Try again. I know there are going to be sweeping changes made to the social welfare system in the UK sometime in the next year or two, so you want to get your foot in the door ASAP
This is true, it’s quite hard to find places like that these days though!
Not for many places in the U.K. it isn’t.
Horrifically high in absolute terms no, but in relationship to his income, yes no matter where he lives.
Yep, that’s immediately what jumped out at me. Get a roommate and halve that rent, and you’re in much better shape. As everyone said, 1/4 - 1/3 max of your take home pay is generally what’s considered a reasonable ratio.
I also don’t see why you’re spending money on taxis if you could walk to work of use public transport. I assume that eats into your budget a pretty good deal. Taxis in the UK (assuming that’s where you’re at) weren’t that cheap, IIRC. A couple pounds here and there over the course of a month, and you’re talking real money. How much do you spend on taxis? I mean, that’s–I’m guessing–at least 5 pounds a pop, right?
Yup. And as I said earlier, most people who live in expensive places usually have roommates to offset the cost of living there.
My rent and take home pay were just about identical to yours about 12 years ago. I think the council tax was a fraction less, but power was via one of those rip-off put a pound in meters, so over all fairly similar.
I didn’t drive (and still don’t). I used public transport or walked everywhere. I have yet to get in a taxi alone, which is a damn good habit derived from living in a village where a taxi back could easily cost 10 times more than the bus.
I chose to live within an hour’s walk from work. (it’s now an hour by bus, but I’m maintaining a similar principle)
I don’t smoke. (Well done in giving up!).
I very rarely went out. The cinema about once a month was about it.
I wasn’t going back and forth to Ireland every fortnight.
Let’s be honest, that’s where a good chunk of your money is going. Were I forced to guess, those trips must cost £100 a time once travelling and doing things that couples do are taken into account. Over a year that’s nearly all the savings you say you’ve gone through. Halving the frequency that you go to see her would mean you’ve only got to find about £30/wk saving on your current budget, which sounds almost manageable just by cutting out the taxis. Is there any reason why it’s always you going to her? That halving could be achieved by having her come to you half the time, and you’d see each other just as often.
I don’t think the 1/3 of your income in rent is an absolute rule, but it’s definitely the long term goal. I only broke it on the basis that I fully expected to be earning more in the not too distant future - it was my second job after graduating and my first after moving out from my parents. I was breaking even though, the Micawber Principle still applies:
[QUOTE=Charles Dickens]
Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
[/QUOTE]
Get to break even, then set half your excess aside when you get more money coming in - make damn sure that that point comes though. The other half can go on treats. You’ll hopefully reach a point where the treats are more than sufficient to maintain the level of civilised living you want. Then you can save more.
Cars: me neither. I once worked out that I was saving about £3000/year by not driving - fuel, insurance, tax et al add up. Not driving does require a radical change in your outlook, particularly when it comes to choosing places to live and work. I now live within spitting distance of a bus depot and a railway station and work is one bus or train journey away. Long term travel tickets are an absolutely phenomenal saving - my yearly bus pass works out at a touch over £2/day against what would otherwise be over £6/day.
It took 10 years for me to save for my first mortgage. I shared a house for nearly 5 years starting a couple of years after this time-frame, which worked wonders on my finances; I decided to budget as though I had to pay all of the rent seeing I could have just about afforded it by myself. All of that extra money I was pretending I didn’t have went into savings. A standing order into a saving account is very good for preserving that illusion. I’ve had 3 foreign holidays in that period, and two in the UK with my parents.
My nights out are fairly cheap, usually of the order of £20-25. That gets a meal, a couple of pints of decent beer and a concert by someone most people haven’t heard of or a stand-up that slightly more people have heard of. I average one a month these days and I really look forward to them.
Getting those rewards of civilisation without going spectacularly into debt trying is all about learning how to trade off how often you want them and how often you can afford them. Get that want rate below your afford rate and you’re laughing…
Download and use one or more of these budgeting spreadsheets. I couldn’t live without mine (though I created it myself and it’s highly personalized).
