Last Summer I was out with three friends, sitting in a posh cafe when we began discussing imminent changes to the benefit system and how it would effect our family lives. I was, in short, staggered at how three of my friends, who all have decent jobs and dual incomes, would be seriously struggling as a result of Working Families Tax Credit and Child Benefit stopping. We were sitting in a overpriced coffee shop, dressed up as ladies who lunch, and yet one of us was seriously suggesting her children will no longer be able to go on school trips as a result of the benefit changes.
It was time for a serious chat about money........this is what I learnt about my friends I have known for years
1) 4 of us had debt and considered it normal
2) 3 of us where deeply unhappy in our jobs but felt stuck because of debt repayments
3) 2 of us were having relationship problems as a result of money issues
4) 3 of us were not paying any extra towards mortgage repayments, or saving for future events
5) 2 of us were wanting to increase hours at work, for the extra money, rather than decrease hours
6) 2 of us expect to go abroad on holiday once a year as a reward for working hard
7) 2 of us had paid money to go on a organised shopping trip to Liverpool, regardless of money anxieties and debt
8) 3 of us pay for gym membership and or slimming/fitness clubs
9) 3 of us have aspirations to move into a bigger home
10) 3 of us were blaming George Osbourne for our financial woes
Now I'm not wanting to write a political blog and everyones circumstances are unique. I know there will be real hardships for many people in our country over the next few years and we should be supporting the most vulnerable in our society. But it was a real eye opener to witness a couple on a joint income of £60,000 in debt who are unable to prioritise their spending or take responsibility for future events that will surely happen.
I came away feeling deeply sad that we had valued stuff over family security and relationships. That we need to travel far and wide to have a worthy family break, and that we were already discontented with the heaps of stuff we had already accumulated, bored of their same-iness and in need of something new and exciting to make us feel great about ourselves once again. One of my friends declared "I'm not materialistic. All I want is a new kitchen. Then I will be happy!" Saddest of all is that we were prepared to work extra hours in a job we hate in order to feed the beast of debt, insecurity and neediness and an inability to be ok with what we already have and save for future wants.
So....as we paid our bill for our posh coffee and carrot cake I suggested "how about meeting in the park next time, I will bring a flask and cupcakes!". The stunned silence was deafening.
To make the tough times not so tough.....
Put money away into a 'do not touch on pain of death' fund.
Some saving accounts even allow you to give your accounts names. This is a good idea. It gives a reminder of what you started the fund for in the first place before you dip into it for something frivolous. It doesn't matter how much or little, it will slowly accumulate. Even £5 a week will add up to £260 a year and after 5 years that would be £1300 (plus interest). Consider giving something up or reducing a spend to allow you to squirrel even more away (smoking, a bottle of wine, walking to work, chocolate, Sky, fizzy drinks, take aways) Pick something and stick to it. Eventually you might want 3 months salary resting in an account for emergency situations, but for now think small and gradually build it up.
Kick start your fund by selling old unwanted stuff on ebay, amazon, car boot sales
There is nothing more sobering than doing a car boot sale and having all your past
Put extra non perishable food in your trolley each week
As we know food banks are popping up all over the country. It is incredibly depressing. I have seen many times on money forums of families who have a pitiful amount of money for food to last until payday. Do not get into this situation. You do not need to go mad and start throwing food into your trolley willy nilly. A few extra tins of beans, or a packet of rice (when they are cheap) each shop will soon add up to an impressive World War III cupboard. Having a well stocked cupboard will buy you time until payday or benefits arrive. Don't rush, keep it in budget, and write 'use by dates' in big black permanent marker to avoid waste.
How about you? Do you have a plan of action for future setbacks? Do you have a 'when zombies attack' food cupboard or set money aside each month for emergencies? Would you be ok if your income dropped unexpectedly?
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