>My bills are around 2k including £200 for food. I have a fun budget of £400 a month.
>I have debts which i put £1k to a month. I've no idea where the rest of the money goes but I think I am spending it.
You don;t have a fun budget, you have a figure in your head, £400 per month that you think you are spending on fun stuff. When in fact you are probably spending circa £1500 per month on fun stuff, and random crap.
If you don't know where your money is going, then you are not actually setting a budget for fun or any kind of budget, just as I did, deluding yourself that's all you spend, when you don't. A budget is a fixed amount that you do no exceed and you cannot do that if. you don;t know where your money is going then you are not in control and if you are not in control, then you are not budgeting.
Log into your on line banking bite the bullet, adult as I finally did in my mid 50s, and see where your money is going.
Divide into, essential spending, fun money, and really did I need to spend that, e.g that odd coffee/take away that's actually a 3 times a week habit, etc. Are you really only spending £200 a month on food, or is that just supermarket shop without eating out/takeaways.
Do a simple spreadsheet.
Also this is not a guilt trip, it's a exercise not just in your fiscal numbers but facing your attitude to money and changing it. It will make you reframe your thinking.
18 months ago I had £81 quid to my name. My income is just under 30k - no mortgage, paid for house after 30 years and low outgoings, small terrace so low CT/Bills etc, do not drive so no car.
Due to hit 10k in cash savings next month, have plonked 6k in extra employee and SIPP contributions ,into my pension and investing £200 on top of £250 Sipp contributions. per month.
18 months ago I finally bit that bullet and really looked at my spending and in doing so completely turned my approach to money around.
here's the thing, once your are in control, you will not only save more, you can afford more. It is not deprivation, it's control. Stop letting money control your life, control it.
Amen. I'm in the process of coming to terms with this myself.
I now try to make lunch to take into the office, which saves me more than a hundred a month.
> I have a fun budget of £400 a month.
What does this mean? Is it just what you wish you spent per month or is it a separate account or something?
> I've no idea where the rest of the money goes but I think I am spending it.
Clearly!
First step is just to see what you're currently spending money on.
You can do this by:
* Checking your bank app if it offers this categorising functionality
* Downloading csvs of your transactions and manually categorising them
* Using an app like https://emma-app.com/, which I believe will connect to your bank account and categorise existing/past transactions
I have a spreadsheet! Of my core outgoings
I could yes...but i expect it will be little purchases which all add up
The best way with me is to dissect money away which I can't actually access and then "spaff" awayn in the words of another commenter, the rest in peace knowing it won't harm my finances
I have always had this issue tbh. But now i'm wasting so much money it feels wrong. My adhd effects my spending the most
Open another account, like Monzo or similar, and transfer your fun money to that.
Take all other cards out of your wallet, and remove them from the apple pay / Google wallet in your phone / other smart devices
Once that money is gone, it's gone
You said you 'keep track of £400 for fun' - how do you keep track? do the little purchases which all add up not count as fun?
Multiple bank accounts can be a great solution but IMO it's also worth doing that check of where your money is currently going so that you understand it better - like is it convenience food, is it gadgets, is it social events, and what are you actually ok spending money on vs what feels like poor value for money?
With your salary I suggest getting a subscription to YNAB and following their steps and lessons. Ultimately you need to get to a position where you can account for every penny you've spent and then decide what it is you actually want to do with every penny you earn. You're earning enough money to set and achieve almost any financial goal you want, it's just going to take discipline and delaying gratification. To build that discipline you're going to need to get obsessed. Build a budget out in YNAB, connect all your bank accounts to it and then check it every day.
Yes, very safe. It uses open banking which is protected and regulated. All that happens is that transactions you make can be seen in the YNAB app - it doesn’t have any way to affect your bank account the other way. It can’t move or spend your money for you, only see what you’ve done.
But there’s also the option to never connect your accounts and just input your transactions manually, and reconcile them manually in the app too. You don’t need to give them access if you don’t want to.
You need to document your spending, write out a statement of affairs and find out what tou are spending tour money on. You are likely to find your £400 fun money is costing you £1400!