One really important budget category that most people forget to include in their monthly budgets are large annual expenditures such as insurance and taxes. If you have any large bills that come due once or twice a year, add all of them together, divide by twelve, and set aside that money every single month so it will be there when the bills come due and you won’t have to cut your regular monthly budget back, drain your savings, or go into further debt to pay them. I have that 1/12th amount automatically transferred from checking to savings by my bank every month so I can’t spend it and must save it.
Good luck!
Yeah, I’d use public transport to work, I do on the way home, just the way to work is awkward in relation to buses, I’d have to go back to town to go forward to work. I’ve walked regularly a few times, takes 40 mins to get there.
I’ll be honest and say it’s like a convenience, and it crept up on me, because it’s so convenient to just phone them up and be there in 5 minutes as opposed to nearly an hour, it frees up alot more time. I’m not justifying it, just explaining the rationale behind why I use them.
You use a taxi to speed up the journey IN? I hope your dedication is recognised…
The uninterrupted thinking time I get on the way in pays for itself.
A bike might reduce the time difference enough to remove the temptation. Don’t know if it’s an option, but spending £50 to save what you spend in taxis sounds a good investment to me.
The good news is that you’ve done a couple of big steps already…quitting smoking and doing your own cooking. But the bad news is that things like taking taxis is going to keep eating away all your savings. If you will look at the transport time as reading time, then you might be able to be happier about it. I used to spend almost two hours a day on buses, and I got a lot of casual reading done then. Granted, I had difficulty studying on the bus, but since I read for recreation, the time on the bus was practically “found” time. I’ve also done a lot of knitting on buses and trains.
Do a little math. How much time do you save by taking a taxi, and how much does it cost you in money? How much do you earn per hour? Are you willing to spend that much time, earning money, in order to pay for the convenience of a taxi? I’m phrasing this badly.
And you really do need to find other living arrangements.
Is it possible for you to get a part time job? With Christmas coming up, a lot of places want extra cashiers, or delivery people, or whatever. Even if you only work a Saturday shift, if you can do it for 5 or 6 weeks, you could put some of that in savings. If it turns into a permanent part time position, that’s good, but even if you only get a seasonal position, you can build up a savings cushion.
Doing the math it costs me £100 a month for taxis, coupled with smoking, I should be saving £300 by not doing those things.
Like I said, I get the bus home from work, just not to work because it would require me to go back to town and then get another bus to get there, which would work out more expensive than a taxi, so last resort is walking.
Can you find someone to carpool with and pay them less than the taxi for the petrol and inconvenience?
What do you do for a living? Can you find a better job? 900 sterling a month is not a good job.
I’m surprised it took 33 posts to ask this question. The problem isn’t on the spending side of the house. The OP is making less than 20,000 USD per year. OP, the answer to money problems is to make money. You’re not doing that.
I agree. I was surprised that this most basic question wasn’t asked.
Say what now?
Taxis = 100, Cigs = 200?
How can that be right?
OP, is this a mistake?
A pack a day in the UK could easily be £200 a month, depending on the brand.
Yeah, but…
900, less 480 (rent+), less 100 (taxis) only leaves 320 for every other thing.
Something seems terribly amiss to me! But, then, I don’t live in England, and have no understanding of pounds, so maybe it’s just me.
Do you pay to launder?
Do you have a pantry or freezer?
Do you go out to drink more than a couple of times a week? How much more is a drink at a bar than it is at the store?
Could you change your work hours so you’re commuting at a different, less frenzied time of day or work longer hours for fewer days?
Don’t trust your math.
Keep track of everything you spend for at least a full month. The actual numbers, not estimates. Use receipts and bank statements plus notes or a spreadsheet, whatever works for you.
You’ll probably find the true numbers are quite different from what you think.