Managing money to make life easier

[Clues_Of_Blue]

One of the big things that causes stress and sure kicks you about when you already have mental illness to play with is money. Whether you're in debt, just scraping by, or feel like you're working to much to maintain a lifestyle. Here is a place to talk about how to make your dollars go a bit further and take off some financial pressure.

I'll start with some basic pointers:

- Plan a little with food. Make work lunches, decide on meals for the week and stick to your shopping list. If you shop a bit later you're also likely to get a lot of fresh produce at a discount.

- Check regularly (every six months or so) on your utilities. Often there is a better plan out there to switch to. As customers, loyalty to a company usually just gets us a quietly growing bill instead of discounts or rewards. Vote with your feet.

- Same with your home loan, you can refinance to one with a better interest rate, just watch out for exit fees (and LMI if you still owe more than 80% of the house value)

If you have any tips or questions, feel free to share or ask.

[ecomama]

Hey Blue

Yeah most of this can wait... Barefoot IS worth buying but as I said, it can wait.

Superannuation
The reason I mentioned Super is that MOST every day ppl OVERLOOK where their Super is invested and they're losing money!
It costs NOTHING to alter the options of where our Super is invested and you wouldn't BELIEVE the difference those changes made to my Super.

I'm a "Values" person, so I wanted to invest in ETHICAL companies, that was it.

The Super forms you fill in SHOW "high", "medium" or "low" risk next to each company.

I decided to go with 3 HIGH risk. High risk can mean HIGH return and it did for me etc. I'm pretty sure Barefoot talks about this but I'd made the changes I was happy with before reading Barefoot.

The reasons I chose to mention Super are:
- MOST people already have a Super account.
- MOST ppl don't realise they have options.
- it's FREE to change them and really make a difference to your Super balance.

These changes can BOOST your sluggish Super performance into HIGHER return.
Then the money becomes an "Exponential" Investment which is perfect.

Love EM

[ecomama]

Blue I really get that "all at once" bills thing and trying to make the changes to INCREASE your financial situation.

Remember I'm alot older than you! lol. Had more time to reflect on things & change them to suit us.

Changes
When I have "so many things to change". I set myself a goal to CHANGE one thing per quarter or 6 months, unless it's REALLY urgent. (I had to change EVERYTHING in <1y but those were extenuating circumstances as you mentioned).

Bills
Nope won't have all major bills occurring at once.
It's just depressing lol!

I BLATANTLY REFUSE to pay monthly on ANY major bills, it costs hundreds more per year. Nup won't do it.

Years ago I looked at the WHOLE year on a 1 page Calendar.
I put important occasions for us in there like Christmas, Birthdays, Easter, School Holidays.
Then knowing the HEAVIEST months for costs were highlighted out. (My multiple birth children on one day means the entire 3 months before was blanked out lol).

Then I took my BIG YEARLY household Bills ie
- House Insurance,
- Car Rego,
- Car services,
- Comprehensive Car Insurance (elec & water & land rates I deal with slightly differently).

I wrote the cost of each on Post It Notes and put them on the Calendar.
Then swapped them around according to WHEN in the year I could balance the costs out far better.

I knew some would take some negotiating.
ONCE I PAID a 6 month instead of 12 month Rego cost to move it away from a heavy cost period.
It's served me well with reducing anxiety over money (which costs me more than money to fix lol!) so absolutely worth it.

OKAY so elec, water & land rates.
Being a single parent is hard, adding working means less time and a focussed attempt by me to reduce my own stress.

I can't be sitting and paying bills all the time, does my head in.
I HATE getting them in the letter box lol.

I divvied the 3 month and 12 month bills up into fortnights (only had to do this once 5y ago) and if I was panicky, I put an extra $5 on each fortnight lol. Only did that with Water.

Then set up a payment system where this portion of each is deducted from my Bank Account the day after I'm paid.

SO WHEN MY "BILLS" arrive, they usually always show a CREDIT.
Yay. Never any extra costs for late payments, ever.
If I want to I can REDUCE my payments, I can.

For elec they just stop charging me when I'm ahead. I have 1y left on a Solar Contract so all good.

Basically I never think about the bills now.

Hope that helps someone lol.

Love EM

[ecomama]

Blue

GREAT idea re: Insulation. I didn't realise you need the spurty outy stuff lol (technical language there).
Sure!

And ofcourse you SHOULD have as many of those annoying things taken care of as absolutely possible!

WATER SAVING
Gutters ugh... yep, I get it! I replaced our front gutters for the water tank in the front garden.

Soon I need to replace the BACK gutter which is 3 stories high! lol fun... (I'll get those done when I do my Roofing with Insurance money).

For the back garden (on a slope) I am using an eco idea.