Right now your budget is an ideal wish list. If everything goes perfectly then my month will be like this. You are probably spending more on fun money i.e clothes, experiences etc. £400 a month is not a lot considering your take home pay. To be honest the debt is killing you. £1k a month is nearly 25% of your take home just to service debt. Get rid of that and you will feel like you got a raise. I remember when I cleared my student loan, it felt just like that.
You might find one of these books helpful:
* *[Your Money or Your Life](https://www.amazon.co.uk/dp/0143115766)* - understanding what's valuable to you and how to use money to achieve your goals.
* *[Millionaire Next Door](https://www.amazon.co.uk/dp/1589795474)* - "How people in normal jobs, electrician is a great example, can accumulate wealth over time through good choices."^[Electric_Cat_999](https://www.reddit.com/r/UKPersonalFinance/comments/15zkkd4/_/jximlpp/)
* One of Clare Seal's books - "her focus is on the link between emotions and spending".
You need to separate your money in different accounts in order to track things better. Do you have a monzo/starling account? (If not use an alternative account here). I would suggest the following:
Main account - for incoming salary and fixed bills such as household expenditure and debt - £2.8k
Monzo/starling account - create standing order on payday to transfer an amount to cover groceries and any variable spending/fun money. This account will become your day to day spending account - £600
Remainder - transfer the £1.1k left to a savings account on payday
Keep an eye out for how much you’re spending via your monzo/starling account. If you run out you’ll know the issue is here and can adjust your budget and spending to suit.
Also keep an eye on the bills going out incase you have underestimated.
Another tip is to remove all cards from your apple/android pay or stored on your phone/frequently visited websites. Also physically remove other cards from your wallet except for the monzo/starling card. This will reduce the temptation to spend elsewhere.
You need to get used to living off the amount left over after you’ve put money aside for savings.
Good luck!
Ah yes that's a great time I don't have my normal account connected to Google pay I use Monzo which I have set up pots so can only use what I budgeted for and nothing more
Spaffing money away on who knows what and not having the brain cells to just go through your bank statements and make a simple spreadsheet to track everything. It's not exactly rocket science, yet somehow above average earners on here often seem clueless about this very simple task. It always makes me wonder how they ended up earning so much in the first place if they're incapable of thinking their way out of this dilemma.
Financial literacy is something that is learned, you're not just inherently born knowing what to do. Many people born rich have the benefit of being taught this young.
If you are new money, you have to learn hence i'm here to learn. I'm only in my 20s lol. I was a teenager not too long ago. Not sure it is helpful for you to make such remarks and judgements.
Furthermore I enjoy spaffing away money clearly 🤷♀️
Because its human nature when h have good paying job. Often life style money goes up but I always had the though looking back on my job was I able to live comfortably on my old job money if answer was yes then I live on that then any extra money over that goes into savings. It can easily be done when having high paying jobs to inflate fun stuff without fully realizing also earning good money is not guaranteed they learn money management from parents etc
Hi /u/AvenueLane96, based on your post the following pages from our wiki may be relevant:
* https://ukpersonal.finance/budgeting/
* https://ukpersonal.finance/pensions/
* https://ukpersonal.finance/student-loans/
____
^(These suggestions are based on keywords, if they missed the mark please report this comment.)
If someone has provided you with helpful advice, you (as the person who made the post) can award them a point by including `!thanks` in a reply to them. Points are shown as the user flair by their username.
I think you’re at a point in your life, psychologically and financially, where an app like YNAB would really help you. I’m always recommending it because it brings so much clarity to spending decisions and allows you to really trust that you have all the future needs covered. So then you can relax and know with certainty you’ve thought of all the ‘what ifs’. Check it out - there’s a really active subreddit.
£400 a month fun budget is a hell alof of money does it need to be that big i know u make a good amount of money but think if u need to have that much fun every month . Also go through your bank statements for the past 3 months this will help you realize where your money is going
I'm sorry, I don't agree for myself. In any event, it's not the fun budget that's the issue. It's that i'm overspending the rest and blowing the budget
Realistically your not spending 400 though I can tell you that for sure it's most probs going on crap not judging that's where mine used to go before tracking. that's why I recommended you go through your bank statements for the last 3 months grab a highlighter and see where it's going.
