Monday, 5 December 2011

Can You Afford NOT to Control Your Own Household Budget?

It's Not Rocket Science!

I hate the above term! For me, it is on a par with phrases such as "it ticks all the right boxes" and "it's a blank canvas", the types of things people say on TV and radio, in everyday conversation and in the workplace. I had a boss who used to use the rocket science phrase to the point of infuriation! (Apologies, Robert, you probably weren't even aware of this nasty habit, but we were working for the MoD at the time and, for all we know, it may well have been related to rocket science, but not when you were talking to me about data analysis.) But I digress.

This post is about some homebased experimentation, research and analysis into what's the most cost-effective and efficient way of living on a tight budget, especially while trying to heat a rural property in cold, wet, windy Scotland.


Today is Monday, first day of the working week for most. Yesterday, we had the first snow of the year and last night/early hours of this morning, we had a torrential hail storm driven by high winds. Winter has arrived!

Here in Frugaldom, we are continually faced with the conundrum of how best to heat the house (and water) within a very strict, very challenging budget. This budget is based on several years of research and analysis, based on various households and their differing financial situations. It has never been about rocket science, it has always been about simple arithmetic and home economics. The interesting part is that my calculation results were always curiously similar, regardless of the level of income to any participating household. Indeed, it would appear that the higher the income, the more chance there was of a higher ratio of debt. Fortunately, many people have started to 'wise up' to this and are now taking cotrol of their own finances.


Basically, it has to be possible, as there are no other options for some people. If you are interested in how I arrived at the figure, the following is from 2001 and was republished, every bit as relevant, in 2008:


Couple with 2 of a family, husband is a professional who works full time on a salary of £30,000 and wife is a full time mother/homemaker (not sure what the politically correct term for this category is any more!) Total income approx £452 per week including Child Benefit.

Mortgage & Buildings insurance - £740 per month = £170 per week
Council Tax/Water - £125 per month = £24 per week
2 cars, both on HP - £300 per month = £70 week
2 x road tax, insurance, servicing, petrol/diesel etc = £270 per month = £62 week
Credit cards - £100 per month = £23 week
Bank loan - £100 per month = £23 week

Total expenditure before actual living expenses - £372 per week

Remaining Balance - £80/week for everything else


Couple with 2 of a family, husband works full time, wife part time, joint salary of £18,000 plus Child Benefit, total income approx £300 per week

Mortgage & Buildings insurance - £303 per month = £70 week
Council Tax/Water - £100 per month = £23 week
Home Improvement loan - £266 per month = £61 week
Credit/HP - £100 per month = £23 week
Other debts - £100 per month = £23 week
Car - road tax, insurance, servicing, fuel etc - £100 per month = £23 week

Total expenditure before actual living expenses - £223

Remaining Balance - £77.00 for everything else

(There is a slight difference in today's figures in that the above would now qualify for Working Tax and Child Tax Credits, fuel prices and car costs have escalated and mortgage rates have fallen dramatically. Nothing much else has changed over the past 10 years, despite everything. Is it any wonder the country is going to the dogs?)

Having analysed many household budgets, it didn't really seem to matter what the annual income was, there always seemed to be a significant difference in the way that income was spent. As an example, a single professional person earning £52,000 a year may well have only £4,000 to actually live off after paying the upkeep of a rather spectacular house, complete with tennis court, swimming pool, fast car, regular entertaining, foreign holidays and paying for a gardener and housekeeper.

In 2011, a single young person working fulltime on national minimum wage with rent to pay, keeping in mind they are excluded from Working Tax Credit on accounts of age, may well have far less than £4,000 on which to live. (I'd suggest housesharing or getting a lodger!)


No matter what your income bracket, we could all be in the same boat. Fortunately, we have the freedom to choose how we stay afloat. No matter what you do or how you do it, you are always going to have to pay the cost of living. If you can reduce the cost of living and clear off ALL debts, then think of the fun you can have from thereon in.

