At the beginning of last summer I checked the joint bank account and was surprised to find that we were in our overdraft for the first time ever.
Usually, this account has a healthy surplus of £1,000 to cover unexpected costs like replacing a broken washing machine or paying for car repairs.
For years, my husband and I have been overpaying into the household finances by £150 a month and this tactic has worked. But by June last year the surplus had gone.
When I dug into the detail I realised we had a £350-a-month deficit, which had been nibbling away at our buffer. So if we wanted to stay afloat and build our reserve we needed to find an extra £500 a month.
We started by moving £500 from our savings to cover the overdraft and bulk up the joint account again. This is the account where my husband and I put in a lump sum from our personal accounts each month, in order to cover all household costs including bills, food and kids activities.
Then I had a hard look at the figures. Our gas and electricity bill had risen by 130%, council tax had gone up by 33% and our weekly shop was reaching £120.
I have always prided myself on being a savvy consumer. We regularly switch utility and insurances companies to get the best deal, we shop at Lidl and we have a strict budget for birthday and Christmas presents which means we often use charity shops. So when I realised we needed to find £350 to £500 a month I did wonder what on earth we could cut down now.
As a family of four with two active boys, we do get through a lot of food but I knew tackling our weekly shop would be the best way to save money. The first thing to axe was the £18-a-week vegetable box delivery. Instead I replaced this with the £1.50 wonky veg Lidl box. This meant getting to the supermarket on the dot of 8am each Thursday to grab one before they disappeared.
Once I had picked up a box, this informed the weekly meal plan. We usually buy food according to what is low in the cupboards but we decided to be far more regimented and only buy exactly what we needed.
If there was a squash in the box then squash risotto would be on the menu that week. If there were lots of Brussel sprouts then a sprout and prawn noodle stir-fry would be added to the plan.
By being far more efficient we have been able to get our Lidl shop down from £50 to £60 a week. They also have a loyalty card, which means you can get 10% if you spend £200 in a month, plus other minor discounts on individual products.
Another expense that I decided to cut was the dog walker.
Although I work from home, some days are really busy and I had been using a walker twice a week to take our puppy out for a long walk and to socialise with other dogs. This was adding up to £120 a month. So instead of using the walker I started to get up at 5.30am to take Zippy out for an hour or more, before getting ready for the school run.
We have also started doing little things around the house to try to keep our energy bills down, and so far it seems to be working. Our dishwasher has been on its last legs for a while so instead of replacing it we now wash up. We measured the energy usage of the dishwasher versus washing up via our smart meter and washing up seems to be about 30p cheaper a time.
We also refuse to put the heating on, even as it is getting colder because it sends the smart meter rocketing. Instead we use offcuts of wood from my husband’s cabinet-making firm and forage for logs and branches, which we then use on our log burner to keep the house warm.
To bring some extra cash into the house I decided to increase the fees that I charge for my women’s running coaching. Although this was a 22% increase, at £22 a month I believe my membership is still good value for money.
But the biggest change we have made is taking part in the Homes for Ukraine scheme. We were keen to help because we have a spare room and felt there was no reason not to take someone in.
But we also considered the cost benefits. The £350 monthly thank you payment was the perfect amount to plug our household finance gap and together with our other measures could help us to build up an emergency fund again.
Our guest, who arrived in August, receives Universal Credit so is able to buy her own food. The only cost to us is additional energy usage but so far this has been minimal.
After a three-month delay we finally started receiving our thank you payment, which means that we can now bring the bank balance back into equilibrium and start building up a reserve.
And when it came to Christmas shopping, we funded it by selling old furniture and children’s toys on Facebook Marketplace, raising £150. This was enough to cover the cost of a second-hand bike, books from the local charity shop and second-hand video games.
Goals for 2023
1. Plan meals and stick to a food budget
This makes the biggest difference to our finances so we’ll be sticking with it. We’ve put a whiteboard in the kitchen and each Friday we meal-plan, write it on the board and then write the shopping list. My husband and I are vegetarian so this helps to keep costs down but we cook the kids a couple of meat-based meals a week. I refuse to buy puddings because it costs so little to bake a cake, make flapjacks or biscuits, and it’s a nice weekend activity on a cold winter’s day. My husband always comes back from the supermarket feeling very smug when he has spent less than £50. Meanwhile, every Thursday I continue to get the £1.50 veg box, so we can plan our meals based around it the next day.
2. Keep supporting our Ukrainian guests
We feel very fortunate that we can help a husband and wife from the Ukraine to have a safe home to live in. Our friends say we are extremely generous and kind but in reality it has been mutually, and financially, beneficial.
The Ukrainian couple are planning to stay with us until May so we will continue to save the thank you payments to ensure we have money for rising household fuel bills in April and can still take the children on staycation in the summer.
We haven’t decided whether we will host again after our guests leave us for rented accommodation but the financial implications will definitely be part of this decision.
3. Buy secondhand and reduce consumption
The kids are becoming experts at spotting gems in second-hand shops and we’re keen to cut consumption because of its detrimental impact on the planet. My son is learning how to sew – handy when his trousers get worn through – and we are continuing to shop for clothes and gifts in charity shops and via online marketplaces. The kids are also keen to sell old toys and put the money in their savings account, so that if there is something new they really want they can buy it themselves. Educating them about the value of money is so important.
I have also discovered a food outlet store, which sells items for as little as 10p, so I stocked up on stocking fillers and confectionery gift boxes for the extended family for less than £20.
Giving up alcohol has also saved me a fair bit of money and means on a night out with friends I spend around £10 rather than £50 as I am not buying wine or paying for a taxi home.
This Christmas the focus was very much on spending time with the family (without a hangover) and lessening our impact both on our wallet and on the planet by reducing excessive consumption.
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