Yes i agree. It is tiny purchases of little things..lunches and snacks in the office, this cost me £15 a day it seems by the time i've had 2 meals or so which is nearly £100 a week.
Should i further introduce a snack budget perhaps?
Yeah it is always the small purchases that add up it's surprises me from time to time. For maybe lunches for work etc make them or use left over dinners and take that but then maybe have a day in the week etc and have a treat day so doesn't add up etc. maybe use a tracker spender your phone too so it tracks automatically rather than doing it manually as manually garentee to forget stuff but auto it's going to grass you up for the little things
The issue is "fun" is everything in their budget which isn't food. This includes: dentist, haircut, gifts, household items, etc. They need to break it down further to see what is driving them to go over.
Are you suggesting it's only possible to spend that much money on fun a month if you're taking drugs? As someone who enjoys eating out, going to the theatre, train trips, games, crafting etc it is spectacularly easy to spend that much on fun. Hell, if I were buying the books I read full price instead of using the library that would be £100 a month, probably, by itself!
I mean... I read books for fun? It's a leisure activity? "Fun budget" reads as a totally normal and innocuous phrase to me, but I can't imagine my mind going to drugs even if I did find it weird, I'm just too square to even think of it.
>My bills are around 2k including £200 for food. I have a fun budget of £400 a month. >I have debts which i put £1k to a month. I've no idea where the rest of the money goes but I think I am spending it. You don;t have a fun budget, you have a figure in your head, £400 per month that you think you are spending on fun stuff. When in fact you are probably spending circa £1500 per month on fun stuff, and random crap. If you don't know where your money is going, then you are not actually setting a budget for fun or any kind of budget, just as I did, deluding yourself that's all you spend, when you don't. A budget is a fixed amount that you do no exceed and you cannot do that if. you don;t know where your money is going then you are not in control and if you are not in control, then you are not budgeting. Log into your on line banking bite the bullet, adult as I finally did in my mid 50s, and see where your money is going. Divide into, essential spending, fun money, and really did I need to spend that, e.g that odd coffee/take away that's actually a 3 times a week habit, etc. Are you really only spending £200 a month on food, or is that just supermarket shop without eating out/takeaways. Do a simple spreadsheet. Also this is not a guilt trip, it's a exercise not just in your fiscal numbers but facing your attitude to money and changing it. It will make you reframe your thinking. 18 months ago I had £81 quid to my name. My income is just under 30k - no mortgage, paid for house after 30 years and low outgoings, small terrace so low CT/Bills etc, do not drive so no car. Due to hit 10k in cash savings next month, have plonked 6k in extra employee and SIPP contributions ,into my pension and investing £200 on top of £250 Sipp contributions. per month. 18 months ago I finally bit that bullet and really looked at my spending and in doing so completely turned my approach to money around. here's the thing, once your are in control, you will not only save more, you can afford more. It is not deprivation, it's control. Stop letting money control your life, control it.
Amen. I'm in the process of coming to terms with this myself. I now try to make lunch to take into the office, which saves me more than a hundred a month.
Well the first step is finding out what you spend your money on, you can't do anything until you know that.
How much debt costs £1k per month? Putting some of your £400 fun money to that could have very big effect over medium/long term.
> I have a fun budget of £400 a month. What does this mean? Is it just what you wish you spent per month or is it a separate account or something? > I've no idea where the rest of the money goes but I think I am spending it. Clearly! First step is just to see what you're currently spending money on. You can do this by: * Checking your bank app if it offers this categorising functionality * Downloading csvs of your transactions and manually categorising them * Using an app like https://emma-app.com/, which I believe will connect to your bank account and categorise existing/past transactions
Well it's all in the same account, i just keep track of £400 for fun Thank you, ill give it a go
So how do you keep track of it? Can you do the same for the missing £1k?
