Trying to buy a house and need to work out what my max monthly repayment should be. Never lived alone so think I might be missing a few things.

Would leaving £1000 after paying the mortgage be enough for everything else? I’m thinking:

Gas – £60
Elec – £35
Water – £20
Council tax – £100
Food – £160
Phone – £15
Home insurance – £50
Car insurance – £50
Internet + landline – £20
Petrol – £60
Other DD – £25

Leaving me with £425 a month for me.

£160/month on food? What are you eating? Cardboard?

£35 on leccy doesn’t go far these days. See if you can work out your consumption then do a comparison. Easy to spend £75-!00.

car tax
contents insurance
boiler cover
sky tv
Tv licence

I can give you the number of a free, really good mortgage advisor who’ll help you.

Going out …

Don’t forget to allow for inflation… Plenty of inflation…

Life Insurance
Road Tax
TV Licence
Boiler cover?

Your house insurance guestimate sounds a bit steep but that obviously depends on where you live. (Costs me half that for a three bed end terrace inc. £2k of additional ‘valuables’ cover away from the home and accidental damage).

Do you need any other insurance (ie life insurance under the terms of the mortgage?).

If it is an old house allow for repairs maintenance.

I can give you the number of a free, really good mortgage advisor who’ll help you.

How does he earn a living if he’s free ?

Think about interest rates rising.

spacemonkey – Member
Going out …

If you’re going to the baker a nice cake would be lovely.

Ta

B

£35 on leccy doesn’t go far these days. See if you can work out your consumption then do a comparison. Easy to spend £75-!00.

I’d say electric and gas figures sound reasonable for presumably a single occupant? A little high maybe but always best to overestimate in a budget. 75 pounds a month on electric if it’s not your only fuel sounds ludicrous to me.

The budget looks doable to me, although partly depends on your mortgage payment as well. Mortgage payment of 500 pcm then having 400 odd quid left seems reasonable, mortgage payment of 1500 pcm then it’s less than ideal.

Single occupancy outgoings on utilities don’t always end up being ‘comparatively’ less vs couple/family etc.

Sure, if you’re out a lot/don’t use much power then you’re going to pay less. But IME if you use a fair amount anyway then don’t be surprised if you’re spending more than you expect. Leccy prices have gone right up too remember.

How does he earn a living if he’s free ?

I think the reference is to time, now the banks have killed the housing market he has lots of free time to discuss the issue.

Car tax + MOT + servicing.

Bike bits.

Our combined gas and electric is 70 pounds a month (2 people, 3 bed semi). We’re not wasteful but not particularly thrifty either, if I am cold I put the heating on not another jumper 🙂

Gym membership

weeksy – my financial advisor is free. They make their money from the policies they set up for people

OP – home insurance sounds too much, mine is £30, and it includes my 2 ‘expensive’ mtbs as named items. Electricity, water and food may not be enough depending on the size of the house and the size of you…. Also I would total up what you expect to pay in annual car maintenance, tyres, servicing, MOT etc. divide it by 12 and include this in your monthly budget. TV license £12ish. Life insurance (if you croak it, mortgage gets paid and house goes to someone you love) £20-30 if you think you need it. You need to be as realistic as possible. In my experience its very easy to do a monthly budget, be optimistic and then get bitten on the ass.

But, a house is the best thing to spend your money on, I’d say you have enough. And if you are generally good with money you’ll manage

I get life insurance through work – I presume this covers the mortgage stuff?

£160 a month of food is reasonable – cooking from scratch. I used to spend £35 a week when I rented a few months ago.

OP – good on you, lots of people really don’t do this stuff! If you want it to be totally realistic then be ruthless about what you really spend on life. So as well as the odds that people have pointed out (TV licence, life insurances, car tax, maintenance etc) – also try and work out what you spend on stuff like: books, mags, subs, memberships, going out, holidays, gym, hair cuts, clothes, er bike bits etc. Obviously this fluctuates through the year but having a reasonable monthly figure will tell you whether the ‘money for me’ really is realistic. Also you will have a better idea of what in all of that is actually ‘nice to have’ and not essential which in turn will inform your decisions about what you are prepared to borrow to buy a house.

Oh and I’m sure you don’t need me to tell you that any ‘max monthly repayment’ you go for should take into account reasonable interest rate rises (unless you are fixing of course), just cause it won’t just be about affording it now, but also in 5,8, 10 years time … Good luck.

Just remember that there is a difference between having life insurance and owning life insurance.

If you lost your job (and therefore your benefits) though illness for example you would more than likely be unable to take it out elsewhere.

Having said that, life insurance is more important if you have partner/children to leave behind, if it’s just you living alone it’s not such an issue.

Apart from that your figures look ok i reckon, just factor in how you’d cope if the interest rate is back up to 5%+ in the medium to long term. Current rates may look like the norm now but long term interest rates are much much higher and those days will be back at some stage although unlikely in the forseeable future.

Bike bits aren’t too bad these days, I’ve gone through that stage and now have most of the stuff I want. If I need a new rear mech then I just wont go out that weekend.

Would try to get a 5 year fixed for added security.

weeksy – Member
I can give you the number of a free, really good mortgage advisor who’ll help you.
How does he earn a living if he’s free ?

Its not a reference to time. His company gets paid commission by introduction to the mortgage provider / insurer, he gest some of that plus a salary.

He’s free to you.

@MRANGER – I have life assurance, and critical illness for work and the mortgage company were happy with that – you still need “death” cover though thats in line with the mortgage depreciation.

I have life assurance but no critical illness cover through work.

I spend approx £100p/w on just living – if you were to do that it leaves you little scope for saving, I’d not been keen on committing to that and not being able to save anything monthly to give myself a ‘buffer’ for car replacement/boiler replacement/redundancy you name it – many things can happen.

Is it worth considering letting a room for a while to increase your income?

As an example, I have (per month):

£500 of DD’s (includes everything on your list + TV licence)
~£400 groceries
£100 petrol

On top of a £600 mortgage.

That’s for 2 adults, plus a 5 & 1 year old.

As has been mentioned, bear in mind inflation & other increases (insurance is always going up, gas/electric is likely to go up)

Your £160 for food sounds very optimistic, but perhaps you can survive on £40 a week as a singleton.

Unless you live in a war zone you should be able to get buildings & contents insurance for a lot less than £50 per month.

Then there’s other annual costs – boiler service/cover, car tax, servicing/mot, AA/RAC membership (?), plus putting some money aside for emergencies (broken washing machine etc)

Then you’ll want some ‘going out’ spends.

Overall, £425 per month after all living expenses sounds reasonable.