Where things are at overall

As some of you are aware I've been working through a legal issue in recent times. While this caused anxiety and upset when it first came up I quickly came to terms with what I needed to do - namely focus on dealing with the legal aspect and ignore the questionable morals (or distinct lack of morals) involved.

The upshot of the saga is that a very good friend lent me some money to pay out my ex-husband. I'm extremely grateful for the financial assistance I have received from my friend as it meant I now have some breathing space and time to prepare my house for sale. I need to repay the loan by February so I am working hard to get the house tidied up ready for sale. Funnily enough I am ok with having to sell the house. I had planned to do this in the future anyway, although I would have preferred to be able to wait for the market to recover somewhat.

Today I have builders in renovating the bathroom. Months ago I had purchased everything needed for the renovation so it made sense to me to get that job done before putting the house on the market. I've also started painting the hallway so that job is more than half done. The other significant piece of work needed is to get the lounge ceiling and walls painted. My neck problems won't allow me to do that job by myself so I will be putting a call out to see if I can get some help from my friends. The only job I need to do is tidy the section up. It's pretty rough around the edges, a bit jungle-like so will need a bit of effort put in.

I've decided to market the house myself without using a real estate agent. This decision has been made from a pure financial perspective. There is so little equity left in the house I simply cannot afford to lose 3-4% of the sale price to an agent.

In a nutshell, that's where I am at. Anyone who is handy with a paintbrush / roller please let me know. :)

Update on no-spend month - one week to go

With one week to go I thought it was timely to report on how the no-spend thing is going for me. As previous posts show there were some minor slips earlier in November but overall it's gone pretty well.

Until Sunday anyway.

We did go out for dinner as discussed in a previous blog entry, for my eldest son's birthday. Five of us had a wonderful meal at the Southern Cross in Wellington - this place was chosen because they do stone-grill which is a favourite of the birthday boy. To be honest I like stone-grill too - it's one way of ensuring your steak is cooked exactly how you would like. The evening was quite mild so we sat out in the garden bar. We enjoyed watching people who had turned up for the Sunday night free dancing lessons. None of us were game to join in but it was interested to watch.

The evening cost about $250 (eek!) but was worth every cent. That was for five adults including our drinks so not bad overall. After dinner we went home for birthday cake as shown below. Just so everyone is aware, my son just turned 23 but it's a bit of a family joke to have kiddie birthday cakes - last year was a race-track and this year the theme was Batman. My youngest son's girlfriend did a wonderful job with shaping and decorating the cake.



I will draw up a report at the end of the month showing exactly what was spent and maybe some tips on how to "not spend".

One small slip and a big one looming

Today I confess that I bought my breakfast from a cafe - $7.50! It was delicious but it felt so wrong to be eating it. To explain how this came about...... I went to the gym at 5:30am (this is normal for me so don't panic on that!), drove to town and arrived at work too early to get in (7:30am). I then realised that I had an 8am meeting, a 9am meeting and a 10am meeting - no time for breakfast at work which is what I usually do. So I ducked next door to work and had some yummy scrambled eggs on toast with peppermint tea. Maybe this is a justified spend? Or maybe I should have planned things better.

The upcoming big issue is that it's my son's birthday on Monday. I planned ahead on this one and bought his gift last month and thought I was very clever. What I hadn't planned on was his birthday dinner. The way I work birthdays is to let my sons decide what they would like to do for their birthday dinner. I thought I could set things up for a dinner at home - food of his choice. But, when I broached the subject he was dead set on eating out at a stonegrill place. I very subtly tried to sway him but he was firm about what he wanted. So I have agreed - what an indulgent mother I am (some would say over-indulgent). But, you know, it is a long time since we were all out together for a meal (probably February!) so that is what we will do.

Day 11 - fail on no-spending

Well today is day 11 of my no-spend month and I failed! Luckily it wasn't a big fail at all. A total spend of $2 so I am not kicking myself too hard. :) Basically I caught an earlier train to work this morning and then a later one home - I chose to travel on the "comfortable" train (the Wairarapa one) instead of the usual electric unit. Travelling on that train costs me an extra dollar each way on top of my train pass.

I am pretty happy with my progress on this no-spend thing. It has really made me think about the choices I make.

We are moving towards summer here in New Zealand and I was thinking about my summer wardrobe - or lack of it - there are some really yummy fashions in the stores at present and I spotted a few things today that made me drool. Then I thought about the clothes I already have and realised that I am not wearing most of my summer skirts because they are too big for me (a bonus in some ways as it means I haven't put on the weight I lost at the beginning of the year). So I decided today that I will drag my sewing machine out this weekend and alter my skirts. I figured that I used to sew the majority of my clothes in the past so I am more than capable of taking my skirts in to extend my wardrobe. Yay for me!

8 days down - one slip

As I reach the end of day 8 of my No Spend month I am pretty happy with how it is going. As mentioned in my previous post I met my brother for lunch the other day. We had an awesome lunch sitting in the sun on a glorious Wellington day. It was great to catch up with him and totally worth the $23 it cost for lunch.

