Autism and Finances.

How Does Autism affect my budgeting?

I don’t think I have shared this on my blog before, but I have a teenage son that I care for and he has Autism.

 I know I’m not the only person in this situation, so thought I would share some of the positives and negatives that come with caring for someone with Autism brings, especially in terms of budgeting.

In my experience, feeding and caring for someone who has Autism can be a real challenge, and I have added extra money to my budget to allow for his like, dislikes, preferences and food aversions.

The difficulties with ASD and budgeting

Autism means that he cannot always eat whatever we are eating, or that I cannot just keep the heating off to save money. Sensory issues mean he gets cold easily, loves a certain food one day and then hates it the next.

Batch cooking is all very well and good, but not for a person who has a fear of germs, hates the texture of pre-frozen foods, or swears they can taste the metal/plastic of the containers that you’ve stored food in.

My food bills can be considerably more expensive than that of a normal family of three. There are certain brands that my son cannot eat (and yes, I say cannot, instead of will not, as these things are not a choice for him). He cannot eat value basic brands of food, except for peanuts (go figure).

He only eats 2 brands of cereals, Kellogg’s and Tesco. I can’t shop at Aldi or Lidl often, as he won’t try new brands of foods and definitely won’t eat a brand that he doesn’t recognise.

The positives with ASD and budgeting

There are positives though.

The main one being that he is incredibly logical in his thinking, and as long as I already have the food/brands that he likes in the cupboards, he will go days eating the same things (Kellogg’s cereal for breakfast, Spanish omelettes for lunch and fish, chips and peas for dinner) and not expect me to go food shopping for anything else.

He generally likes easy to cook, cheaper foods. Like pasta, potatoes, tomato sauces, spaghetti bolognaise etc.

When I tell him I don’t have any money left in the budget to buy any extra food/treats, he accepts it straight away and never complains.

He 100% supports my financial goals, as he sees that value in money, being debt free and having savings in the bank.

So, while there are certainly challenges, there are also real positives. Of course, some of these positives are because of his age (19) and placement on the Autistic Spectrum. He is verbal, his cognitive function is good and he understands the reasoning behind most things. While meltdowns are frequent in regards to getting him to try new foods (often cheaper brands that he isn’t familiar with), occasionally we have a breakthrough. It normally involves him seeing the unfamiliar item roughly 20 times before considering trying it.

So, I have noticeably higher food bills and heating bills than average, I would say. But that is all part and parcel of caring for someone in my family with Autism, and I wouldn’t change it for the world.

Of course, you may care for someone with Autism and have none of these challenges, or may have a whole heap more than these. Why not pop me a message below and let me know what struggles you face with budgeting and Autism? Or even better, share your positives!

Why not go over and visit Our Collective Life, who blogs about
Dissociative Identity Disorder. She has a great post about how this illness effects her finances https://ourcollectivelife.wordpress.com/2019/01/26/its-expensive-being-ill/?fbclid=IwAR0fP7VSV2by3qntK40tR0Q8gLlQP-PNChjHve_E5k8J8mtEhiJzBMsMU3c

Baby Step 3B

Hi and welcome back to my series about Dave Ramsey. The previous posts in the series can be found here:

BS0 http://themoneyfreak.co.uk/2018/11/14/dave-ramsey-uk-baby-step-0/

BS1 http://themoneyfreak.co.uk/2018/11/21/baby-step-1/

BS2 http://themoneyfreak.co.uk/2018/11/29/bs2/

BS3 http://themoneyfreak.co.uk/2019/01/20/baby-step-3/

Today I am continuing this series with Baby Step 3b.

What is Baby Step 3B?

Baby Step 3B is the ‘Mini Baby Step’ that comes between Baby Step 3 (The Fully Funded Emergency Fund) and Baby Step 4 (contributing 15% of your income to retirement), and is saving to buy a house.

The reason that it is after baby step, is that you NEED to have your Fully Funded Emergency Fund before you make what will possibly be the biggest purchase of your life. Similarly, the reason it comes before BS4 is because saving for a house is a short-term goal, but you will be in BS4 for a longer time. You can afford putting off contributing to retirement for a few years, in order to save for your house deposit.

Guidelines for BS3B

Dave Ramsey suggests a minimum of a 20% deposit, although here in the UK there are Help to Buy schemes (starting at a 5% deposit), Shared Ownership, and various other government schemes that can help you get onto the property ladder.