I'm getting a CHAIN attached to the down pipe opening on the right hand side.
NOT having a downpipe on that end of the house. (There are 3 downpipes! Getting rid of the middle one I hope!)

At the base will be a shallow basin like shape in the ground with rocks of all shapes inlaid in it.
The water runs down the chain and lands in the rock basin.
Then the water is slowly released through the ground.

In prep for torrential downpours, I'll dig a "creek like" trench to run about 50cm - 1m (and up to 2m in places) from the fence and down through that garden, most will be underneath my plants already growing, watering some compost heaps on the way lol. This needs to be in a snake-like shape to reduce the speed of the water and prevent erosion.

I'll probably inlay this with stones and rocks also.

My Uncle has this and we've already spoken about this. It works a treat in his garden!

Can't wait to have it in mine.

Love EM

[Clues_Of_Blue]

Hey EM,

Yep, I did know you can goof about with where super gets invested, wasn't sure if there was a cost involved. My knowledge there is sketchy, so what you've said helps to clarify that a bit. I'm certainly willing to take a closer look.

I wholeheartedly agree with you about monthly bills, I've kept those to a minimum, though through some of my worst patches with money it's been unavoidable - can't pay annual bills with fresh air, after all - in some cases I haven't been charged extra to do it monthly. Over the last couple of years I have pretty much eliminated monthly bills except my mobile because they literally don't have another option. I'm seeing some annual plans popping up and will switch when my contract is up in a couple of months. Still paying council quarterly, that's the last big one I haven't been able to pull enough together to pay annually yet. It may be an advantage at this point, as the Health Care Card I finally got may make me eligible for a discount, wouldn't want to pay too far ahead before I've explored that possibility.

Honestly, most of my bills aren't that bad for hitting at once, but I've had a bunch of medical/counselling/psych stuff on top of the usual and couldn't save with no income for two months, that has made things messy. Also public holidays mess with what day my pay comes through and where I might normally be cutting things fine it's meant I had to pay something a week ahead of when I might otherwise for the sake of pay being a day late - with a fortnightly rotating roster, it's bad when that hits on the small pay.

Direct debits into bills can be great. Personally I like to do things manually, but it's a similar system. I think I've told you about my bill pool, I calculate what each larger bill would cost per week, add all that up and put that amount aside in savings weekly. Occasionally, when things are off kilter like with my two months unpaid, I will use my credit card and get it paid before the interest free period is up. Uncomfortable, but nothing lost. I don't recommend this to anyone who struggles with impulse control. In any case, no late paid bills here. I think I told you how impressed the broker was at my credit score. XD

Yeah, insulation is a headache here, and I want all those things fixed - I miss having baths and I want working gutters. Love your ideas for water management, sound cool. Not much worry about torrential rains here, so it would be less useful for me. I can picture it though. Lovely.

Blue.

[ecomama]

Yes, LOVE how you're working out stuff for less stress. Topic of this thread "to make life easier" lol.

Ofcourse! Working out WHICH bills WILL save us money if paid yearly. My House Insurance is $350 MORE, calculated over the entire year, if paid monthly so YUCK. KNOWING that is a strong motivator to save & pay ONCE.

Yep I do same thing with my pay.
Got the total of BIG bills and divided it up into my fortnightly pays, set aside those amounts (I leave those in an offset account against my mortgage).
I basically did some Barefoot things by transferring "petrol, food, kids expenses" across to an account he calls a MOJO account lol... mine wasn't a MOJO because it wasn't "fun spending money" for a LONG time.. it was basic needs money.
I still called it a MOJO just for ease and goals lol.

With Council land / water rates, I do have an automatic transfer bec it's less stressful for me to think about. Also it ensures I won't ever pay interest on top bec I'm ahead.

This doesn't SOUND like a big financial thing but it's made a HUGE difference to finances & how I think about myself ie being proud.

I round UP my mortgage payments now (and did before demon)...
I seriously rounded UP by 11 cents to start with!! SOMETHING to make myself feel better that I was chipping away at it. This was in the aftermath of Settlement. My Bank Manager laughed bec she KNEW how much I was struggling financially but wouldn't take this all lying down lol.

Then when payments were reduced last year, as I said, I kept payments at the HIGHER amount.
I'm thinking to round UP to the nearest $500 probably between now & end of year... this will mean an extra $390 per fortnight.... BUT there's no redraw and I might need the money to begin the cabin build, so I'm in a quandary.

Whenever I'm in a quandary, my usual solution is to go 50/50. EG pay extra $390 ONCE a month then save the other $390 against my mortgage... still pondering.

YES!
No cost to change investments in Super.
You'll have to enquire at a later time about that with your Super but it's well worth thinking about.

It made the HUGEST difference to my Super balance.
In less than a year my Super had made up what I had to give to demon.

