Wednesday, June 25, 2008

Household Spending

I have just been looking at the average household spending for the year and the average monthly figures are as follows :

Council Tax - £88.16
Utilities - £138.63
Car and Travel - £137.61
Children - £167.69
Luxuries - £219.13
Cash - £63
Food and Household - £572.28
Cleaner - £84
Insurance - £66.68
Mortgage - £1644.38
Savings - £767

There are some which I have little or no control over such items as council tax, utilities, car and travel, insurance and cleaner. However, it would be good to cut down the luxuries, cash and food and increase the Mortgage payments from it. For example if I could reduce the luxuries by £100 a month and reduce the food by the same amount, I could put an extra £200 a month against the mortgage which would be an extra £2400 a year.

I have records going back to 2001 and have looked at my average spending then. I was just married and was living at the same house, with the same mortgage. we had no children then. Our average monthly spending was :

Council Tax - £97.72
Utilities - £190.18
Car and Travel - £819.35
Children - £0
Luxuries - £718.02
Cash - £0
Food and Household - £201.54
Cleaner - £0
Insurance - £38.12
Mortgage - £399.41
Savings - £139.36

An interesting difference is the total spending - in 2001 it is £2064 and in 2008 it is £3948 . There are a few explanations for this. The addition of children, a cleaner and massively higher food bills (almost 3x higher). The utilities have increased a little and the council tax and insurance has gone up a bit (this is not reflected in the figures due to both years not being full ones). The car expenses seem a lot less but in 2001 we paid off a £3000 car loan so this is not an accurate representation. Luxuries have been cut a lot since 2001 which is great. The biggest difference are the savings and mortgage figures. Our savings have increased by about £600 and the mortgage figure was interest only in 2001 and although the interest has increased by over £300 the repayments have increased by £1100 a month which is fantastic.

Obviously we have had an increase in income both due to my husband earning more and me making more money from my business.

Goals
- decrease average monthly spending by £200 by reducing food spending and luxuries
- earn more money from business
- increase mortgage overpayments by at least £200 a month (£2400 a year) hopefully by £500 a month (£6000) a year.

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