Where does your income go?
Discussion
Agree with most other comments. My two pence would be to be patient, OP.
I was earning the same amount at 23, always longed for more money. Now I’m still in my 20s earning a lot more.
I put it down to ambition and loyalty to a good company (pay rises, commission etc).
If an imminent pay rise is unlikely, you’re still in a strong position, although your debt is your weak link. Keep over paying the debt to get rid of it ASAP and suddenly you have so much more left over each month once it’s gone.
Once this is done, begin to stack the cash and start to pay off things annually, such as your TV license and car insurance, this frees up your monthly available funds for a whole year.
Last note is that I see your mortgage payment seems in the higher bracket for a 23yo, have you gone for the biggest mortgage possible? It seems all FA’s and brokers nowadays try to put young buyers on the biggest possible mortgages based on their affordability.
With brexit on the horizon and interest rates only going up, you may want to review this mortgage, and possibly downsize. It seems extreme, but I anticipate some big increases in mortgage rates in the next few years. Leaving those with big mortgages in a scary position.
Equity equity equity!
I was earning the same amount at 23, always longed for more money. Now I’m still in my 20s earning a lot more.
I put it down to ambition and loyalty to a good company (pay rises, commission etc).
If an imminent pay rise is unlikely, you’re still in a strong position, although your debt is your weak link. Keep over paying the debt to get rid of it ASAP and suddenly you have so much more left over each month once it’s gone.
Once this is done, begin to stack the cash and start to pay off things annually, such as your TV license and car insurance, this frees up your monthly available funds for a whole year.
Last note is that I see your mortgage payment seems in the higher bracket for a 23yo, have you gone for the biggest mortgage possible? It seems all FA’s and brokers nowadays try to put young buyers on the biggest possible mortgages based on their affordability.
With brexit on the horizon and interest rates only going up, you may want to review this mortgage, and possibly downsize. It seems extreme, but I anticipate some big increases in mortgage rates in the next few years. Leaving those with big mortgages in a scary position.
Equity equity equity!
Edited by roadsmash on Monday 24th September 08:01
roadsmash said:
Agree with most other comments. My two pence would be to be patient, OP.
I was earning the same amount at 23, always longed for more money. Now I’m still in my 20s earning a lot more.
I put it down to ambition and loyalty to a good company (pay rises, commission etc).
If an imminent pay rise is unlikely, you’re still in a strong position, although your debt is your weak link. Keep over paying the debt to get rid of it ASAP and suddenly you have so much more left over each month once it’s gone.
Once this is done, begin to stack the cash and start to pay off things annually, such as your TV license and car insurance, this frees up your monthly available funds for a whole year.
Last note is that I see your mortgage payment seems in the higher bracket for a 23yo, have you gone for the biggest mortgage possible? It seems all FA’s and brokers nowadays try to put young buyers on the biggest possible mortgages based on their affordability.
With brexit on the horizon and interest rates only going up, you may want to review this mortgage, and possibly downsize. It seems extreme, but I anticipate some big increases in mortgage rates in the next few years. Leaving those with big mortgages in a scary position.
Equity equity equity!
We're in the SE so our £220k mortgage was the smallest we could go for and bought us one of the cheapest properties - a 1 bedroom bungalow in the cheapest area we could find which was still commutable to work at reasonable cost! I was earning the same amount at 23, always longed for more money. Now I’m still in my 20s earning a lot more.
I put it down to ambition and loyalty to a good company (pay rises, commission etc).
If an imminent pay rise is unlikely, you’re still in a strong position, although your debt is your weak link. Keep over paying the debt to get rid of it ASAP and suddenly you have so much more left over each month once it’s gone.
Once this is done, begin to stack the cash and start to pay off things annually, such as your TV license and car insurance, this frees up your monthly available funds for a whole year.
Last note is that I see your mortgage payment seems in the higher bracket for a 23yo, have you gone for the biggest mortgage possible? It seems all FA’s and brokers nowadays try to put young buyers on the biggest possible mortgages based on their affordability.
With brexit on the horizon and interest rates only going up, you may want to review this mortgage, and possibly downsize. It seems extreme, but I anticipate some big increases in mortgage rates in the next few years. Leaving those with big mortgages in a scary position.
Equity equity equity!
Edited by roadsmash on Monday 24th September 08:01
We could have borrowed another 40k roughly, but wouldn't have bought us anything better than what we have now.
Simpo Two said:
Still interested to know how a £150.50pa TV licence costs £35pcm.
