# advice on managing income



## bumblebe (5 Sep 2007)

Hello – I’m looking for some advice on managing money.

My boyfriend and I are on decent salaries and in secure public sector jobs. We enjoy our lives but maybe a bit too much as we despair of our inability to manage our money more effectively, particularly to spend less / save more. I’ve looked at the key post on money saving strategies and will implement these with immediate effect particularly the writing down everything you spend one. In the meantime I’d appreciate observations / comments on what we should be doing with our money to make better long term decisions.

We’re getting married soon but for the purposes of this discussion, the cost of the wedding is taken care of. We don’t have immediate plans to start a family. We’re in our late 20s.

Net monthly income:
Total: 7750 (split pretty much evenly between us)

Outgoings:
Mortgage: 1400 after TRS, 300k on house worth approx 430 (but who knows these days!)
No other loans or financial commitments 

Assets:
Home
Car
2k savings

Bills:
Total household outgoings including food, bills, travel expenses / petrol and insurances – maximum of 1500 per month

I know we are obviously spending a lot of money on ourselves but at least we’re not in debt apart from our mortgage (every cloud?!). Anyone and advice or comments on how we can plan better / what we should be doing with our money – reduce mortgage term/save in high interest account/buy a holiday home??!!


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## moondance (5 Sep 2007)

I think you should look at increasing your mortgage payments and your savings. You seem to have plenty to spare every month so I don't see the problem!


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## Madangan (6 Sep 2007)

You are in your late 20s so if you can afford to be having a great time dont feel guilty about it...go for it.

My only advice is now is the time to start pensions do it in 2007 and remember you will get presumably the top tax rate back plus your prsi so its tax efficient.  You should be able to put in at least €300 each every month without really noticing it based on your net income..


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## ClubMan (6 Sep 2007)

I agree. "Despair" in this context seems totally misplaced! If you are going to track your spending and see if/where savings can be made then that is a good idea. Perhaps you need to clarify your short, medium and long term goals and then see what sort of savings/investment options might be appropriate for funding these. The _AAM _and _IFSRA _guides to savings & investments linked from the _Savings & Investments_ forum key posts thread might be worth a read.


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## bumblebe (6 Sep 2007)

Ok I concede that despair is probably an exaggeration! I guess it’s more guilt that we should be making some sacrifice with our disposable income to start saving / investing- making our money work a bit. We’re starting to track all expenditure so that will throw up our weaknesses soon enough and I know in my heart and soul that we have scope to cut back without compromising on our enjoyment of life! I’ll also look at the savings and investment forums for tips on where to start…. We both have public sector pensions and don’t need AVCs to bring us up to full service at retirement age so ok on that score for the moment. Thanks again.


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## Bronte (6 Sep 2007)

The best way to start saving is to take a certain amount each month directly from your salary and put it into an account earning good interest from which you will not touch it.  On AAM there is a list of the financial best buys and I'd recommend you start there.  If you have a goal in mind for the money (car/holidaychildren) that would also help.


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## ClubMan (6 Sep 2007)

bumblebe said:


> Ok I concede that despair is probably an exaggeration! I guess it’s more guilt that we should be making some sacrifice with our disposable income to start saving / investing- making our money work a bit.


"Guilt" sounds no less extreme and misplaced to me to be honest. Why *should* you be making sacrifices? Unless you have specific short, medium and long term goals that need to be financed via suitable savings/investment strategies then there is nothing to feel guilty or to despair about. However maybe your unease arises from the fact that you may not have clarified these and put suitable plans in place? Perhaps you need to sit down and review your overall situation and goals/plans? Doing this with a dispassionate/objective third party such a good multi-agency intermediary or authorised advisor (ideally on a fixed fee paying basis) who can do a comprehensive fact find/financial review might be a good idea?


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## bumblebe (6 Sep 2007)

i don't think it's extreme... i didn't say i lie awake at night compeltely wracked with guilt or despair. the guilt is a vague feeling of guilt that we are whittling away all our disposable income each month. 
this is the feeling i was trying to express and don't think being pedantic in relation to vocabulary is necessary in this context.
in a nutshell we both are aware that we spend most of disposable income on having a good time and while that is fun for a while we'd like to cut back a little and use this money a bit better. 
as i said in my previous post i think that a close examination of expenditure and identification of areas where we could put some limits on our spending without undue hardship (for example dedicate a certain amount per month on clothes rather than buy what i see and like until the money runs out!). i will look at the savings and investments section to read up a bit before approaching an independent financial advisor who might be able to assist us in redirecting the spare cash.
thanks for the advice.


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## buzybee (6 Sep 2007)

What are you spending your money on each month?  You should have net income between you of 6350 Euros after mortgage payments.  

Do you go out to pubs regularly?   Do you get into rounds?  Maybe this is where some of the money is going.  It is very easy to pay 100 Euros for a round of drinks if you have a large group of friends.

Eating out for lunch can cost a lot, esp. if you buy lunch every day. You could easily spend 20 Euros a day between lunch & coffees.

Do you buy a lot of designer clothes ?  E.g. 1000 Euros for a top?