The problem with these 5% deposit schemes, is that a lower deposit means higher mortgage payments. It is better to save for longer and have a higher deposit to p0ut down, so that your long-term mortgage payments are lower.

Another suggestion by Dave Ramsey is that you apply for a 15-year fixed mortgage. While this makes sense, its not always easy (or possible!) for the average Joe. I highly suggest using the Mortgage calculator and also looking at current Mortgage Offers on Money Saving Expert. https://www.moneysavingexpert.com/mortgages/

The final piece of guidance from Dave in regards to BS3b, is that your mortgage payments should be no more than 25% of your household take home pay. This makes absolute sense, as you don’t want to struggle paying your mortgage every month.

I hope this has been helpful if you are looking to save for a house deposit while on the Baby Steps. However, these suggestions are pretty solid even if you don’t use the Dave Ramsey Baby Steps.

I’ll be back in a few days with a post on Baby Step 4

C.

Baby Step 3

Hi and welcome back to my series on the Dave Ramsey Baby Steps.

You can find the other posts in the series here:

Baby Step 0 http://themoneyfreak.co.uk/2018/11/14/dave-ramsey-uk-baby-step-0/

Baby Step 1 http://themoneyfreak.co.uk/2018/11/21/baby-step-1/

Baby Step 2 http://themoneyfreak.co.uk/2018/11/29/bs2/

I’ll reiterate that you NEED to have written a budget before you start the Baby Steps (see how to do that here http://themoneyfreak.co.uk/2018/06/24/how-to-write-a-budget/) and you NEED to follow the Baby Steps in order.

Today I’m writing about Baby Step 3. Now, in my own opinion, this is the most difficult Baby Step. I feel like when we are in BS0, we have just started and are really motivated, and in BS2 we are on a mission to pay off all of our debt and will see an end result (more money for us instead of going to creditors). But BS3 kind of leaves me feeling a little flat. Having cash in the bank for no reason other than ‘just in case’ isn’t something I’m familiar with.

Plus, I would also say that this is the first of the Baby Steps (BS) to differ slightly from the American system.

What is Baby Step 3?

Baby Step 3 is a CONTINUATION of BS1. So, in BS1 we saved a £1k emergency fund and in BS3 we add to that until we have 3-6 months’ worth of expenses. That’s why BS1 is called the Emergency Fund, and BS3 is called the Fully Funded Emergency Fund (FFEF), because it’s a continuation of, not as well as.

To calculate how much you’ll need for BS3 you look at your budget and see what you would need to live on per month if you had no income at all.

This is where things differ in the UK, as most of us would be fortunate enough to receive some Government Assistance in the form of Benefits. Assistance such as Universal Credits, Tax Credits, Child Benefit, Council Tax Support etc.

Whether you take that into account when working out what your 3-6 months of expenses will be, or not, that is entirely up to you.

Also, when doing your calculation, remember that this is an EMERGENCY budget, in case of a job loss, or death, or any other emergency. We don’t include Sinking Funds, any eating out, any pocket money, gym memberships or luxuries. Its just what we would need each month to keep a roof over our heads and the bills all paid.

Why do we need BS3?

Although I am finding BS3 incredibly boring, I do see the value in it. In fact, this is probably (in my opinion) the most important Baby Step, as it’s the one that will stop us from getting into debt once we become Debt Free.

It is our buffer from big emergencies like job losses and can be the difference between putting food on our table or not. It isn’t for dipping into at Christmas time, or if our car breaks down, we cover that with Sinking Funds (here is info on Sinking Funds if you would like to read it http://themoneyfreak.co.uk/2018/08/12/sinking-funds-how-to-save-for-large-expenses/). This Baby Step is for EMERGENCIES ONLY.

Without this Baby Step, when we have an emergency, we will end up getting back into debt. That is why this Baby Step is so crucial.

I hope that explains a little about Baby Step 3, and I’ll be back in a few days with the next in my Baby Step series, Baby Step 3B.

C.

Dave Ramsey UK-Baby Step 2

Hi and welcome back to my series on the Dave Ramsey Baby Steps.

You can find the other posts in the series here:

Part 1 (Baby Step 0)

Part 2 (Baby Step 1)

I’ll reiterate that you NEED to have written a budget before you start the Baby Steps, and you NEED to follow the Baby Steps in order. If you need help with how to write a budget, I have a post on that too, here.