Typo, checked and its £25 pcm over 6 months. Testaburger said:
Jossman,
Just to echo the general sentiment on this thread, I’d be proud of your achievement so far. You’ve obviously made sacrifices to achieve your place on the property ladder at your age. At 23, that’s not to be sniffed at.
STUFF
-Wisdom
Thanks - You, along with many, are offering very useful advice and I'm planning on doing exactly that - plow plenty of income into my pension and try to make the most of the early start. Just to echo the general sentiment on this thread, I’d be proud of your achievement so far. You’ve obviously made sacrifices to achieve your place on the property ladder at your age. At 23, that’s not to be sniffed at.
STUFF
-Wisdom
Didn't look at this thread over the weekend but it's providing some interesting discussion! Thought provoking, certainly.
Thanks everyone.
@OP
at 23 : suggest you focus on how to grow your income / what career or work path is best for you / how you can achieve what you want to.
Your comments on budgeting and spending look fine.
Focus on the top line.
When in early - mid 20s I earned very very little as a graduate civil engineer (even with top Uni degree and top company) - so I worked my butt off to qualify as fast as possible / and worked overseas to save up to do an MBA.
So by 28 had completed the MBA and was earning Multiples of what I was as a project head in civil engineering.
I shifted from eng. work to commercial / corporate planning work.
I’m now not far off retirement having had several FD/ Finance head roles overseas.
Focusing on a career change / what needed to effect that in my mid 20s was worth it.
at 23 : suggest you focus on how to grow your income / what career or work path is best for you / how you can achieve what you want to.
Your comments on budgeting and spending look fine.
Focus on the top line.
When in early - mid 20s I earned very very little as a graduate civil engineer (even with top Uni degree and top company) - so I worked my butt off to qualify as fast as possible / and worked overseas to save up to do an MBA.
So by 28 had completed the MBA and was earning Multiples of what I was as a project head in civil engineering.
I shifted from eng. work to commercial / corporate planning work.
I’m now not far off retirement having had several FD/ Finance head roles overseas.
Focusing on a career change / what needed to effect that in my mid 20s was worth it.
£7-8k or so PM net (pending bonus etc)
Mortgage/bills and everything to do with house etc £1500
Groceries - maybe £150? (eat out often)
Phone £40
Car insurance/tax £80
Gym £20
Magazines/charity/spotify/strava other stuff I prob forgot etc - £60
I really should have more money in the bank than I do. But I think what has happened is that things I would never have thought OK to buy at 23, now are ok at 30. For a long time I didn't really alter my outgoings and just saved more, I tend to save about £3k a month now, but do dip into it every now and again for this and that, but its still not exactly flying up each month, so I only can assume that its going on food/booze etc.
You're doing well, I think I was in a similar position to you then, I bought a house at 25 with my GF, but that went down the pan, but I was quite ruthless in moving for cash between ages 24 and 28 (within reason).
Lucky for me all my outgoings are about to half as I move in with a new person, who earns about the same as me, should probably try to make hay!
Mortgage/bills and everything to do with house etc £1500
Groceries - maybe £150? (eat out often)
Phone £40
Car insurance/tax £80
Gym £20
Magazines/charity/spotify/strava other stuff I prob forgot etc - £60
I really should have more money in the bank than I do. But I think what has happened is that things I would never have thought OK to buy at 23, now are ok at 30. For a long time I didn't really alter my outgoings and just saved more, I tend to save about £3k a month now, but do dip into it every now and again for this and that, but its still not exactly flying up each month, so I only can assume that its going on food/booze etc.
You're doing well, I think I was in a similar position to you then, I bought a house at 25 with my GF, but that went down the pan, but I was quite ruthless in moving for cash between ages 24 and 28 (within reason).
Lucky for me all my outgoings are about to half as I move in with a new person, who earns about the same as me, should probably try to make hay!
Edited by okgo on Monday 24th September 12:04
Testaburger said:
It’s all too easy to let small incremental outgoings add up. Netflix, Hulu, phones, gym, cable tv, car insurance, car tax, gym, magazine, newspapers, etc.
+1This was something that slowly built up with me from my mid 20s. The number of monthly DDs going out were staggering in the end and a lot of it was just chaff. Things like gym membership that was used twice a year, various magazine payments, sofa on 0%, various club memberships, AA membership yet had a new car for ages with supplied cover, bla.. things I never used, etc.
Slowly reduced this to the point now where my DDs are down to basic utils and services, insurance, mortgage and Sky.