I don't really know where all your money is going, esp. as I net just over 2k a month, my mortgage is 400 Euros, and I still save about 400 Euros a month.  My husband doesn't contribute to the household exps, as he is financing the building of our new home.


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## Welfarite (6 Sep 2007)

I think your post is prompted from your sense of a shift in your life. You are planning to get married and to me the key pjhrase "no immediate plans for a family". This could be your goal: start a savings plan so that you are able to plan that family on a solid basis. At the moment your drifting along with no real need to save or worry. Down the line, if you're l;ucky enough to have kids, you will have to contend with possible cut back in working hours/income, creche fees, etc. etc.. You have a great chance to have a good lifestlye and save a little for the possible "bumps" (pun intended  ) on the road ahead!


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## ClubMan (6 Sep 2007)

bumblebe said:


> i don't think it's extreme... i didn't say i lie awake at night compeltely wracked with guilt or despair. the guilt is a vague feeling of guilt that we are whittling away all our disposable income each month.


Fair enough - I just think that *any *level of despair and guilt is an extreme reaction given your obviously generally healthy financial circumstances. Your second comment certainly suggests to me that apart from tracking expenditure and making cutbacks where feasible you should also be looking to identify/clarify/understand your short, medium and long term life goals and then looking for  savings/investment options suitable for financing these. Sounds simple but not necessarily easy. Lots of us (myself included) don't always do this as systematically as we could/should and can find it less hassle to trundle along a little aimlessly instead!


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## bumblebe (6 Sep 2007)

buzybee, i'm not suggesting we don't have capacity to put aside more, i just said that we haven't been doing it up to now. until we really start tracking we won't be sure but i would think most of the money goes on: nice holidays/weekends away; eating out ourselves and with friends; entertaining at home a fair bit (which is usually more expensive than going out!); concerts; i'm fond of pampering myself; quite generous with gifts to family and friends; also we've had a lot of weddings of good friends in the past couple of years so if you're not working within a budget you can sink a lot of money on them (staying in the hotel; present; new outfit; hair etc)

clubman, fair point about clarifying our goals, i can see the need to do that. in one sense though i suppose that depends on whether we can have children or not (i don't make any assumptions in that regard) they are two v different prospects so need to find a way to plan for either scenario! (your point here welfarite - a potential shift in proirities is probably at the root of it and i'm trying to work through that at the moment)


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## bumblebe (6 Sep 2007)

also forgot to say, we're only in our house 3 years and have sunk a lot of money into getting that right / buying furniture etc.


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## amtc (6 Sep 2007)

yeah but what's wrong with that?

I earn good money, go out a fair bit and save less than maybe I should. But that's my choice at the moment. 

In work, I sit beside a guy who saves every penny but has no social life etc., plus is famous for not buying his round 

As long as you keep a balance that should be fine. It is more important to me to enjoy my life rather than sit at home dialling into my Rabobank.


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## DrMoriarty (6 Sep 2007)

amtc said:


> ...dialling into my Rabobank.


Speaking of which, your situation doesn't sound a million miles removed from that of the (presumably fictional) Pádraig, this month's recipient of the (unquestionably real) Jill Kerby's 'straight-talking' [broken link removed].

She has some other vague-but-commonsensical suggestions [broken link removed] — apart from the nonsense about buying Lottery tickets, of course!

_(Maybe JK has a deal with the National Lottery as well as RaboDirect...?)_


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## csirl (12 Sep 2007)

> We’re getting married soon but for the purposes of this discussion, the cost of the wedding is taken care of. We don’t have immediate plans to start a family. We’re in our late 20s.


 
Ok, I can understand you wanting a couple of years of fun after being married. You are both in late 20s, so if you are planning on having a family, you'll probably be trying within max 3-4 years which wont be long passing, particularly if you are enjoying life. So maybe you should be looking at ways of preparing for this eventuality. [My wife has two friends who decided to postpone having kids until mid 30s - one to progress career, other for fun. Neither have any kids and probably never will - fertility problems are more common nowdays and many couples have difficulties if dont start by mid 30s. Both wish they had started trying 5 years earlier.]





> Mortgage: 1400 after TRS, 300k on house worth approx 430 (but who knows these days!)


 
Bearing in mind the above. I assume your house is a starter home? As you have disposable income and the energy to do up a house, have you considered moving to a bigger family sized home in a better location? Market is softening, so might be worth preparing now with view to moving in next year or two. You may not need the additional room now, but its easier to move house at this stage in your life.


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## nelly (25 Sep 2007)

Madangan said:


> You are in your late 20s so if you can afford to be having a great time dont feel guilty about it...go for it.


I agree however i think maybe you are feeling bothered that you can plough through money and not see anything at the end of the month - to show for your 7K+income - thats the point of this post, no?
If i were you I would save a bigger fall back on fund or maybe just start saving for the "once in a ifetime" ie 10k trip to South America, the car you always wanted, the apartment in teh sun etc. I would also just pay back a good chunk more in the mortgage and then forget about money and go and enjoy your lives together.


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