Dusting my hands lol.

I started "extra Super contributions" last year. I'd NEVER contributed to my Super personally before lol! So I pay extra $40 per fortnight now. I can increase / decrease at whim.

Love EM

[ecomama]

Okay I've kind of decided on a financial strategy to implement which will help achieve my goal of building the cabin to lease after it's all built.

"kind of" meaning it's flexible because the last thing I want to do is trigger "poverty" reactions in myself.

I'm not sure why I chose the figure $390 but I did lol.
I've decided to put an extra $390 into my mortgage at least once a month and maybe twice if I can.

Today I saw on my mortgage details that they've given me a REDRAW facility, how kind!
NOT.
This is set up by banks to entice us to remain in debt. I'm not fooled.

If I DO have to borrow to build the cabin, ofcourse it's a DEBT.
But it's also an INVESTMENT with huge returns in our area and esp where I live.
Great Tax breaks too!!

But I'm kind of wanting extra cash behind me for WHEN things go wrong, as they invariably DO, when building.

Waiting till the end of the year / beginning of next year to re-mortgage will help rid extraneous debts and by then I'll have fewer "dependents" living at home for their calculations. Plus a higher wage.

When I first re-mortgaged due to Family Law, I rounded UP my repayments by a WHOLE 11 cents lol! I was still paying HUGE amounts for Legal Fees and other debts I took on as part of settlement. demon made a massive error and I ran with it lol. These debts lasted over a year.

Then we breathed OUT.

When Banks reduced mortgage interest I kept my repayments same = $140 extra per month.

THIS simple thing meant that I'm now over $1000 ahead by doing almost nothing.
The redraw makes no difference.
BUT if I need it to build cabin it's there.

Hence putting the extra $390 in.

Car rego / green slip due soon. Party for Yvette too but I still want to add $390 extra to my mortgage. It will work FOR me in new loan applications to re-mortgage.

Time to call loans in lol! I'll get onto that this week. 😉

I'll begin next pay and let you know how I get on! Eeeek I'm excited!

Love EM

[Clues_Of_Blue]

Hey EM,

Working out money for less stress is the primary motivator for me. So stuff like the cut veggies, that's an investment in mental health! Same with things like picking which bills will be monthly vs annually. They dropped the 6 monthly option off rego a few years ago here, right when I was about to do that because I was too poor for annual but not so poor I couldn't do 6 months. Sigh. But then a weird thing happened recently, they decided to give us a choice of insurers for the mandatory insurance portion of the bill, and the competition drove prices down, so I've been able to pay annually and am paying about $100 less a year. Noice.

I thought the mojo account was for emergencies/sense of security. Anyway, I have that and so far most of what Barefoot recommends in the first 100 pages (that's how far in I am), which is a bit disappointing. I guess it's at the investment portion of the book I'll start seeing stuff I don't already know, saving and conscious spending I think I've pretty much aced.

Rounding up is great, even just a little. I think in similar terms and also pay extra on the mortgage. When I was on near full time hours, I didn't just throw the extra money around, I thought on how I could keep my expenses from creeping up and could give the mortgage an extra $50 a week (plus however many cents are in my account at the time), and when the interest rate dropped, kept paying the old amount plus my $50. It adds up.

I do the 50/50 thing, too. Spare money? Half in savings, half on mortgage.

I'll have a crack at super when I'm up to it (could be a while). I won't make extra contributions at this point, I agree with Barefoot re paying off the house first. Our situations are different due to age and how much mortgage remains.

Flexible strategy is good for the cabin, take care of your mental health as you go.

$390 is as good a figure as any. 🙂 Mine has redraw, too. I only look at it to see how far "ahead" I am, and smile to myself. I wouldn't touch it without a heck of an emergency motivating me. We got through my partner's surgery without it.

Cabin debt is a calculated risk, and definitely a worthwhile investment. That said, having an emergency fund is essential for such an undertaking. Good plan.

Sensible timing planned for refinancing, you want some things in your favour. Great to see your strategy has put you ahead on current mortgage, I'm about $3K ahead doing same.

Looking forward to hearing how it all goes. 🙂

Blue.

[ecomama]

Hey Blue, you're doing SO WELL.

Yeah I didn't learn anything for a while in Barefoot.
Maybe I'm calling "mojo" accounts the wrong thing lol, I thought it was the "fun" account.
He has accounts everywhere. But no mortgage. He even recommends NOT having an Offset Account (but to invest it) but he also runs his own Business so can reduce and write off things like Govt Taxes on Interest made in Investment Accounts.

I cannot atm.

It's a double whammy saving having an Offset against mortgage.
One - no interest taxed on an Investment account.
Two - reducing interest charged on balance of mortgage just by saving there.