I still have some club memberships and stuff like that but no longer put them on DD to prevent auto renewal.
Also lucky in that phones and cars are paid for by work for both of us.
Jossman said:
roadsmash said:
Agree with most other comments. My two pence would be to be patient, OP.
I was earning the same amount at 23, always longed for more money. Now I’m still in my 20s earning a lot more.
I put it down to ambition and loyalty to a good company (pay rises, commission etc).
If an imminent pay rise is unlikely, you’re still in a strong position, although your debt is your weak link. Keep over paying the debt to get rid of it ASAP and suddenly you have so much more left over each month once it’s gone.
Once this is done, begin to stack the cash and start to pay off things annually, such as your TV license and car insurance, this frees up your monthly available funds for a whole year.
Last note is that I see your mortgage payment seems in the higher bracket for a 23yo, have you gone for the biggest mortgage possible? It seems all FA’s and brokers nowadays try to put young buyers on the biggest possible mortgages based on their affordability.
With brexit on the horizon and interest rates only going up, you may want to review this mortgage, and possibly downsize. It seems extreme, but I anticipate some big increases in mortgage rates in the next few years. Leaving those with big mortgages in a scary position.
Equity equity equity!
We're in the SE so our £220k mortgage was the smallest we could go for and bought us one of the cheapest properties - a 1 bedroom bungalow in the cheapest area we could find which was still commutable to work at reasonable cost! I was earning the same amount at 23, always longed for more money. Now I’m still in my 20s earning a lot more.
I put it down to ambition and loyalty to a good company (pay rises, commission etc).
If an imminent pay rise is unlikely, you’re still in a strong position, although your debt is your weak link. Keep over paying the debt to get rid of it ASAP and suddenly you have so much more left over each month once it’s gone.
Once this is done, begin to stack the cash and start to pay off things annually, such as your TV license and car insurance, this frees up your monthly available funds for a whole year.
Last note is that I see your mortgage payment seems in the higher bracket for a 23yo, have you gone for the biggest mortgage possible? It seems all FA’s and brokers nowadays try to put young buyers on the biggest possible mortgages based on their affordability.
With brexit on the horizon and interest rates only going up, you may want to review this mortgage, and possibly downsize. It seems extreme, but I anticipate some big increases in mortgage rates in the next few years. Leaving those with big mortgages in a scary position.
Equity equity equity!
Edited by roadsmash on Monday 24th September 08:01
We could have borrowed another 40k roughly, but wouldn't have bought us anything better than what we have now.
However again to reiterate the others, you should be proud of yourself.
S9JTO said:
Shnozz said:
Conversely, what I spent on having my own place from 20> was the best value per experience I can recall in my lifetime. It certainly was not money wasted.
But did you have a near new 3L straight six turbo on the drive? 
Shnozz said:
Sadly the expensive car was the trade off and had to be sold for the deposit. It was replaced a year down the line with an old TVR mind.
That's something I've strived to avoid, you might call me shallow but I don't ever want to downgrade my cars. The LISA helps with the seperation of funds. Good to know you got back into something interesting soon after though!
S9JTO said:
That's something I've strived to avoid, you might call me shallow but I don't ever want to downgrade my cars. The LISA helps with the seperation of funds.
Good to know you got back into something interesting soon after though!
Interestingly, I bought my R34 just under three years ago with the intention of selling it to release funds for my house deposit, when I brought up the plan to sell it around 6 months ago it was met with Fire and Fury from the Mrs. Turns out she's sentimental as that's the car I took her out on our first date on, went on Euro trips and UK road trips in, etc etc. Who knew..Good to know you got back into something interesting soon after though!
Great on the one hand as I keep my toy, but jeez that cash would be handy!
Jossman said:
Interestingly, I bought my R34 just under three years ago with the intention of selling it to release funds for my house deposit, when I brought up the plan to sell it around 6 months ago it was met with Fire and Fury from the Mrs. Turns out she's sentimental as that's the car I took her out on our first date on, went on Euro trips and UK road trips in, etc etc. Who knew..
Great on the one hand as I keep my toy, but jeez that cash would be handy!
Hopefully it’ll be a keeper then! Even better if it’s an R34 GTR as they’ve appreciated at an astronomical rate and I can only envisage they’ll continue to do so Great on the one hand as I keep my toy, but jeez that cash would be handy!
My girlfriend has said she’s happy with me keeping/upgrading my cars before/after an inevitable house purchase in the next couple of years so I’m happy with that haha!
