Paula Goddard is looking forward to getting back to work, and concerned about not having enough money for retirement
In our How I Manage My Money series we aim to find out how people in the UK are spending, saving and investing thier cash to meet their costs and achieve their goals.
This week we speak to Paula Goddard, 47, who lives in Colchester with her husband, Steve, 47, and their two children, Chloe, 19, and Joseph, 14. Paula is surviving on benefits and looking forward to getting back to work this year after taking a career break to care for her elderly father.
Monthly budget
Our monthly income: We receive £2,205.44 in universal credit, including carer’s and disability elements, each month. We receive £104.20 in child benefit each month for our son. My son receives £558.20 in disability living allowance each month. I receive a £412.40 personal independence payment each month too. My son is autistic and suffers from a neurological condition and partial sight loss as a result of optic disc drusen.
My husband has an income from his job working in a local charity donation centre. His monthly income is £1,145.44 and he works part-time three days a week.
Having more than £4,000 coming in a month sounds a lot, but it does not go far when you factor in how much everything costs.
Our monthly outgoings: Council property rent, £551.09; groceries, £700; toiletries, £25; council tax, £126; gas and electric, £135; water, £55; TV licence, £15.71; home insurance – contents only, £29.46; Sky TV, £95.76; landline and broadband, £20 on a social tariff; rent for fridge-freezer, washing machine and cooker, £132.29; money into savings via various Monzo pots, £479.24; car on finance, £393.77; car tax, £16; car insurance, £55; car fuel, £120; buses for the children, £80; pet insurance, £47.13; dog vet plan, £18.99; four mobile phones, £165; Spotify, £19.99; Audible, £8.99; window cleaner, £12; annual Imperial War Museum membership as my son loves planes, £10.50; eating-out treat once a month, £50; donation to church, £200.
I am not adding money to any pension, but my husband has a workplace pension. We use a community gym which is free as we receive universal credit.
My parents divorced when I was three. My dad moved from job to job and my mum didn’t work or have a lot of money. We were in temporary accommodation for a while before moving to a council house.
My mum tried to make the best of the situation but she had three kids to bring up and started relying on credit cards. I didn’t get a good financial education growing up and decided not to go to university. I wanted to be a pharmacist but that did not work out. Instead, I got a job as a dental nurse, before working in retail and car insurance.
New FeatureIn ShortQuick Stories. Same trusted journalism.
Years ago, I married my first husband but got divorced and had £20,000 worth of debt to pay off. I was in a financial mess. I then met Steve and we got married. Soon afterwards, I was on maternity leave and made redundant from my job. Steve and I hit serious financial trouble. During these rough times, money became my worst enemy. It would keep me awake at night and I was always worrying about how to pay the bills.
I used to have a very unhealthy relationship with money. It would burn a hole in my pocket. I’d impulse-buy and was hot with credit cards. I’d do family photo sessions and then wonder how I’d pay the monthly payment. I wasn’t careful about spending money and our budget was unmanageable.
Steve and I started missing rent payments and were threatened with eviction. My son was born prematurely at this point and we were both made redundant from our jobs again. Friends had to give us food parcels and we had to find somewhere else to live. We had to decide whether we all ate or we put the heating on. I would never want to put my children through all that again.
In 2013, I contacted Christians Against Poverty (CAP). They helped me learn how to sort out my debts, create budget spreadsheets and stick to them. I went through a debt relief order [which allows people to freeze their debts for 12 months].
We became debt-free on Christmas Eve in 2013, which felt fantastic. Later on, I became a debt coach at CAP, helping other people with their financial problems. I was in this job for eight years before taking a year-long career break to look after my elderly father who sadly died in August last year.
The cost of living in Britain just does not match what most people are taking home each month. There is a huge gap between what people earn and what people can spend on shopping. The fact that we spend £700 on groceries and school meals a month is insane. A few years ago, that figure would have sounded mad. The Government needs to sort this out. We need a country that people can afford to live in.
We have Sky TV as we don’t go out. That’s our entertainment. Taking the kids to bowling or the cinema is only for special occasions now. My son loves drama, but the idea of going to the theatre in London isn’t really feasible.
Each month, I add £479.24 to various Monzo pots. These funds can be used for things like car costs and trips to the dentist. I don’t have any stocks or shares or Isas, though I would like to learn more about them. My main focus is managing each month. As I’m on universal credit, I have to be careful not to save too much, otherwise my universal credit would be reduced.
We moved to our three-bedroom council house in February 2018, paying £551.09 in rent a month. It took two years to get from a two-bedroom to a three-bedroom council house. I had to sell my house I owned back in 2002 as the former marriage I was in broke down and I couldn’t take on the mortgage alone.
Pension saving has been put completely on the back burner for me over the years. I have a few old small work pensions, but I am not 100 per cent sure how much is in them. Ideally, I would like to retire at the age of 65, but in reality, this may not happen. My mum is 72 and still working. Realistically, I will probably be working until I am 75. The possibility of not having enough money in later life does concern me.
Money is a necessity to pay for the essentials and I’m not motivated by it. Even though I budget carefully, I still have nights where I worry about money and unexpected costs like school trips for my son. I’m in a much better place to afford these things now, but I still get worried sometimes.
In an ideal world, I would like to be in a job earning at least £40,000 a year and come off universal credit. I don’t want to be reliant on the benefits system. Being on benefits carries a lot of stigma, as does living in a council house. I’ve had people tell me it’s taxpayer money and not mine.
I do feel embarrassed that I rely on the benefits system. I hope to start working again from March this year. Whatever happens, I will forever be making spreadsheets and budgeting each month.
Want to take part in How I Manage My Money? Email money@theipaper.com