Budget to within an inch of your life and see just how much it costs you to live. You can see by the above how I arrived at the £4,000 and hopefully this will make things a little clearer for our newest followers, rather than having to search through at least 5 years' worth of information.


Nothing much has changed over those years. Whether we like it or not, £4,000 is the sum total of disposable income that many households have available each year, whether they realise it or not, and this £4,000 needs to cover all the basic costs of running a household, including energy costs. This is where it gets very interesting!


This is the beginning of a series of posts analysing the true costs of running a household in the 21st Century. Fuel or energy costs are what divide many of our individial budgets, whether it's a simple case of heating, lighting and power or incorporating the cost of commuting. It all revolves around fuel and energy - every penny we spend may be affected by these prices and I hope to relay the results of several simple, home based, non-scientific experiments in an attempt to help solve their cost-associated problems.


NYK Media ~ Frugaldom


  1. Very true to all of it. I totally agree that the more you have the more you are tempted to spend. Fuel, council tax and food are our major spends despite trying to cut down - still haven't had our central heating on fully yet, relying on the wood burner.

  2. This post ties in with the one earlier, I wrote a long reply which then went into cyber space so lets gave another go.

    Last winter we were living in a stone cottage in a rural location which we loved.....out bills for heating the cottage was astronomical

    We had oil central heating cost over 12 months


    Fuel for the multifuel stove in the sitting room.

    Wood 2 1/2 loads £250

    Solid fuel 4 bags a month for approx 5 months

    £300 A total of £1600.

    Earier rhis year, after a lot of heart searching we moved into town, our apartment is all electric, 2 storage heaters, sitting room and kitchen, although the sitting room one is out of commision, we are using an oil filled radiator, convector heaters in the bedrooms, one in use just now for an hour in the morning and just as we go to bed. Oil filled radiator in the hall which is on low.

    Our first leccy bill in September was £103. 83

    I have just entered this weeks readings on Scottish Hydro and it tells me we have used £153-58 a total of £257.41 since we took over the apartment on March 1st. Quite a difference.

  3. Datacreata, can I be cheeky and ask what it costs in logs to keep your stove burning enough to heat your house and if you're in Scotland? I'm wondering if it is economically feasible to heat a house (including hot water) on wood only, seeing as the whole carbon neutral debate keeps springing up in conversations.

    We're always going to need electricity, but what costs would be involved in buying enough logs over an entire year, assuming there was adequate dry storage, to sufficiently heat a draughty old stone cottage in rural Scotland? Draughtproofing and insulation are top of the prioroties list but as with any solid stone cottage with attic bedrooms, potential for insulation is extremely limited owing to the nature of the building itself.

    Silversewer, many thanks for those most helpful figures. They relate very well with my own and probably reflect the fact that's it's virtually impossible to heat this type of property to what the Government claims to be 'normal' room temperatures without falling into fuel poverty.

    Has anyone heard any mention of them abolishing part of the winter fuel payments for pensioners? I was asked this recently and wasn't aware that there was any possibility of them doing such a thing, although I do find them totally unfair when it's a blanket payment regardless of whether you live in the warmest part of England or the coldest part of Scotland. Unfair, unfair, unfair!

  4. Intersting

    I believe that it is absolutely necessary to control your household budget .................because it really is the only one you CAN control. We are all affected by decisions made by others and watching over our personal budgets at least gives us a little control back............................even if that means being stingy with the heating and eating out of date food!

  5. The Winter Fuel Payment has been reduced this year; it was £250 last year but the OH received £200 this year, and talking to older friends, it seems that the over 80s got £300 this year compared to £400 last year.
    We haven't turned the central heating on yet this winter, although it won't be long before we have to have it on in the mornings for an hour whilst the girls get ready for school. We wrap up warm during the day and use hot bottles and rugs and then light the fire in the late afternoons, and everyone spends the evenings in the living room, round the woodburner - good for keeping the family together. Hot water bottles in the beds mean that the beds are warm, but no one hangs about in the bedrooms very long before they get into bed!

