Archive for spending

Back from paradise

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So we survived our houseboat adventure … in fact, I think we flourished as a family! We actually enjoyed each other’s company (most of the time!) and worked together to keep everything running well.  Of course, there is a fair bit to do each time you put down and raise the anchor, so hubby and I had to listen to each other, plus watch our little one. But it was definitely worth it.  Above is a photo of our 3-year-old drinking in the view. I think he had a great time too.

While it’s always lovely to be back, we had a blast on our trip. Cruising around the islands, dining on freshly-caught crab, squid and fish, swimming at the odd well-protected inlet … it was like paradise.

I must admit though that I have `sea legs’ (or is that `land legs’) – I’m still detecting a bit of wave action whenever I stand too still!

I definitely think it’s good we went and did this but my focus has immediately returned to boosting our finances wherever I can.

Two jobs for today:

1) Rework our billpaying account to ensure that enough cash is being held each week to meet our regular bills; also I will investigate whether any of these (pay TV/internet) can be reduced.

2) List my financial goals for 2009 on the sidebar so I can scratch them off once achieved.

We’re aiming to build up a 20% deposit, which will take at least two years (from January ’09) so there’s a lot of work to do and I’d like to cut that period down as much as possible.

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Holiday expenses

house-boat

Well, our houseboating trip is on this week and I am excitedly preparing. The vessel we are going on is very similar to the one pictured above, and I can’t wait. But there have been a few expenses in the lead-up:

– 3 beach towels – $40 (sick of trying to wrap our tiny bathroom towels around my waist when in public!)

– Wine/champagne/spirits – $134.50 (we are entertaining some friends for two of the nights onboard)

– Food – about $200 – not so bad when you consider this is essentially our `weekly shop’. It covers each of our meals for 5-6 days, and we would normally spend about this much anyway for a week.

– Stinger suit for our toddler son – $45. Marine stingers (especially irukandji) can be fatal, so an all-in-one suit will keep him safe. This way we can swim in safety (apart from sharks, crocodiles and other nasties that we will obviously need to keep an eye out for).

– Petrol: this is going to cost at least $100 for driving to the town where they let the houseboats, and also to fuel our own boat (which is going to be the runabout). Having our own boat will allow us to fish and crab down the smaller creek systems. Hopefully we will dine well on seafood at least one night this week!

While I concede that all this is expensive (especially on top of the houseboat hire fee of $2300), it is also true that once we are on the houseboat, there are no ongoing outlays like there might be at a resort (you know, drinks, meals, tours), so I think it’s comparable to other holidays. It just seems worse right now because all the expense is upfront! And this is one of my husband’s top 5 all-time dream holidays. It’s a bit of a joint reward for me getting through 8 years of college (at times, it was as hard for him as it was for me).

It’s also true that the upcoming (Australian) stimulus package will pay for the vast majority of our houseboat hire fee. We expect to receive $1900 as two working people, while the total hire fee is $2300. So our holiday is looking like costing us under $800 once all costs are taken into account, and excluding the $200 food bill, since that is part of our regular budget.

Would it have been more responsible to put the stimulus money into savings? Probably. But we elected not to, and I guess at least this way it is being used in the way the money was intended.

We head off in a few days and I’ll check back in when we return!

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Resisting the urge to splurge

AAARGGH! This is why I’ve learnt to avoid the stores!

I have had a new drive to decorate (ie buy things for, not actually improve) the house, and so 9am rolled around this morning and I was standing there waiting for the homewares store to open. It was so sad, me sitting there looking desperate to part with my money. I actually felt embarassed for myself.

Luckily, when I got inside I decided that the items I’d been lusting after weren’t as great as I’d remembered.

This is one of the benefits I’ve gained from being more careful with my money. I have to still really want something the third time I see it in the shop before I’ll buy it. Near enough is no longer good enough. It means the bar has been raised in terms of actually parting with cash. And it’s surprising how often I realise I’d thought something was way nicer the first time I saw it. 

I had been quite taken with the idea of a glass lantern to hang on our small side patio (outside a window), but once I got back into the shop, I didn’t like the item in question as much. So, no loss!

