This week, having had some time off work, I had some time to really think about our finances and what steps we might need to take going forward, to keep living within our means as we head towards retirement in the next decade.
In all honesty, I've been a bit of an ostrich over the years and I've never really known or asked how much it costs to run our house. I've tended to leave all that to OH, as he was the main breadwinner over the years, whilst I, being a stay at home mum or working part-time and earning significantly less, mainly concentrated on buying what we've needed on a monthly basis in terms of food/household expenses.
This week though, I decided to put on my big girl pants at long last, and asked him what our monthly bills actually amount to. It was quite an eye opener. I did this with a view to seriously contemplating our retirement finances, which are now less than 10 years away and how we might manage on a reduced income. It will be the ideal time to reconsider our joint finances and re-distribute the financial burden of all of the household and other bills, as there will be less disparity in our income in retirement.
There have been and still are things that I can do now to share the burden. LB has almost finished University and thankfully some savings I put aside for her have helped her to manage financially whilst studying. I'm not a great planner for big purchases such as cars, holidays, etc. but I have planned financially for LB's studying in the past and do plan for smaller expenses such as birthdays/Christmas. Putting money aside every month for these things does work quite well in spreading the cost and also reducing the stress of trying to find the money when needed. I realise that I now really need to get serious about planning for necessary bigger purchases for our family going forward. OH has plenty of other things to think about, so I feel it is easier for me to start the ball rolling so to speak.
Having had time to think about the amount of money I've been wasting lately, on things I don't really need or even use (i.e. Project Pan/charity shopping), it's made me realise that a lot of what I earn could definitely be better utilised by putting it aside to save up for a new car. So I've now decided to use my low buy year to this effect. Starting from this month, I'm going to start putting aside as much money as I can into a new car fund. This may be a couple of hundred pounds per month or less, it might even be more, but at least it will be something going towards this major future expense. I will also still be putting aside money in other savings too, where I can afford to, but my major focus will be the car.
We've had our current car, a hybrid Toyota Prius, since we bought it virtually new in 2012 and although it's still very reliable, we love it and don't intend to get rid of it anytime soon, we are starting to think that there will come a time when we will need a new car. OH is very keen to go fully electric and electric cars are very expensive. As a consequence, I think it's time to start seriously saving towards this.
It may possibly be the last car we buy, as we head towards retirement and it's going to be quite an outlay. I don't know that we'll buy one new, it will depend how much we manage to save, but such an expense does need planning and saving for, as I don't really want to go down the car financing or leasing route.
This February, I've been a lot more successful at curtailing spending on unnecessary things, and my expenditure has somewhat fallen off a cliff and reduced significantly. I've spent relatively little compared to some previous months and it feels a lot more sustainable financially. I think I've recovered from all the overconsumption of Xmas and settled back into living more frugally and simply and not wasting money. I'm hoping that it continues as we go through the year and I can make serious inroads into the car fund. It's good to have savings goals, as it keeps you accountable and gives you something to work towards and I'm looking forward to the challenge of saving as much as I can.
I'll keep you posted with my progress. Are you saving for any major purchases?
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