May ’18 Income and Expenses

So it is already that time of the month again, and once again I can’t believe just how fast time is flying. Work is keeping me very busy (a good thing as I enjoy it – although I am sure I would prefer not having to work!) and a lot of things going on over weekends so really quite a busy little bee!

Income

So once again my (reduced) salary hit the bank account. This was a real kick in the unmentionables. My company share scheme purchases are still being deducted which reduces the income, and my new tax code kicked in, taking my income down even further. To say I had to watch the pennies this month would be an understatement. I really can’t wait for July when I get a full size pay cheque again, I just hope it is enough.

To date I have been continually dipping into my cash reserves and they are starting to look rather threadbare. I am sure most people don’t count a company share scheme as being an emergency, but there you go!

My other half’s ISA kicked out more money again which is always nice – a bit of tax free income, yes please! This is now starting to become more noticeable and although I said it should be going off the mortgage, for now it is helping cover the gap until I get a full income again.

Expenses

Item Notes Amount
Things I choose not to avoid* Mortgage, Insurance, shared bills etc. – yes, we could move somewhere cheaper, not have insurance, reduce our bills a bit and so on, but we are where we are.  36%
Groceries All the food and other stuff needed for home  2%
Alcohol for home Home alcohol consumption only 0%
Bicycles / Car related Any costs related to either the bikes or the car  1%
Alcohol Out Generally, its the pub….  1%
Eating Out I include purchased lunches in this as well as meals out etc.  4%
Other My catch all for anything I may have missed….  4%
Holidays Any spending related to holidays, flights etc.  0%
Savings Anything left over! This includes money into ISAs, mortgage payments and non relief pension contributions. My company pension comes out before it hits my bank account so isn’t included, nor do I include the “top up” of money when my money goes into my personal pension (i.e. I put in £100, I register it as £100, not the £125 that gets credited in my pension)  52%

* This covers a number of things that I would class as essential for me. Yes, I could move to somewhere cheaper to reduce the mortgage (which in turn would reduce the insurance I have to pay), yes I could reduce my bills by switching energy supplier etc. but it comes down to what I am happy with. There are a few other things in there that are classified as essential that others may object, and so I have just lumped it into there.

Day to day “Things I choose not to do anything about” is up slightly, reflecting my reduced income.

Food for home is lower than it really is as I did a big shop but used up more of my vouchers. Arguably I ought to include the income from these vouchers, and then the expense, but then as I don’t include my bonus / tax refunds etc. I am not going to bother. Reality is it won’t make that much difference to me when I pull the plug given how much buffer I expect I will have!

Eating out was a little high as we went out for a few meals, and I have started eating the odd lunch at work. One for another day.

Other was a little high – this was a few naughty taxis home after an evening out, eye / contact lens check and odd things like that.

Oh. My. God. 52% savings rate. This is my highest EVER! A combination of having to really cut back due to the decrease in pay, and not wanting to change my direct debit savings!

The reality is however never quite as pretty as it seems. Yes it is a very high savings rate, however to keep the £1,100 going into the GTP ISA not only did I not put anything into cash savings but I withdrew some to make sure it was covered. Not a sustainable position to be in.

And what happened to the insurance money I was paying, wasn’t that supposed to be going into the GTP ISA? Well… yes it was. I actually decided it shove it into my other half’s ISA. Hopefully in only a couple more years that will then start paying out enough to cover my day to day living (not expenses, mortgage etc. but the odd food bill, eating out etc.).

Now I have done that, I don’t intend to increase the contributions any further until I max my ISA out, so any future changes or increases will go into mine, and most likely into VWRL.

How was your May?

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Author: fireinlondon

Fighting the high cost of living in London

8 thoughts on “May ’18 Income and Expenses”

  1. Congrats on an awesome savings rate! Obviously not great that you’ve had to dip into your cash reserves but imagine if you didn’t have those reserves to dip into! Fingers crossed the tax situation will be sorted for you soon so it’s back to normal.

    The recent nicer weather (and longer days) has saved me on taxi fares – I’ve been inclined to walk home from the tram stop after Friday night drinks, instead of getting a taxi. I then walk to pick up my car the following day, so saving money and improving my health too!

    Here’s to a great June for you!

    Liked by 1 person

    1. Hi Weenie,

      Thanks – its a good result and hopefully when I get my normal pay cheque back I won’t have to dip into the reserves, but lets see. Yes the tax bit is not good – the latest calculation on my form (that I haven’t submitted!) showed I owed almost 6 months equivalent of income! Something isnt right!

      Haha very nice – a walk after some drinks is often nice, sadly for me it is just a bit too far even with the health benefits!

      Cheers, you too – fingers crossed for another warm month and no flooding!
      FiL

      Liked by 1 person

  2. May was good. I’ve been left an inheritance by my grandad (45k)so am just deciding what to do with this. Obviously not good he’s passed away but he was 87 and had alzheimers so a blessing truth be told

    My mum as also been left nearly twice this amount and is awful with money so I’m trying to help her with it if she’ll let me. I have poa so I’m able to help if she wants to. Sadly she’s already lying to me that she hasn’t seen any details when i know she has. Hopefully she’ll come around. She has a 70k interest only mortgage due in 13 years and some other debts (about 10k)and no emergency fund. Also living beyond her means My idea after paying debts and leaving her provision is to invest say 50k for her in either a simple 60/40 fund or something that will pay her an income (need to research this as never invested for income before.) What do you use in your other half’s isa if you don’t mind me asking.) that way the 50k should grow to cover the mortgage and if not by then i can probably clear it for her if the pot is down at that stage. Fingers crossed will see sense it literally sets my teeth on edge to think of her wasting it. O well you can’t choose your family…

    Liked by 1 person

    1. Hi FBA,

      Sorry to hear about your loss – even though it sounds as if it was better for your grandad it doesn’t make it any easier when you lose a loved one.

      Even worse when you know your mother won’t be good with her inheritance as well as it seems such a shame – if it were me I would just clearas much of that mortgage for her as possible as that would make a huge difference (IMO) and put the mortgage payments difference into a savings account (so she doesn’t notice the difference!) – or switch it repayment, all sorts of options.

      Afraid my other half’s ISA is a custom built portfolio (all funds) – combination of various global equities, corporate bonds, property, a very small amount of cash and some alternatives.

      If I were doing it myself I would probably do it with a few different Investment Trusts (you can get some that pay out monthly) to give a bit of income each month.

      Good luck trying to help your mother – as you say you can’t choose your family, but you do always want to support them when you can!

      Cheers,
      FiL

      Liked by 1 person

      1. Yeah i was thinking cty which i know you use as the yield is good on that but obviously won’t put it all in one fund. I’ll do some research

        Liked by 1 person

        1. Very sensible – you should be able to get a nice variety (I looked into setting up a “job” portfolio of IT’s that would pay out monthly, but never got around to it in the end!
          Good luck!

          Liked by 1 person

  3. Nice to have the flexibility to tighten the purse strings a bit and use cash reserves to hold you overt until you get your normal pay income again! And especially nice that you’re not having to sacrifice your investment contributions.

    May was a fairly normal month for us. Grocery was down a little which was nice to see. It was high the prior couple months so we focused on it more now. June is a three paycheck month for us so looking forward to that! Cheers!

    Liked by 1 person

    1. Hi JW,
      Yes – although more about really pulling back and it does hurt, so I will be pleased to get the normal pay coming back in!
      Glad that it was a good month and groceries down always helps a little – and sounds like June should be a great month then with that additional pay!
      Cheers,
      FiL

      Liked by 1 person

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