I am also trying to remember that all these `little things’ add up to a lot and could slow down our dream of owning our own home.

So I traipsed back home again empty-handed.

However, there are 24 more weekdays remaining on my holidays so I’ll need to show the same discipline for a few more weeks yet!

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So Sick of Debt: the `On Holiday’ edition

Well, I am now officially on leave!  I am going to sleep in this weekend and really enjoy it before getting busy to make the most of my time off.

We also added the latest $200 bucks to our efund and it is really starting to climb now – it’s up to $1400.

However, I am a bit worried about how to handle the early payment required for our houseboat trip. They want the balance of our trip 30 days in advance (ie now!), which would require hitting the efund or putting it on the credit card! That’s because although I have allocated where the money for our trip will come from, neither of these lump sums have actually hit our account yet.

Does this mean we’ll be back in debt, even if it is for a short time? I’m not really happy with either of the two options above, which is exactly why one of my goals for this year is to accumulate a $2000 slush fund for situations like this! Looks like I would have been better off accumulating this straight away.

This is exactly the reason I didn’t think it was fair for my new employer to make me take holidays so early, as I didn’t have time to save for my holidays specifically.  Apparently it is in our award that they can do this to us, but I don’t necessarily believe that it is true. It’s also been ruled on by employees (administration staff) who would never accept it if it was forced on them. However, being at the bottom of the medical heap means they can do stuff like this apparently.

Anyway, it’s happening now so I need to make the best of it. I thought I might do some work on our father-in-law’s house. I was thinking about learning to tile, as there are a few small rooms that I could start on and see how I go. My husband is very handy so he could step in if I go off track.  But maybe it’s harder than I have been led to believe. Any thoughts?

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Christmas spending

Happy Christmas everyone! I hope everyone is having a great holiday season (though I can’t quite get used to that very American saying `Happy holidays!).

I have had some lovely downtime with the family, though I have to admit my financial mind never stops ticking over, even at this time of year.

We had a very low-key Christmas and it was lovely. It was partly an enforced situation because we had been concerned about graduation right up until December 21. My family decided to swap no gifts, except that my son received a gift from all the usual quarters (he’s the only grandchild in the family). Although this gift embargo might seem mean-spirited, it’s really not, as our family commonly bands together at some point in the year to buy something for someone in the family when it comes up (ie if their favourite musician is coming to town and they’d like to go to the concert).  This way, we tend to give gifts the person actually wants.

As for hubby’s extended family, we do continue to buy gifts for the children. This is an enjoyable arrangement and not too costly in the scheme of things. Also, this is the final year we will probably do it for some of the `children’ as they just graduated university and are about to move out of home – at 24, 23 and 21 they don’t really qualify anymore!

Anyway, this is what we ended up spending this Christmas:

Hubby: $100 for a fishing reel he has wanted for 6 months. On the plus side, it was marked down from its usual price of $139.95.

Me: Not sure exactly but suspect hubby spent about $80 on two lovely good quality candles and six Royal Doulton wine glasses.

Our son: We spent $50 total on a 36-piece animal farmhouse, two books and some stocking fillers.

Nephew: $35 for a bottle of spirits (don’t worry, he is over 21!)

Father-in-law: $20 for `scratch-it’ lotto tickets.

Niece and nephew – family #1: $50 (total) debited to parents account to spend in post-Christmas sales. 

Niece and nephews – family #2: $60 for two ties (the boys are about to start work). Our niece received her Christmas present earlier this month as part of her birthday present.

Parents – family #2: $10 for a box of chocolates as they do a lot for us.

Food and alcohol: $100 – we bought all of the food and some of the wine for our champagne breakfast with the family on Christmas morning. We didn’t need to buy Christmas wrap or cards as we already had a stash.

Our total Christmas spend was $505 which represents just over half our usual Xmas budget. The funny thing is, it was by no means a less enjoyable Christmas for the reduced spending. This year, it was somewhat necessary to reduce the budget since I haven’t worked over this whole final semester of uni and we have had lots of added expenses over the last six months (my island elective plus graduation are just two that come to mind).

