# How to increase savings?



## Switzwo (30 Jun 2008)

Age:28 
Spouse’s/Partner's age: 30

Annual gross income from employment or profession: 51,000 Public Sector
Annual gross income of spouse:55,000 Self Employed

Type of employment: e.g. Civil Servant, self-employed 

In general are you spending more than you earn or are you saving? Spending

Rough estimate of value of home: 430k
Amount outstanding on your mortgage: 300k
What interest rate are you paying? 4.9% Tracker

Other borrowings – car loans/personal loans etc - Car Loan 317 per month and finishes in July 2009. Credit Union Loan 3,200 left.

Do you pay off your full credit card balance each month? No
If not, what is the balance on your credit card? 2,300

Savings and investments:7,000 in credit union

Do you have a pension scheme? Yes through work

Do you own any investment or other property? No

Ages of children: None

*What specific question do you have or what issues are of concern to you?*

We would like to start a family shortly but I am concerned with our spending habits. Having looked at our bills and mortgage which go out of my account we are left with approx. 500 a month from my money which we seem to have been dipping in to quite a bit for one thing or another like weddings and birthdays etc.

I am concerned that when we have a child money will be very tight, I believe creches are approx. 900 per month which means using our living money to pay for childcare. Should I set up a direct debit from my salary to the credit union and include some savings? I would have thought that we were earning fairly good wages but we don't save much which worries me. 

We are trying to pay off credit card as quickly as possible so money left at end of July will go to that. We still have a few bits and pieces to do in our house which are going to get done as we can afford it. Now that I have started writing this I'm not 100% per cent sure what I am looking for but I would value some opinions on how we might proceed from here. Sorry for rambling but if anyone has comments I would appreciate it.


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## niceoneted (30 Jun 2008)

For a start I would use the 7K that you have in savings with the credit union to clear the credit union loan and the credit card debt. Try and live without the credit card for a while. 
What are the mortgage repayments per month?
Look at your household bills like gas and electricity and see if you can cut these back...turning off lights and appliances when you don't need them, using the energy saver lights. 
What I do and I find great is to have a separate Budget account (thats what I call it). I look at all my definite expenses for the year, gas, electricity, car tax, insurance, tv licence etc. I try to work out what they cost me weekly (as I get paid weekly) and put that money by. I also put 15 euro a week for thinks like birthday and wedding presents and money for things like hair and beauty treatments and the likes. I often don't need to touch this money. 
Look at your shopping bills and see can you cut back a bit or shop around for better competition. If you have sky with all the premium channels do you watch them and need them? 
Do you buy clothes/shoes etc every week? Can this be cut back. How often do you go out. what about making lunches instead of eating out. Eat out one day a week instead. There are lots of other ways to cut back but hope this helps. you should be able to save on that income.  
Good luck


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## annR (1 Jul 2008)

Do up an excel spreadsheet and figure out how to keep track of where your money is going.  Then use it to budget.  The miscellaneous stuff like weddings and birthdays can always be done cheaper - I don't think people really care if they get a gift worth 25, 50 or 100 euro.


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## anon473 (1 Jul 2008)

You should look at the key posts in the makeover pages. Your post is similar to many others on this board and the answers you will get will be similar as well!
Its difficult for us to guess your outgoings without more detail but it is quite probable that most of your money is disappearing into the black hole of discretionary spending.
A spending diary will show this up fairly quickly. Again the key post http://www.askaboutmoney.com//showthread.php?t=62751 on how to cut your day to day spending has many good tips (as does the Motley Fool http://www.fool.co.uk/ amongst others)

Remember that you will be entitled to Child benefit (160 per month) and early childcare supplement (1000 per year for the first 6(I think) years) and that your spending pattern changes when you have kids (Eating out less, childcare more).

Overall it appears that you have good incomes, not unreasonable level of mortgage debt (maternity break notwithstanding), small unsecured debt that you are actively paying off (Wipe the CC as soon as possible - the interest rates are often very high). Car loan is only for another 12 months (which will obviously free up more cash). You should be able to save a "good" amount per month. In reality you should probably pay off the debts before you save - check the T&Cs for the car loan to see if you can pay this off early.

You need more information on where your money is going and then you need to prioritse accordingly.

Anon473


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