Today we are moving onto Baby Step (BS) 2. This is probably the most exciting of the Baby Steps, paying off all of your debt except your mortgage.

So, you start BS2 by writing down all of your debts in order from smallest to largest. For some people, me included, this is the hardest part of the whole journey, seeing how much you actually owe. I found it very eye-opening, and made me want to run in the opposite direction.

But once we get through that part, and face it, you have the motivation to start paying it off. If you’d like to read about how to keep motivated during your Debt Free Journey, I have a post about that HERE.

To pay off the debt, you’ll be using The Debt Snowball Method. This is where you pay off your debts by balance, 1 by 1, starting with the smallest debt and finishing with the largest debt. You do not take interest rates into account unless you have 2 debts with the same balance, in which case you pay the higher interest rate one first.

Once you have your list of debts, you look at your budget and pay minimums on all of your debts except the smallest one. Attack the first balance on your list by paying as much as you can towards it every month while still making minimum payments on your other debts. When you’ve paid that first debt off, use the money that you were paying on your first debt, and put it towards your next debt and start attacking that one. You continue that pattern until you have paid off all of your debt and are Debt Free! That is BS2 finished!

But after writing your budget, what happens if you don’t have any money left over to put towards debt? Well, the issue is either that your income is too low, or your expenditure is too high. Or it may be both! You need to go through your budget and make adjustments and cut anything you can from it. If you have already done that, you need to make more changes.
In this case you either need to try working more hours (if you work outside the home already) or if you are a stay at home Mum, then you’ll need to find work outside the home that fits around your husbands working pattern. 
If you are a Single Mum like I am, you’ll need to work outside the home if you don’t already, or work more hours. I understand this isn’t always possible, but these are just guidelines.
 If you need childcare and are worried about the cost, please look at https://www.entitledto.co.uk/ to work out how much better off you will be in work. Despite many misconceptions, I have NEVER been worse off working than when I was on benefits. 

 

I’ll be back at the end of the week to talk about Baby Step 3

Claire.

 

Baby Step 1

Hi, and welcome to the 2nd installment of my Dave Ramsey Baby Steps series for the UK.

You can find the first in the series (Baby Step 0) HERE, and today I’ll be explaining Baby Step 1.

Before we start Baby Step 1, I personally think it’s very important to have written a budget. If you need help on how to do that, I’ve written a post about that HERE.

 

What is Baby Step 1?

Baby Step 1 is the starting point to our financial plan. It is to save £1000 CASH in the bank. Or if your household income is less than £20k a year, that amount is reduced to £500.

This is our Baby EF (Emergency Fund). Now, don’t panic. Later on in the Baby Steps, we will come back to this ‘Baby EF’ and add more money to it, but right now, we just need to focus on saving that £1000/£500.

The aim is to save this money as quickly as possible, so that we can move onto the next step. So, we can sell any unwanted or unnecessary items that we have in our home (clothes, furniture, shoes, music equipment, ANYTHING goes) or cut out anything we can from the budget (this is why I feel it’s crucial to have written a budget before you start this step). Be lethal. As Dave Ramsey himself says, “sell so much stuff that the kids think they’re next!”.

Why have an Emergency Fund?

According to The Money Charity, around 9.45m (35%) of UK households have no savings whatsoever. That is a scary thought, that 35% of households in the UK don’t have any savings for emergencies.

As you can probably tell from its name, the EF is ONLY for emergencies. Things that we cannot see coming and unexpected life events. It is not for things like Christmas, Birthdays, Days out etc.

The fact is, that unless we have an emergency fund to cover emergencies, we WILL end up getting into more debt than we currently have. Life happens, and we need to be prepared for it.

Imagine that you lost your job, or that your car was in an accident, or you had an urgent plumbing problem in your house. Without that EF, how are you going to pay for the expenses that will occur? Well, if we don’t have the cash to pay for it, we’ll end up using credit cards, loans or other forms of debt. When we have an EF, we have that small safety net.

Many people find Baby Steps frustrating and pointless. Once they have decided that they want to pay off debt, they want to get straight into that Baby Step. But for the reasons I outlined above, Baby Step 1 is absolutely crucial.

I hope that has explained what an emergency fund is, and why you need one. I’ll be back later in the week with a post about Baby Step 2.

Claire.