S9JTO said:
Hopefully it’ll be a keeper then! Even better if it’s an R34 GTR as they’ve appreciated at an astronomical rate and I can only envisage they’ll continue to do so
My girlfriend has said she’s happy with me keeping/upgrading my cars before/after an inevitable house purchase in the next couple of years so I’m happy with that haha!
It's not a GTR unfortunately - I'm no high roller and I use it for drifting so wanted a RWD - it's still appreciated to 3x what I paid for it in Japan though so I'm almost riding a similar wave! My girlfriend has said she’s happy with me keeping/upgrading my cars before/after an inevitable house purchase in the next couple of years so I’m happy with that haha!
Does make it easier to keep though because of the 'it'll be worth more next year' mentality!
Jossman said:
It's not a GTR unfortunately - I'm no high roller and I use it for drifting so wanted a RWD - it's still appreciated to 3x what I paid for it in Japan though so I'm almost riding a similar wave!
Does make it easier to keep though because of the 'it'll be worth more next year' mentality!
Regardless, it’s a nice car to own, congrats on that! Does make it easier to keep though because of the 'it'll be worth more next year' mentality!
For sure, I think my next purchase in a year or two will be a car that’ll appreciate, thinking Lotus Exige or similar...
amare32 said:
Without going into details, after all my monthly expenses I have £2,500 left per month.
Glad I went through my mid 30s sorting my finances out. Now 40 with retirement before 50 a realistic prospect.
Having no wife and kids draining my bank account helps.
Glad I went through my mid 30s sorting my finances out. Now 40 with retirement before 50 a realistic prospect.
Having no wife and kids draining my bank account helps.
- not sure how to do the violently agreeing smilie.............good work on the earlier retirement...................I reckon I'm going to be going until I'm 65 and I only need about 50% of my after tax. Not sure how that works - I guess I just waste it all on coke and hookers (petrol and cars)
BerlinChris said:
23 years old also, heres my situation.
Net income is £1400 - im also paying £50 a month into the work pension
£100 board (living at home, saving for a deposit)
£285 car payment ( handing the car back in 5 months thank F*** )
£55 insurance
£5 Spotify
£50 pm fuel
£60 weed - its a hobby of mine and good for my soul
£150 (will limit this to £75 from now on) booze/nightsout (this is something im drastically reducing, basically just telling my p!sshead friends to bugger off every friday and saturday night)
£25 phone contract
£100 food (My parents make most my food, the £100 is more to supplement my gym gains)
£20 pm 5 a side footy
£200 pm goes into my help to buy ISA
Ive cancelled my gym membership after spending £34 a month for 4 years. I decided on on buying all the equipment for a home gym. should hopefully see me save money in years to come)
my 2019 plans are to get rid of the car and cycle to work (I splashed out £1.5k on a road bike) as its only 4 miles away.
I find i have a couple hundred left each month, its a little daunting thinking about moving out (I think I best get myself a girlfriend to share the costs!)
The past few years ive went overboard on holidays with mates, 3-4 holidays a year spending around 3k a year, I plan on stopping these or limiting myself to 1 holiday a year
wouldn't it be better to see you mates and have a few beers than smoke weed? Ive seen the results of people who bin off nights out and smoke weed instead. Net income is £1400 - im also paying £50 a month into the work pension
£100 board (living at home, saving for a deposit)
£285 car payment ( handing the car back in 5 months thank F*** )
£55 insurance
£5 Spotify
£50 pm fuel
£60 weed - its a hobby of mine and good for my soul
£150 (will limit this to £75 from now on) booze/nightsout (this is something im drastically reducing, basically just telling my p!sshead friends to bugger off every friday and saturday night)
£25 phone contract
£100 food (My parents make most my food, the £100 is more to supplement my gym gains)
£20 pm 5 a side footy
£200 pm goes into my help to buy ISA
Ive cancelled my gym membership after spending £34 a month for 4 years. I decided on on buying all the equipment for a home gym. should hopefully see me save money in years to come)
my 2019 plans are to get rid of the car and cycle to work (I splashed out £1.5k on a road bike) as its only 4 miles away.
I find i have a couple hundred left each month, its a little daunting thinking about moving out (I think I best get myself a girlfriend to share the costs!)
The past few years ive went overboard on holidays with mates, 3-4 holidays a year spending around 3k a year, I plan on stopping these or limiting myself to 1 holiday a year
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