Noor77's personal budgeting thread

Basically, I need a little help as I never seem to have any money.

I have an income of approximately €2,300 a month net and pay €750 a month on a mortgage. I only put the minimum of €20 a month into my SSIA account. My gas and esb bills work out at about €80 per month combined. I have no credit cards, laser cards, cheque books, overdrafts etc... Aside from my mortgage I have no other loans.

The problem is I never seem to have any money. I get paid every 2 weeks and by the time the second week kicks in I am always very low on funds. I never have any spare cash for things that crop up unexpectedly. Even paying for my tv license seems to leave me broke!

I've just turned 27 and feel I really should be saving. What am I doing wrong?

I should probably say that there is no possibility of reducing the mortgage repayments.

Help!!!

I suppose you've done the obvious and kept a money diary? I.e write down exactly what you're spending your hard earned money on?

I have actually Vanilla, but it doesn't seem to help me at all. A lot of the time I think that maybe I should have waited a few years before I purchased a home. But I can't turn back the clock now. I suppose a lot of my problem related to the fact that most of my friends have way more disposable income than me - because they don't have the burden of a mortgage obviously.

Have you had a look at to get some tips and ideas on how to manage your finances better if that's what you need to do?

Hi,

Monthly income - €2,300
Monthly non-discretionary spending - €850

Net discretionary spending - €1,450.

Don't know what you're spending it on Noor, but you're obviously having a good time with it!!

You should be able to live very comfortably indeed on €200 per week, leaving you €650 p/m for savings.

Maybe I'm not reading your post correctly, but I pay virtually your mortgage repayments in rent each month, take home a good bit less than you, max my SSIA, and have a few hundred left to chuck into a savings a/c each month. I have set myself a strict budget of €100 per week, which although tough at the beginning, is easy now, and has been instrumental in getting my finances sorted out.

Try cost cutting by bringing your lunch into work, etc. Also, try to take it easy on nights out - in the past I have been know to burn through up to €100 on a night out - waste of money, unless you like being broke and having a killer hangover!! And please please TRY to max your SSIA!!

How do you do it Sherman!!

My figure of €2,300 breaks down as approximately €900 every two weeks as a net salary and €150 every two weeks income from a room I let in my apartment.

I don't know how you manage to save that much but I really admire you for being able to do it.

I'm not extravagant at all and not a very heavy drinker but I just find that everything adds up - even coffees with friends, going to the cinema etc... And it always seems to be someones birthday .. already this month I've had to fork out for 3 birthdays and a wedding anniversary!

Discretionary Spending

Hi Noor

I understand where you are coming from but Sherman is right about setting a budget for discretionary spending and sticking to it. There is a good possiblity that your friends are not saving as well as not having their own home or could be using credit cards or other debt to finance their lifestyles.

Don't feel obliged go mad on presents etc. Most people have all they need these days, so often presents just become junk after a while.

It's hard to strike the balance between fun and savings; it's down to each individual. Mine is even lower than shermans; €70 a week (including all food). I don't meet it every week but its my target and I make it or close 70% of the time, I reckon.

Rebecca

Re: Discretionary Spending

Does the €70 include transport to and from work Rebecca???
How do you manage if you want to go out? What do you do if you need to buy clothes etc...?

I buy practically all my clothes in a-wear and penneys but I still seem to be always broke

Re: Discretionary Spending

If you tried to keep a money diary and failed or it didn't tell you where the money was going then I think that's where you were going wrong and you really need to do it again and stick with it. There's no point in wondering how other people get by on so little or save so much without making an honest and detailed appraisal of your own incomings and outgoings. Once you know where the money is going you can then start looking for ways to cut down on your spending. It's not rocket science - in fact it's simple, but not necessarily easy.

Noor,

Buying property was definitely a smart move, your mortgage amount sounds quite manageable and your propertyless friends are going to get increasingly jealous of you. You did well to get in at a younger age than most manage.

Try living for a day or two on no money at all. When you want to buy something ask yourself to you really need it. Your esb and gas bills seem low. Do you spend a lot of time out? How much do you spend on entertainment. Don't try to match your better paid friends social spending.

I would tend to agree with Repaymentator. You have done very well at 27 to have a reasonably low mortgage.

You know, life isn't all about saving, saving, saving and investing. It's also about living.

A house is expensive. Your finances will improve as the years go by when your salary increases.

In the meantime, enjoy yourself! Go out with your friends.If you get extra cash put it into your SSIA.

Marion :hat

Probably joining in with a few other comments, but regarding;

"I've just turned 27 and feel I really should be saving. What am I doing wrong? "

You own a property. Your mortgage payments are your savings. Fair play........you're doing okay.

Something defintitely doesn't add up with your figures.

You talk about coffe with friends and cinema and so on. The thing is that is is possible to do this in two ways - the expensive one and the good value one.

If you go to the cinema and bring your own snacks along then good. If you go there, buy a big popcorn, nachos, etc . . . then you can easily spend €25 if there are a pair of you in it. Doing this once a week and you are spending 4 times what you are putting into your SSIA a month.

