We can’t make ends meet on £50k a year
THEY have nice homes, cars and Sky TV. And with an enviable household income of more than £50,000 a year — the average UK salary is £26,500 — why not? But according to a survey, a third of middle-class families would not be able to pay an unexpected bill of £500, while 31 per cent said they’d be left in debt. So where does the money go? Here, four families explain why they’re so broke at the end of every month...
WE’VE HAD NO TRIPS ABROAD SINCE 2012
MICHELLE TAYLOR, 35, is a researcher for a digital agency, earning £22,800 a year, and lives in Lightwater, Surrey, with husband Alex, 40, head of testing for a digital agency, who earns £35,000. They have two daughters Amelie, five, and Amber, 18 months, and a two-week-old son, Deacon.
GROSS JOINT YEARLY INCOME: £57,800
TOTAL JOINT MONTHLY TAKE HOME INCOME: £3,449 (Michelle £1,381 and Alex £2,068). OTHER INCOME: child benefit £192 a month. TOTAL MONTHLY TAKE HOME: £3,641.
MONTHLY OUTGOINGS
MORTGAGE: end-of-terrace £500 home.on their four-bedroom CHILDCARE: £975 on childminder. UTILITY BILLS (including gas, electric, home phone, mobile phones, broadband, insurance and council tax): £1,180. CAR COSTS (inc. petrol, tax and insurance): £600 for Mini Countryman and Kia Sportage. PUBLIC TRANSPORT: £100. GROCERIES: £500. CLOTHES: £0 unless the kids need something. Try to buy secondhand on eBay or get hand-me-downs from family. CLUBS/GYM MEMBERSHIP/SWIMMING: £90 (£40 for Alex’s gym membership, £50 a month on yoga classes for Michelle). GOING OUT/TAKEAWAYS: None. HOLIDAYS: None. PETS: £20 a month on a guinea pig. HAIR: £33 for Michelle (£100 every three months). £8 a month for Alex. CREDIT CARD REPAYMENT: £250. TOTAL: £4,256.
MONEY LEFT OVER EACH MONTH: £615 OVERSPEND
MICHELLE SAYS: When our boiler went kaput earlier this year we had to pay for the £1,500 replacement on our credit card because, despite our seemingly healthy incomes, we have no savings, no pensions, £10,000 of credit card debt and are constantly down to our last penny.
I work really hard, and am neither extravagant nor wasteful, yet I have nothing to my name at the end of each month. I can’t even justify a new pair of tights. How can that be right?
Alex and I haven’t had a date night since our wedding anniversary last September nor a foreign holiday since 2012. Holidays now are visits to see Alex’s family in Devon.
I log all our income and outgoings on a spreadsheet and spent an entire day recently contacting energy and insurance providers to find more competitive rates.
My parents have helped: Dad with the deposit on our first flat and Mum with childcare, two days a week, when Amelie was born.
But Mum fell ill while I was on maternity leave with Amber and we are now reliant on childcare — three days a week with a childminder, who charges £5.50 an hour — for Amber while I’m at work, and two days before and after school for Amelie.
Alex works from home on the third day so he can do the school run and save a little money.
Now I’m on maternity leave for a third time, we are frantically searching for more ways to save. This baby was unplanned and, though wonderful, is adding to our financial pressures. I will return to work three days a week when Deacon is nine months old, at which point childcare costs will double. I’m training as a yoga teacher to top up my income. But I refuse to compromise on buying good-quality food, including meat from the local butcher, plus fresh fruit and veg as it’s important that we eat healthily.
Financially, it doesn’t make a lot of sense for me to be working, but I wish to be a good role model to my children and don’t want Alex to shoulder all the burden.
He doesn’t show stress, but I think he must feel the pressure of being the main breadwinner for a growing family at a time when the cost of living is rising faster than salaries.
Our priority is to keep surviving — and try not to build up more debt.
OUR OLD HOUSE EATS MONEY
LISA SHERWOOD, 38, and husband Gavin Smith, 42, live in Bromley, Kent, with their sons James, four, and Joseph, two. Lisa is a legal clerk who earns £34,000 a year and Gavin is a tutor at a training centre, on a salary of £22,000.
GROSS JOINT YEARLY INCOME: £56,000
JOINT MONTHLY TAKE HOME: £3,400. (Lisa £1,850 and Gavin £1,550). OTHER INCOME: £137 a month for child benefit. TOTAL MONTHLY TAKE HOME: £3,537.