Indeed he talks about Super alot.
Being younger it would be worth looking at that extra Super account or changing - LATER.

I looked at mine then and it was doing far better than others. Running costs were far lower.
I'd already diverted my Super Investments and as I said, they did magnificently AFTER separation lol! Still are.

I went hell bent during that horrid marriage to put every single cent into my mortgage until D Day when I took all my money OUT.

I won't do it anymore to that degree because of wanting to enjoy the kids while they're still at home and support them where I can. We've been through hell of all sorts and going back to the transfer of every cent isn't on my radar. Maybe after they leave home - IDK.

BUT I will "commit" to the extra $390 on a schedule. Just in the first pay each month then choose for the 2nd pay.

I can't believe you guys had NO choice of Insurers!
How disgusting. I think we've had choices here from the get go of introducing Green Slips many years ago, from memory.

I think we still have the 6 month rego option, not sure. Still it's more expensive so I won't do it unless I need to change due to "heavy cost months". Don't need to atm.

Better go! Doing prep for hospital tomorrow.

Take care!

Love EM

[Clues_Of_Blue]

Thanks, EM. 🙂

Yeah, I think you're thinking of the "splurge" account. He sure does have a lot of them. Me, I'm not sure I want to split my money up quite so much. We'll see, I'm weighing up options. Already have a bunch of accounts.

I haven't come across his thoughts on offset accounts, yet. I think an investment account would have to be doing awfully well to be of more benefit than an offset, personally. Reducing debt/interest is as good as earning, in my opinion. If you save more by having an offset than you make by investing then you're doing it the right way. I guess it's a numbers game per individual situation. Where you're at I think you're doing exactly what you need to be doing.

I did have a goosie at the fees my super provider charges after I read that bit of the book. They're actually fairly reasonable, comfortably under the threshold at which he suggests seriously considering changing super funds. Can probably save myself some hassle, there. I'll look closer at the super investment options at a more opportune time. There's more in there than I thought there was by quite a bit, so it's not performing terribly (no idea how it compares on the market, at this time) - it can wait for me to get myself together on more urgent matters!

I think you're on the right track not putting every penny in the mortgage right now. There has to be a balance between living life and saving money. Putting yourself in misery and not getting the most out of family time is not the best use of your money, in my opinion. But having goals and specific figures in mind is healthy and good, we both know that being too free flowing with money isn't any better than being miserly with it. That word again, balance. Committing to giving the mortgage an extra $390 once a month and playing it by ear with the other pay cheque is balanced.

Yeah, we South Aussies get slugged the hardest in the country on a lot of essential bills, rego being one of the main ones, in large part because of the insurance situation - only the last two years I think we've had a choice. A friend of mine said it's cheaper to register his 4WD in VIC than to do his motorbike in SA... I was super surprised to see any drop in the cost of it at all, it had been going up on pretty much every renewal for years.

Good luck with the hospital tomorrow.

Blue.

[ecomama]

Thanks Blue, feeling pretty sick after hospital ugh.
I hope YOU are feeling better!

Re: offset VS investment accounts (in my particular case).
If I invested all my savings into any type of investment account, I'd be paying 50% interest via my Tax Return on the returns.
Historically when I've looked at the interest rates, they're LESS interest rates than my mortgages were.

Meaning, I would need an investment interest rate DOUBLE my mortgage interest to break even!

Offset accounts against home mortgages, at least, do not attract Personal Income Taxes.

So that's me anyway lol.

Re: vehicle registration
Crikeys that's highway robbery having a dictatorial method of compulsory insurers.

Mine's due this month and I got some info for you just FYI lol.
My CTP Green Slip is $465
My NSW Car Registration is $541.

I usually get Comprehensive Insurance yearly but will get the one in between CTP and Comprehensive this year - can't remember what it's called lol.

Re: extra mortgage payments
Yeah gonna do it that way. Just JUMPING INTO THE ABYSS on paying the extra $390 in the first pay and might do in the 2nd fortnightly pay also.

Re: extra Super contributions
Am keeping to the $40 extra per fortnightly pay.
I didn't miss it, so it's something. Works out to be another $1000 or so per year, so it'll help!
The way it's structured, I'm being taxed slightly less on this highest income atm and taxed later on just these which is fine bec I figure my income will be lower then and won't be taxed much at all.
Certainly NOT at the tax rate I'm paying now.

NB
LOCAL OFFERS:
PLEASE check what your Local Council, State Govt and all else is offering atm!

We've received:
* rebates on 2 water tanks.
* rebates on Solar Panels.
* Free water reducing shower heads, with free installation.
* $200 for a ceiling cavity full of Insulation.
* free energy saving light bulbs.

Last week an offer was in our mailbox for ALL light replaced with LED light bulbs for $33 no matter how many are in the house.
Might check this out!

Love EM