All in all the challenge is going well. It has certainly changed how I think about what I am doing every day. The only issue I have is that I have a list of things that is growing day by day of items I need to spend money on - next month. I need some putty to repair my garage window. I need some chicken wire to repair my strawberry bed cover. I am also plotting an extension to my chicken coop so that will require a bit of timber as well as chicken wire.

We've had a great weekend weather-wise - if this is indicative of what summer is going to be like I will be more than happy. The fine weekend has meant I have almost managed to finish painting the garage, mowed all the lawns and been busy in the garden weeding, planting seeds and watering. I made a point of taking my "before" photos of the garden on Friday so will post those sometime soon.

4 days down

My No spend challenge has been all good so far.

I have needed to make sure I bring a couple of extra small snacks to work and have tended to stay away from shops to avoid temptation. I was worried yesterday as I flew to Auckland for the day for a training course and felt sure I would end up hungry or thirsty on the trip home. Luckily the lunch provided on the course was substantial and the airline provided some very nice cheese and crackers (and a free beer) so I didn't end up spending a cent! In fact I couldn't face eating any dinner when I did get home.

Sadly tomorrow I think I will fail. I am meeting my brother for lunch in the city and am certain we will end up going to a cafe for lunch. We only meet a few times a year so I figure this slip is ok (with me anyway). What I plan to do is have a late morning snack so I won't need to buy a lot and probably skip having a drink. That will keep the cost down. If I can do lunch for under $10 I won't be too worried as I sold a chess board on Trade Me for $10 so that can pay for lunch.

No-spend month is underway

I mentioned last month that November was going to be a no-spend month for me. Well, today is the 2nd November and so far so good. :) Only another 28 days to get through.

Just to re-cap, no-spending to me means no spending on anything other than essentials. So I will still be paying the mortgage and other bills and will still be buying groceries. But no spending is allowed on entertainment, eating out, hair appointments, clothing purchases etc.

Yesterday was a struggle but I managed to get through with no spending. On Saturday night (still October) I went out to celebrate an impending wedding with friends. This was a big night out for me and I had booked into a budget hotel for the night so I didn't have to find my way home. I woke in the morning feeling slightly under the weather and quite tired. Normally I would have found a nearby cafe and had a nice hot breakfast to kickstart my day. But it was the first day of my no-spend month so I headed home and made myself breakfast. It was a lovely sunny morning so was nice to be at home having breakfast in the sun. After breakfast I spot-primed two walls of the garage in preparation - I get all the fun!

In the afternoon I met a friend to go to the movies. I made sure I ate lunch beforehand and took along a bottle of water from home. That was a successful strategy except that the movie (Julie and Julia) made me feel hungry! I had a voucher for the movies (part of my birthday gift from one of my sons) so no money spent there. After the movie I went straight home and cooked dinner. So no money spent on Day 1! Yay!

Today I have made sure I have brought along plenty of food from home to work so no need to go buy any snacks through the day or on my way home. I made a muesli slice on Saturday to use up some old cereal so that is my "treat" for the day.

I will be posting a bit more frequently this month to give you progress reports.

Downsizing

Another step in my master plan of reducing my outgoings is to downsize my house (and subsequently my mortgage).

In the next little while I will have an empty nest and this house is too big for one person and three cats. It's not like it is a mansion by any stretch of the imagination but it is a typical suburban family home . I still have a hefty mortgage outstanding and it makes sense to me to buy a smaller, cheaper property.

Of course I will still need a reasonably-sized section so I can still have my chooks and vegetable garden but there are definitely properties around which would fit my requirements. I can envisage a 2-bedroomed cottage with a decent size backyard.

Before I can sell my current house there are a few projects that need to be finished off - my bathroom renovation for one. Plus my lounge and hallway needs some re-plastering and painting. Finally the carpet right through the house really needs to be replaced. So my focus is to channel all spare cash into completing these projects so that the house is ready to sell some time next year. That No-spend month is coming up soon so that should help.

What are your priorities?

I have plans to have a No Spend month in November. To me this means I will not spend money on anything that is not necessary. In reality this means no dining out, no outings (that cost money), no clothing purchases, no treats.

When I was considering doing this I realised that for this to be successful I needed to figure out what my priorities are. Of course I could spend money on a meal out but that would mean less money put aside in my savings account. Please don’t think I am one of those people who save, save, save and never spend their money. That is definitely not me. I have some goals to achieve and to be able to succeed with those goals I need to save money. So, for me, it is a no-brainer. If I want to be able to have my lounge re-plastered and painted I need to put money aside. If I want to upgrade my ugly, aging bathroom I need to put money aside. If I want to landscape my front garden I need to put money aside. Getting that work done is more important to me than going out for a meal.

Having a No Spend month should boost the coffers quite nicely and will provide me with an incentive to look at what frivolous spending I can curb without too much pain.

All those small expenses add up to significant amounts of money that could otherwise be saved for those higher priorities. If you are a coffee drinker and spend $3.50 each working day for a takeaway coffee, that mounts up to $840 annually (calculated at one coffee five days a week for 48 weeks of the year). I’m not a coffee drinker so my estimate of $3.50 for a takeaway coffee may well be incorrect but you get my drift right?