MONTHLY OUTGOINGS
MORTGAGE: CHILDCARE: terrace£929 £1,200. on house.a threebedroom CAR UTILITY COSTS: BILLS: £65 £334.on a Ford Fusion. month PUBLIC to TRANSPORT: commute Train,to London.£140 a GROCERIES: £350. CLOTHES: £50. SWIMMING LESSONS (for James): £18 a month. GOING OUT/TAKEAWAYS: £100. HOLIDAYS: £83 (average based on £1,000 a year). CHRISTMAS AND BIRTHDAYS: £54 (average based on £650 a year). PETS: None. HAIR/BEAUTY: £10. CREDIT CARD REPAYMENT: £200 (balance now stands at £500 on a debt of £3,000 which was used to pay for double glazing two years ago). TOTAL: £3,533.
MONEY LEFT OVER EACH MONTH: £4
Lisa says: A household income of £56,000 a year puts us among the UK’s higher earners, yet always we’re down to our few pounds at the end of the month, if we’re lucky.
Childcare is the big drain: more than a third of our earnings goes on paying our childminder £11 an hour to look after the boys three days a week — Gavin and I cover the other two days.
We’re very lucky to have a threebedroom terrace, bought for £260,000 in 2009 before prices rocketed, but we still owe £165,000 on the mortgage.
It’s an old Victorian house that constantly needs work. Earlier this year we had to fork out £1,000 to have a crack on the outside of the property repaired and the gutters cleaned because rainwater kept dripping into the house.
We save as much as we can on groceries by cooking most of our meals from scratch. I deliberately shop in Tesco at the end of the day, when I know they knock down prices. I buy frozen fruit and veg, and bake my own cakes and biscuits. Days out can be prohibitively expensive, yet we really love spending time in the open air as a family. I’ve just invested in National Trust membership, which means it’s free to visit any of NT parks and sites.
We always dread the MoT coming round; our 2003 Ford Fusion is long past its best, but we cannot afford to replace it.
We do everything in our power not to go overdrawn. Hopefully, things will be more manageable when both boys are at school — James starts in September — but we’ll still need after school childcare until one of us gets home from work.
Our one indulgence is a night out each month. We go separately with friends because we can’t afford to pay a babysitter on top, and buy an occasional takeaway as a treat.
My father’s friend has a villa in Spain, and my dad pays for our flights out there most years, and Gavin’s parents have a caravan in Whitstable, otherwise we wouldn’t be able to afford holidays.
We bring in almost £60,000 a year — why is life still such a struggle?
WE BORROW FROM RELATIVES
RHIANNON STEVENS, 34 and Craig Harding, 34, live in
Brentwood, Essex with twins Jack and Amelia, eight, and 18 month-old Phoebe. Rhiannon is an advertising company media manager earning £39,000 a year while Craig is a resourcing manager for a carpet company on £26,000.
GROSS JOINT YEARLY INCOME: £65,000
JOINT MONTHLY TAKE HOME: £3,400 (Rhiannon, £1,900 and Craig, £1,500). OTHER INCOME: £190 monthly Child Benefit. TOTAL: £3,590.
MONTHLY OUTGOINGS
RENT: £1,000 for a three-bedroom terrace. CHILDCARE: £400. UTILITY BILLS: £550. CAR COSTS: £370 for a Citroen Picasso and Renault Megane. PUBLIC TRANSPORT: £190 for a rail season ticket. GROCERIES: £250. CLOTHES: £60. CLUBS/GYM MEMBERSHIP: £51. CHILDREN’S SAVING ACCOUNT: £60. AFTER-SCHOOL CLUB: £100 GOING OUT/TAKEAWAYS: £65. HOLIDAYS: £150 spending money (accommodation free). CHRISTMAS AND BIRTHDAYS: £250. PETS: £20 on a rabbit. HAIR/BEAUTY: £30. CREDIT CARDS: None. TOTAL: £3,546.
MONEY LEFT OVER EACH MONTH: £44
Rhiannon says: When you hear the figure £65,000 as a household income, you’d expect us to have a really nice lifestyle, with expensive holidays and shopping trips, but the truth is, Craig and I live in a constant state of nerves, dreading the arrival of an unexpected bill.