It is worth considering ways to keep our Christmas spending low in the future. I think I’ll keep the usual $1000 budget but if we can pull in the actual spending below that again in 2009, I would be very impressed.

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Graduation is ruining my budget!

Well, I may still be 12 weeks or so from graduation but the costs just keep coming!

Academic gown hire is going to cost $89! Lucky I’m not actually buying the gear … that would really break the bank. As well as that, I have to pay $420 to register with the medical board. I guess it is a bit like a union fee so I shouldn’t complain but `ouch’! Don’t they know we aren’t even earning yet?

As well as that, the graduation dinner tickets are $90 each, and the farewell party (the next night – more oriented to saying goodbye to other students, less for families) is $25 each for the two of us.

And what about a dress? For the ball and/or for the ceremony …. might have to decide whether that can be done.

You don’t graduate every day so I accept this but it is really adding up.

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Lessons from a classic

Yesterday I went back to a charity secondhand store where we recently found some cheap party costumes. While I was there last time, I happened across a travel guide I thought a friend could use on an upcoming holiday. I went back to buy it for her yesterday, but while I was there I perused the rest of the book shelves. I managed to pick up a classic Australian child-rearing text (Toddler Taming) which I knew I could use (toilet training is tough!), but I also came across another classic – a personal finance one.

The book? The Richest Man in Babylon by George S. Clason. I picked it up for $5, though someone had relatively recently paid $21.99 for it. I was intrigued to find that, about four pages in, the previous owner had flipped over the top of the page, as if to mark it to come back to later. It didn’t look (by the condition of the book) that this had ever occurred.

While I’m not sure if the previous owner got the chance to peruse this book properly, I read it in a couple of hours this morning. I found it was everything I’d heard about from others and more. Every little story really set out the realities of wealth creation, and I found it amazing to really consider how the same excuses we use today would have been the same as those used centuries ago. While they might have lusted after fine robes, we long for Guess handbags. They longed for a fine herd, we long for a fat mutual fund!

From the author notes, I found out that Clason’s stories were used in bank pamphlets for many years, and I can see why. Nobody EVER set out lessons as clearly as this for me when I was younger. Back then I NEVER really thought to put money aside for anything more specific than a house deposit. I never thought about building wealth or investing to create cash flow. That was before I embarked on my own efforts to beat debt, and obviously I’m more than familiar with those goals now. But this book is one that can be used at any age or financial stage. I’ll keep it forever, just to remind me every now and then that having a financial purpose beyond `getting through the week’ is the only way to move forward, whether it’s shekels or dollars you seek!

The book has also made me rethink the way I budget. Generally, I have always budgeted the outgoings first, then looked at how I can meet these goals using the amount coming in. This generally works in terms of helping me meet a goal. it can be good if that goal is helpful to my bottom line (ie to build a house deposit) but not entirely if my goal is just to afford a trip, because it means I tend to focus all my spare dollars on attaining that, instead of allotting some towards `getting ahead’. So if I had $1000 coming in, I usually just paid the regular expenses, kept an appropriate amount for food and petrol, and put the rest on debt, or saving for something fun, or miscellaneous spending.

While I have heard the words `pay yourself first’ too many times to count, I suddenly realised I wasn’t living by them, especially in the weeks since I stopped working (still too busy with uni to go back).

I realised I haven’t been taking my incoming amount and dividing it, starting with ten per cent for myself. I’ve been working my budget the other way, deciding how my income can cover my budgeted amounts. Hence, the first thing that stopped when I stopped working was our saving!

This needs to get turned on its head – as of this coming week, I will put 10 per cent of our incoming funds in our emergency fund, then work out how the rest of the budget can adapt. We can definitely spend less on food and petrol, and on our miscellaneous category.

Basically, I shouldn’t be treating our variable expenses as fixed ones – this is stopping me from fulfilling one of the basics of wealth creation and consequently, we are not making any progress!

Ah, goodness! Here was I, many moons ago, thinking that getting out of debt was the only hard part. It seems there is always more to learn, and more behaviours to adapt!

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