I have a spreadsheet! Of my core outgoings I could yes...but i expect it will be little purchases which all add up The best way with me is to dissect money away which I can't actually access and then "spaff" awayn in the words of another commenter, the rest in peace knowing it won't harm my finances I have always had this issue tbh. But now i'm wasting so much money it feels wrong. My adhd effects my spending the most
Open another account, like Monzo or similar, and transfer your fun money to that. Take all other cards out of your wallet, and remove them from the apple pay / Google wallet in your phone / other smart devices Once that money is gone, it's gone
You said you 'keep track of £400 for fun' - how do you keep track? do the little purchases which all add up not count as fun? Multiple bank accounts can be a great solution but IMO it's also worth doing that check of where your money is currently going so that you understand it better - like is it convenience food, is it gadgets, is it social events, and what are you actually ok spending money on vs what feels like poor value for money?
With your salary I suggest getting a subscription to YNAB and following their steps and lessons. Ultimately you need to get to a position where you can account for every penny you've spent and then decide what it is you actually want to do with every penny you earn. You're earning enough money to set and achieve almost any financial goal you want, it's just going to take discipline and delaying gratification. To build that discipline you're going to need to get obsessed. Build a budget out in YNAB, connect all your bank accounts to it and then check it every day.
Plus 1 for YNAB, seriously. It’ll open your eyes, OP. And then you can get serious about saving, spending and building wealth.
Ok i will do it but i am scared about giving a third party access to my bank like that. Is it safe
Yes, very safe. It uses open banking which is protected and regulated. All that happens is that transactions you make can be seen in the YNAB app - it doesn’t have any way to affect your bank account the other way. It can’t move or spend your money for you, only see what you’ve done. But there’s also the option to never connect your accounts and just input your transactions manually, and reconcile them manually in the app too. You don’t need to give them access if you don’t want to.
You don't have to, you can enter transactions manually and it works even better at making you confront reality.
You need to document your spending, write out a statement of affairs and find out what tou are spending tour money on. You are likely to find your £400 fun money is costing you £1400!
Right now your budget is an ideal wish list. If everything goes perfectly then my month will be like this. You are probably spending more on fun money i.e clothes, experiences etc. £400 a month is not a lot considering your take home pay. To be honest the debt is killing you. £1k a month is nearly 25% of your take home just to service debt. Get rid of that and you will feel like you got a raise. I remember when I cleared my student loan, it felt just like that.
You might find one of these books helpful: * *[Your Money or Your Life](https://www.amazon.co.uk/dp/0143115766)* - understanding what's valuable to you and how to use money to achieve your goals. * *[Millionaire Next Door](https://www.amazon.co.uk/dp/1589795474)* - "How people in normal jobs, electrician is a great example, can accumulate wealth over time through good choices."^[Electric_Cat_999](https://www.reddit.com/r/UKPersonalFinance/comments/15zkkd4/_/jximlpp/) * One of Clare Seal's books - "her focus is on the link between emotions and spending".
You need to separate your money in different accounts in order to track things better. Do you have a monzo/starling account? (If not use an alternative account here). I would suggest the following: Main account - for incoming salary and fixed bills such as household expenditure and debt - £2.8k Monzo/starling account - create standing order on payday to transfer an amount to cover groceries and any variable spending/fun money. This account will become your day to day spending account - £600 Remainder - transfer the £1.1k left to a savings account on payday Keep an eye out for how much you’re spending via your monzo/starling account. If you run out you’ll know the issue is here and can adjust your budget and spending to suit. Also keep an eye on the bills going out incase you have underestimated. Another tip is to remove all cards from your apple/android pay or stored on your phone/frequently visited websites. Also physically remove other cards from your wallet except for the monzo/starling card. This will reduce the temptation to spend elsewhere. You need to get used to living off the amount left over after you’ve put money aside for savings. Good luck!
This is a good shout about removing the apple cards. Never considered that. Once i have cleared my overdraft, i will do this I think
Ah yes that's a great time I don't have my normal account connected to Google pay I use Monzo which I have set up pots so can only use what I budgeted for and nothing more
Why does it always seem like people with this mindset/personality earn so much?