We have no savings, apart from the £20 each a month I put away for the children. When emergencies strike, we have to borrow money from our families. For hard-working, professional people in our 30s, going cap-in-hand to our parents is nothing short of humiliating.
The nursery fees for the twins, at £1,000, were crippling enough, but then Phoebe came along. She was a surprise baby, and while there was no question of not having her, it’s been an added cost that we simply didn’t foresee. We hadn’t kept any of the baby things from our first two children so we’ve had to buy everything again.
Yet, ironically, we are deemed too wealthy to qualify for child credit.
We rent a three-bed terrace which is very old-fashioned. We’d love to own our own home but it’s not a realistic option. It also makes us feel vulnerable because the landlords could sell at any time. The twins have already moved four times.
Some people might wonder why we need two cars, but they’re essential for us to be able to get to work and nursery.
We have a few luxuries: we justify our £100-a-month Sky TV package, as we rarely go out to watch films. Also, my gym membership is the only thing I have that’s truly ‘mine’ and I use it every day.
I rarely buy myself clothes, and I go for months without having my hair cut. We haven’t had a holiday abroad for eight years, but will stay for free at my mother’s caravan in Walton on the Naze, Essex. I take in a packed lunch to work and rarely treat myself to a coffee.
With the children’s clothes, I never take them shopping because I want to avoid ‘pester power’.
Instead, I’ll order essentials from a catalogue and spread the cost over time. We’re by no means on the poverty line, and I know I’m lucky to have a healthy, happy family. But really, there should be more rewards for working this hard. I BUY CLOTHES IN SUPERMARKETS SUSAN HARRISON, 48, works 28 hours a week as a hospice admin assistant, and earns £14,000. Husband Gordon is 43 and a community psychiatric nurse, earning £37,000. They have two children, George, eight, and Leah, seven, and live in Glasgow.
GROSS JOINT YEARLY INCOME: £51,000
JOINT MONTHLY TAKE HOME: £3,250 (Gordon, £2,200 and Susan, £1,050.
MONTHLY OUTGOINGS
MORTGAGE: £570. CHILDREN’S CLUBS: £132. UTILITY BILLS: £452. CAR COSTS: £495 for a Ford Fiesta and a Nissan Micra. GROCERIES: £664. CLOTHES: £100. HOLIDAYS: £100, plus £100 towards a future trip to Florida. CHRISTMAS AND BIRTHDAYS: £100. FOOTBALL SEASON TICKET: £50. GOING OUT (mainly weddings): £300. PETS: None. HAIR/BEAUTY: £20. CREDIT CARDS: None. TOTAL: £3,083.
MONEY LEFT OVER EACH MONTH: £167
Susan says: If we get through each month without the car breaking down or the roof springing a leak we consider ourselves lucky. The money isn’t there to pay for them, which seems ridiculous when you look at how much we earn.
We bought our three-bed bungalow 11 years ago for £150,000 using the money from the sale of the flats we each owned before we wed, which keeps the mortgage payments low.
Our biggest expense is food. I like to cook healthy meals from scratch, but fresh produce is so expensive. I buy frozen vegetables nowadays, and I can’t remember the last time we had steak or lamb.
I used to love buying clothes from High Street stores like Next. I wonder what that old me would think now, watching me buying outfits at the supermarket — literally piling them on top of the sellby date bread and dented beans.
Likewise, the children get a new set of summer and winter clothes each year — and that’s it. Our social life is limited and we rarely go out to pubs or restaurants.
As well as our regular spending, one huge expense for us recently has been weddings. We’ve had at least five close family weddings recently. Once we’ve bought presents, outfits, accommodation and travel it really adds up.
Holidays are in the UK. This year we have hired a house in Devon for two weeks. We are banking on good weather — picnics on the beach are so much cheaper!
We decided two years ago to start a savings account to save £6,000 for a holiday in Florida and are hoping to go in 2018. Anything we buy we save up for, but we did have to take out a car loan recently to replace my 13-year-old Polo.
I have a banking app on my phone and try to keep a track of the balance, but once the money is gone, it’s gone and we have to wait for the next month.
Years ago, I used to dream of retiring at 60. The way things are going, I’ll probably still be slogging to pay off the mortgage.
ARE YOU in the same position as these families — or could you give them some money-saving tips? Email your suggestions to femailreaders@dailymail.co.uk