  6. I'm trying to work out costs of running the open fire as it heats 3 radiators and hot water. First winter here, so better having something with which to compare future possibilities, like the log burner with back boiler system.

    Plenty of slankets, blankets and fleeces here and it'll be so much better once the kitchen is completely weathertight and got a ceiling. Getting a little bit impatient for that now, to say the least.

    Shaz, I keep just as tight a grip on the business budget. I've done away with my 30 days credit to clients in favour of a '10 day settlement cash direct to account' policy and have long ago got shot of the overdraft facility, prefering to use a business credit card that gets paid in full every month. The small charges (simply for them being business accouts! :roll:) are so much less of a worry than waiting a month to be paid for anything. LOL

  7. Hi again. We live on the outskirts of a very rural village in Norfolk surrounded by farmland so can be v. cold and wet in winter. I don't know what it would cost to heat your house on just wood. It rather depends on whether you have to buy in or can cut it yourself. One of our neighbours last year bought himself some kind of Danish wood burner. It can be used as a stove i.e. has 2 hotplates but he is using it solely to heat his house and hot water (except in summer). He gets all his wood himself so no cost there.

    2 years ago we paid £110 for a ton of dry, seasoned logs. We have just finished it today and are getting ready to start our new ton (at £125). This comes from Essex so we are looking for one nearer to home and have found one at £75 per trailer load. Last year we had our heating on more than this year (refuse to start yet). We have had our log burner on every day, mid afternoon, since late October (it doesn't heat water unfortunately). Logs used (storage size wise) have been 4' high by 2' wide - sorry, can't be any clearer than that!

    We live mainly in the room with the wood burner in it (measuring 20' x 12') and this afternoon/evening use burns between 8 & 10 logs. Probably would need double that for all day and especially if using a larger burner to include hot water etc. Ours is a Charnwood 4, the smallest one you can buy and it makes our room too hot to have the door closed! In the morning though, although it is out (easy to start it) the front room is still between 18-20 c depending on the outside temperature. That is why we don't need to light it until mid/late afternoon.

    Hope this is of some use. xx

  8. We are so lucky here all our wood is free, if we chop it and move it around ourselves. We have the run of ours and our landlords farm to gather wood and luckily for us (but not for the trees) there were lots of very large old trees felled this year due to them being diseased, so we are able to get trailer loads at a time from the position they fell on the farm.

    The only real expense is the Aga having to be on constantly, and this costs us around £1400 in oil charges each year, this runs the Aga, which in turn heats the hot water and we also have oil fired central heating which I ration during the day preferring to wear woollies and keep active to stay warm. It's set to around 15-17 degrees during the day and I briefly turn the upstairs thermostat higher for an hour before we go to bed, then it all goes off on it's timer.

    The downside to our large 4 bed farmhouse is that it is in the middle of nowhere, with vast expanse of land on all sides and is single glazed, stand near a window and you can feel the cold leeching in, we have thick curtains which we draw each evening to try and minimise the heat loss slightly but we are fighting a losing battle.

    Luckily we are moving to a little 2 bed bungalow soon, with double glazing and a wood burner in the living room, which manages to heat all the rooms except the conservatory so we will AT LAST be able to save more money.

    Sorry for the ramble......I think I just went with the!

    Sue xx

  9. Ouch to the oil prices, Sue! Bet you can't wait to get into the snug cottage! This is just a 3-bedroom but the lack of insulation and single glazed windows are really letting us down on the warm front.

    Time and money SHOULD alleviate these severe problems as the renovation proceeds and then I'm sure we can make this place warm within the next year or two. It's definitely a case of working towards retaining whatever heat we can and making this our top priority. Still no getting away from the fact that free logs would be a fantastic help in the meantime, though. LOL

    Feel free to go with the flow and ramble. afterall, it's one of the few things we can all do for free. :)


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