Consider what your goals are that require money. Would you like to buy an investment property? Would you like to upgrade your home or car? Would you like to take time out from work? Would you like to rid yourself of debt?

Write your goals down. Work out how much you need to save to achieve those goals. Figure out which goals are most important to you and review your goals regularly. Consider what you are spending on items you could live without. Next time you are about to spend money think about your goals and consider whether the expense is necessary or not. If it’s necessary is there a cheaper option?

For anyone who thinks my bathroom upgrade is frivolous here is a photo of the current bathroom. I’ve lived with it for 8 years and fervently hope that I can upgrade it within the next year.

More ideas for reducing outgoings

In our day to day lives there are several areas we can look at to reduce our costs. Here are some changes we have made.

Use the library - I read voraciously. When I was at school someone came in one day and taught the class how to speed read. I caught on to that and now can't read any other way. The negative side of this is that I race through books very quickly. One example is a 10 day holiday we had a year ago where I took 6 books to read. Within the first few days I zoomed through those and went and bought another 6 books. That was only just enough! In the past I bought lots of books (I really don't want to add up how many books or how much they cost me!) to feed my habit. I did try to pick up books on special when I could and bought second hand sometimes too. But, still, it was an expensive habit. With our new budget in place I knew that couldn't continue so now I utilise our local library. I go every week or two and check out a stack of books. I never get the bestsellers as they cost a couple of dollars - eventually they turn up in the main library collection. Using the library saves us hundreds, if not thousands, of dollars every year.

Take your lunch to work - I used to buy my lunch every day at work. I would easily drop up to $10 a day on lunch, often more. Now I take my lunch 99.9% of the time and it saves me lots. Sunday is my baking and cooking day so you will find me in my kitchen making soup, risotto, curry and other dishes for tasty lunches. I freeze meal size portions and then the Optimist and I can take whichever meal we feel like having that day for lunch. At other times I have made up sandwiches and either eaten them as is or toasted them at work. All of this saves us money but also results in us eating healthier meals than a lot of the food that we would have purchased in the past.

Home baking - As mentioned above, Sunday is my baking day. I calculated the cost of making a batch of biscuits one day and figured out that a batch of Anzac biscuits (usually around 40 biscuits) cost me under $3 to make. This didn't include the cost of using the oven. I would struggle to find yummy biscuits that could compete with that amount of money. There are lots of recipes out there that are really easy to follow. If anyone would like my Anzac biscuit recipe let me know and I will post the recipe.

Transportation - This was a biggie for me. I live 32 kilometres from work and used to drive every day. Parking in Wellington was costing me $12 a day and petrol worked out, as a minimum, at $10 a day. I never know how to work out the cost of wear and tear and subsequently maintenance on a car but I know there is a cost associated with that. So, in a nutshell it was costing me over $100 a week to drive to and from work. When I sat down and worked it out I realised it was a no-brainer to ditch using the car and get onto the train. It's a 15 minute brisk walk to get to the station which is a fantastic way to start the day and also a nice amount of time to unwind at the end of the day. A 10-trip ticket costs $64, a monthly pass $192 and a quarterly pass $547. What a huge saving! Additionally in the summer months I started cycling into work 2 or 3 times a week. This takes about an hour - it's flat the whole way. I would take in food and clothes on the train so on cycling days I wouldn't have to carry too much on my back. The added benefit of cycling in was the sense of well-being from having done some exercise and the subsequent increase in fitness and decrease in weight.

I guess one thing I have done is to be very focussed on reducing what we spend so I don't make excuses and just get on with implementing the change. If it is something that is hard I stick with it for 30 days then reassess how I feel about it. I can't think of any instances where I have reverted to the old (more expensive) way of doing things.

Blog kick-off

Greetings to all who have stumbled across this blog.

I've thought about setting this blog up for quite a while now. I starting following a number of blogs last year when I hit a point in my life where I knew I needed to change my way of thinking, especially in regard to my finances. So this entry is to introduce you to me and explain a bit about what I hope to achieve here. This blog will cover financial planning, frugality, healthy eating and other related topics.

I'm in my mid-forties and I am married to a wonderful guy (let's call him the Optimist). I have two adult sons (one still at home with us) and the Optimist has an adult son (currently travelling overseas) and three daughters who live with their mother but visit and stay with us frequently. We live in a suburb of Wellington (capital city of New Zealand). We both work full-time and earn a great combined income but our overall financial position is not one to be proud of. I think it's a case of thinking that because we have a good income we can then afford to do what we want, when we want to do it. This has resulted in us carrying a significant amount of debt (one credit card and two personal loans) and having no real savings. For quite a while we have lived from payday to payday and the overall position has not improved.

Late last year I sat down and looked at our finances, read a few blogs and decided we needed to take action. So I ordered Dave Ramsey's book (second hand from the US), read it from cover to cover and started the process of getting things in order. Since then we've set up a budget which we re-do each month and have made many changes. The next few articles I post here will explain each of the steps we've put in place.

I'd love to hear from anyone who has feedback or who would like to contribute their own ideas.

Cheers
KC