Coffee - you can get yourself a coffee and something to eat in a normal place for a few € or spend up to €10 in a trendy place. Do this a few times a week and the money mounts up.

When you go shopping do you buy all the pre-processed foods like pre-washed and sliced apples, pre-made mixed vegetables, etc ? A lot of people buying these things don't fully appreciate that they could buy the raw materials on the shelf just beside them for a fraction of the cost. Convenience is worth paying for . . . sometimes.

There really must be some significant discretionary spending going on in your situation - as outlined by some of the reponses above. It is not necessary to live on the bare minimum while saving everything that comes your way, but at the same time you seem to be worrying about the 60% or so of your money that seems to disappear each month. It is going somewhere particular - you just need to identify where it is going and evaluate whether you want it to still keep going there.

z

Thanks a million everyone, you've all been really helpful.

Last night I had a good long think about how I spend my money and I have identified some areas where I could probably cut down. An example would be that I reckon I spend €40 a week on newspapers and magazines, which is a bit ridiculous. In future I'm going to limit myself to two Sunday papers and two magazines during the week.

Re: the coffees with friends, I probably spend €15 - €20 when this happens, as sometimes I might get something to eat as well. I go to the cinema quite a bit and maybe spend €20 each time. I also seem to spend an inordinate amount on vitamin supplements. I don't go "boozing" that much - maybe every two weeks. When I do I probably spend about €80 -including taxi fares.

I know I'm silly to be jealous of my friends with all the disposable income, but sometimes it's hard not to be!!! Especially when they spend about €200 on a pair of shoes!!!

Re: the mortgage, it should actually be €1,000 a month but one of my parents pays €250 each month towards this, and I am very, very grateful for this. They decided they would do this for the first four years I was in the property.

Sometimes I am so tempted to get a credit card, but I know that this wouldn't be good in the long run

Where does all the money go

Don't panic Noor - I'm not a financial whiz or anything. A couple of years ago money was really really tight (I too got on the property ladder very young) and I was kidding myself about my spending, so I figured out exactly what i needed to spend to function in a year; mortgage, car loan, insurances, esb, petrol, heating oil etc. and what was left over was €70 a week for food, clothes and going out etc. and I just got used to it after a while. Even when there is more money available now (pay rises, less loans, etc) I don't tend to spend much more, which I'm amazed at myself. €70 isn't that small really; food makes up about €30, thanks to Lidl, Aldi etc. I bring lunches to work mostly and the €40 covers the rest. I go to the cinema and have meals out and go mad in the pub now and again but not all in the one weekend (which is probably where I was going wrong).

Rebecca

That's where it goes

Oh holy god Noor! You have me laughing to myself here - sorry! You could try eating less junk at the flicks and maybe need less vitamins as a result! Try reading some of the papers online, the UK papers especially have really good websites and mostly free. I am not fond of print media anyway because they seem so wasteful, so I'm lucky on that one.

Don't mind your friends and their footwear either, as the song says "You are the generation that bought more shoes and you get what you deserve"!

Best of luck with it
Rebecca

I know Miss Ribena, the vitamins thing does sound a little bizarre! I actually have a problem with my blood - I have to take "conventional" medicine for it every day (which, incidentally, costs me €70 a month) but I also try my best with vitamins and herbal remedies too

Re: That's where it goes

Sometimes I am so tempted to get a credit card, but I know that this wouldn't be good in the long run

No harm in having a credit card if you manage it properly - e.g. clear the bill each month before interest charges kick in. However if you think that you're struggling (even in relative terms) on a net income of €2,300 per month and with a €250 per month subsidy on the mortgage from the folks then I would have serious reservations about managing a credit card properly so it probably is a bad idea. Sounds to me like part of the problem is "status envy" towards the situation you believe your friends to be in. I'll part with what I think is an apposite quotation:

"If one only wished to be happy, this could be easily accomplished; but we wish to be happier than other people, and this is always difficult, for we believe others to be happier than they are."

MONTESQUIEU

Re: That's where it goes

ClubMan, I think you have a very bad impression of me! I have actually had credit cards in the past - I owed IR2,000 on one and IR2,500 on the other. I had these while I was a student, and managed to pay both of them off. I have also paid back two student loans - one which I took out to pay for doing a Masters. I have paid these back as well - though it killed me doing it!!! So, it has't been without a struggle that I am not in my plastic-less debtless position! : 0 ) The €75 a month for conventional medicine is a bit of a burden. I was in hospital for a week last year and had a lot of doctors bills around that time as well.
I really want to start saving because I want to have some money put aside for the unplanned stuff that often happens. I suppose I just don't know how to save.

Re: That's where it goes

noor - to put things in perspective, your old credit card bill from your student days is only equal to one months gross salary at the moment so it is not huge relatively speaking.

I really think you need to just sit back and decide which expenditure you can do without and cut it out.

What are you going to do when your parents stop subsidising your mortgage ? Where are you going to find the extra money ? Now would be a good time to start thinking about it.

Don't get me wrong - I do think you are approaching this the right way by seeking advice, but in the grand scale of things you are in a good position. It just needs to be fine-tuned.

z