you down, would it be easier to just get rid of it as soon as you can and tell yourself by, for example, Christmas it will be cleared and you can treat yourself all you want.

I made a point to just scrap all I can, save all I can and get rid of things that were coming out of account that was just unnecessary. The freedom is great and knowing I can see my wages clearly. I changed phone bill plans. I used to pay €50 a month and I cancelled that and I pay €20 pay as you go which I've notice hardly runs out. I've lessened the use of my car and walk as much as I can, both healthy and free. I batch cook so I don't have to worry about running to the shops to buy dinner on a day "we've no food". I found myself a great deal in health insurance (always good to have as you never know what could happen! ). My job pays for my pension, I contribute so if comes out of my wage before I get paid. I've sussed it all out. My rent is the only major out going and €200 savings and the rest I can sort of switch around freely.

I've shown him this post and my bank account. He knew I was saving but didn't realise how much I had saved over a good few months and I think he's had a bit of a light switch moment. He's got a fair bit to pay off so I told him if I keep saving, he does the same and by the end of the year, with what he's already putting in his loan, that will have dropped and the savings he has he can put a chunk of it into the loan and I can help if needed. Before he knows it, he'll be saving and won't have to focus on knowing the savings is going to be gone on something he feels is pointless.

Thank you for your reply
 

Learningasigo

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Why is he building up savings rather than just repaying the loan faster? It makes no sense to be paying interest unnecessarily.
Fortunately the interest is already paid and its just a loan. He spent the best part of 2 years plus paying the interests off so now it's just the loan itself.

It was the same as myself. When I applied for the loan I had previously, I looked at my statement and saw I had €1,000 plus interest before I was able to say I was paying the loan itself.

I rang my bank that I was paying the loan too to find out where I was and they informed me that my full interest was paid and every month they had an extra €20-€40 in fees. I was woundering why my loan wasn't dropping as much as I taught. So I spent a year saving then I paid it all off. The loan dropped each month, not massively but it helped then when my savings got higher, I was able to take away what I needed to pay and I was still able to keep a good chunk and continue where I left off.

He's going to ring his bank on Monday to find out exactly where he is. He's got some savings that could potentially drop the loan but I think he's seen the way I did it and pay it off in full and still have some savings left over so he's not completely empty in his savings and doesn't feel it was all for nothing.

I genuinely think it's steemed from my parents constantly telling him that if he just pays his loan with no savings then he will have nothing to fall back on and then when his loan is paid, he would have to start all over again and making the process longer. Whereas, if he pays his loan and save and sees the savings build up and the loan drop then he can take the chunk of it out and still have savings and build it back up knowing its going towards something he wants and doesn't have to worry about dipping into it.
 

RedOnion

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Fortunately the interest is already paid and its just a loan. He spent the best part of 2 years plus paying the interests off so now it's just the loan itself.

It was the same as myself. When I applied for the loan I had previously, I looked at my statement and saw I had €1,000 plus interest before I was able to say I was paying the loan itself.
Sorry, that makes absolutely no sense.
Are the loans in Ireland? Because that's not how loans work here. Interest is charged daily on the outstanding balance, so the earlier you repay it the less it will cost you.
I'd happily take a look at it to explain if you like.
 

Learningasigo

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Sorry, that makes absolutely no sense.
Are the loans in Ireland? Because that's not how loans work here. Interest is charged daily on the outstanding balance, so the earlier you repay it the less it will cost you.
I'd happily take a look at it to explain if you like.

Can I derail this to the topic I was talking about? I think we are going off topic completely to what my original post was about.

Thanks for the offer. My debt is paid and partner is working towards his. My original topic was the title of my thread.

My original topic was am I leaving myself broke.

Thank you.
 

moneymakeover

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Your savings, you have different ones eg rainy day, long term
Are they separate savings accounts in your online banking? Credit union?

And how do you ring fence the money?

If something comes up eg car repair, doctor visit etc?
 

Learningasigo

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Your savings, you have different ones eg rainy day, long term
Are they separate savings accounts in your online banking? Credit union?

And how do you ring fence the money?

If something comes up eg car repair, doctor visit etc?
My deposit savings is long term which I plan to use towards a deposit for a house, knowing it will take me a while but I don't plan on touching it.

My rainy day savings is more towards daily and weekly things. If the car needs something. The apartment needs something. An occasion coming up. Savings I know I can dip onto. Docs apts etc. I'm sure someone's birthday will be coming up soon that I've most likely forgotten about, just get something small. Usually at the end of the week, the day before payday, I put anything that I have left over in my current account into the rainy day and it builds up.

I have another account which I put money in for my tax and insurance so at the end of the year when they are due, it's there. I don't have to worry about putting extra away nearer the time or worry I don't have enough.

These savings account are on my online banking.
 

moneymakeover

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Yes i do the same with online banking.

It's convenient.

But because of that it's easy to move the money around in an instant :)

The credit union is slightly more removed

Insofar the house deposit, you might want to accelerate that because of the cost of rent.

The mortgage monthly won't cost any more than what you're already paying in rent.
 
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