We’re Retired, Live in England, and Bring in £45K/Year

Welcome to YNAB Money Snapshots—where you see a real picture of someone else’s budget and finances. They’re all anonymous, because sharing money is still a squirrelly topic for many, but we think airing them out in the open makes you better with your own money story. 

As you read these budgets, keep in mind that some people make lots of money and some people make a little bit of money, but we know it’s what you do with that money and how you feel about that money that means more than any yearly salary. 

See how a retired couple in England bringing in £45,000 a year spent their money in April.

All currencies listed in Pound Sterling (1 Pound Sterling = roughly $1.25 USD at time of publication).

About

• Names: Ernest & Pescardo
• Ages: 66 & 67
• Location: West Midlands, England
• Job: Retired
• Living situation: Married with two grown children (both left home). More sometimes less self supporting. 

Income: £45,000

• £20,000 Gross income from buy-to-let flats
• £25,000 Pension income

Savings: £3,000

Debt: £208,500

• Buy-to-let interest-only mortgage*: £208,500

*For those unfamiliar with a buy-to-let mortgage, these are often purchased specifically to use as a rental and the borrower pays only the interest on the loan. The full amount of the mortgage is paid at the end of an agreed-upon term.

April Inflows: £3,200

Pensions: £2,150

Transfer from buy-to-let account: £1,050

April Spending

Budget

Catego­ry	What I Spent	Notes
Credit Card Payments
Amex	£25
Halifax	£0
Tesco	£0
Pescardo
Shopping/Out of Pocket Spending	£659
Gym 1st	£0
Home
Council Tax	£190
Gas & Electric	£117
Life Insurance	£83
Water	£252
Home Maintenance	£63
Logs & coal	£0
House Insurance	£0	Have £140 saved
Nationwide A/C Fees	£13
Cars
Fuel & Parking	£14
Tax Ins Tyres & Maintenance	£83
Giving
Tithe	£510
Every Child	£25
Action Aid	£19
Coms
Giff Gaff	£62	Mobile phone bill
Phone & Internet	£25
TV Licence	£0
Spotify	£9
Amazon	£0	Have £72 saved
Itunes	£0
Cash Lumps
Contingency Stuff I forgot (300)	£70
Tax (500)	£0	Have £1396 saved
Pay off Buy to Let	£0	Have £346 saved
James & Roy
James	£315
Roy	£50
Hidden Categories
Mortgage	£0
Total Expenses £2,584

My Savings Categories

I’m saving to pay our tax bill. 

I should begin to pay my buy-to-let mortgage off, It’s a big figure, but with an interest rate currently at 2.29%. My repayment is less than £400 a month interest only.

My concern is that I do remember interest rates in 1978—at 15% this would put the mortgage interest at around £2,600 a month—which would be £400.00 more than the rental income. This debt needs to either be dealt with or I need an escape plan. Or I hide from it, oh, that’s what I have been doing, I suppose. 

My Month

With Covid-19 we spent less than we normally would – not going out and not using the cars as much as usual, a pretty standard month otherwise.

My Story

I love to spend money and my wife does not, that I think makes us a good team, especially as I do the budgeting mostly. Well, I do the budget and then we agree together if it’s ok. After all sorts of property purchases and developments—both home and abroad, we are now in a reasonable position having consolidated our property situation down to two properties (our home and a rental unit). We are reasonably comfortably off at the moment and apart from the outstanding mortgage on the buy-to-let, all is good.

My Financial Goals

• To pay an additional £200.00 monthly off our buy to let mortgage and review the payments when the fixed period of the mortgage comes to an end in four years.
• To put £10,000 of the three annual pension payments due into an emergency savings fund every year so having a fund of £30,000 by September 2023.

I would rate my current financial situation as a solid: 4/5

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