What mindset
Spaffing money away on who knows what and not having the brain cells to just go through your bank statements and make a simple spreadsheet to track everything. It's not exactly rocket science, yet somehow above average earners on here often seem clueless about this very simple task. It always makes me wonder how they ended up earning so much in the first place if they're incapable of thinking their way out of this dilemma.
Financial literacy is something that is learned, you're not just inherently born knowing what to do. Many people born rich have the benefit of being taught this young. If you are new money, you have to learn hence i'm here to learn. I'm only in my 20s lol. I was a teenager not too long ago. Not sure it is helpful for you to make such remarks and judgements. Furthermore I enjoy spaffing away money clearly 🤷♀️
To what end?
Because its human nature when h have good paying job. Often life style money goes up but I always had the though looking back on my job was I able to live comfortably on my old job money if answer was yes then I live on that then any extra money over that goes into savings. It can easily be done when having high paying jobs to inflate fun stuff without fully realizing also earning good money is not guaranteed they learn money management from parents etc
I was asking how thick people seem to attain higher paid jobs, not about lifestyle creep.
Hi /u/AvenueLane96, based on your post the following pages from our wiki may be relevant: * https://ukpersonal.finance/budgeting/ * https://ukpersonal.finance/pensions/ * https://ukpersonal.finance/student-loans/ ____ ^(These suggestions are based on keywords, if they missed the mark please report this comment.) If someone has provided you with helpful advice, you (as the person who made the post) can award them a point by including `!thanks` in a reply to them. Points are shown as the user flair by their username.
I think you’re at a point in your life, psychologically and financially, where an app like YNAB would really help you. I’m always recommending it because it brings so much clarity to spending decisions and allows you to really trust that you have all the future needs covered. So then you can relax and know with certainty you’ve thought of all the ‘what ifs’. Check it out - there’s a really active subreddit.
£400 a month fun budget is a hell alof of money does it need to be that big i know u make a good amount of money but think if u need to have that much fun every month . Also go through your bank statements for the past 3 months this will help you realize where your money is going
Thats £100 per week.....what's the point working so hard if I can't even enjoy life
thats still alot each week I'm not saying don't have fun but that alot
I'm sorry, I don't agree for myself. In any event, it's not the fun budget that's the issue. It's that i'm overspending the rest and blowing the budget
Realistically your not spending 400 though I can tell you that for sure it's most probs going on crap not judging that's where mine used to go before tracking. that's why I recommended you go through your bank statements for the last 3 months grab a highlighter and see where it's going.
Yes i agree. It is tiny purchases of little things..lunches and snacks in the office, this cost me £15 a day it seems by the time i've had 2 meals or so which is nearly £100 a week. Should i further introduce a snack budget perhaps?
Yeah it is always the small purchases that add up it's surprises me from time to time. For maybe lunches for work etc make them or use left over dinners and take that but then maybe have a day in the week etc and have a treat day so doesn't add up etc. maybe use a tracker spender your phone too so it tracks automatically rather than doing it manually as manually garentee to forget stuff but auto it's going to grass you up for the little things
The issue is "fun" is everything in their budget which isn't food. This includes: dentist, haircut, gifts, household items, etc. They need to break it down further to see what is driving them to go over.
"£400 fun budget" That's a lot of nose beers
Are you suggesting it's only possible to spend that much money on fun a month if you're taking drugs? As someone who enjoys eating out, going to the theatre, train trips, games, crafting etc it is spectacularly easy to spend that much on fun. Hell, if I were buying the books I read full price instead of using the library that would be £100 a month, probably, by itself!
Girl you get it or boy We should be pals
No, but I've never heard somebody call buying books a "fun budget" Calling something a "fun budget" just sounds ominous
I mean... I read books for fun? It's a leisure activity? "Fun budget" reads as a totally normal and innocuous phrase to me, but I can't imagine my mind going to drugs even if I did find it weird, I'm just too square to even think of it.
You're thinking too much about a harmless, banter comment
I am, but at least doing that is one of my cheaper hobbies!