As I mentioned in passing during my 30 day blog challenge I LOVE Christmas. I love the music, the colours, the magic, the food, the lights. I just love the festive season.
Now as is obvious from my recent manage your money series I also LOVE saving money and spending wisely.
Have a guess when I started planning for Christmas??
It wasn't September 16th - 100 days before Christmas - nor was it July 25th which is considered the half way point of the year by most.
Nope, this little Christmas lover was planning for Christmas in January.
Close your mouth before you catch a fly. It's not THAT shocking, I just love to be organised.
I start my lists early in the year.
I have a food list, a baking list, a gift list, an Elf on the shelf list, a family activities list, a kids craft list...I also love lists in case that wasn't obvious too.
The lists get started early in the year then around March or April I start buying items here and there. I add an extra chicken to the grocery shopping to store in the freezer for Christmas lunch, I buy craft bits and pieces and put them aside, if I see books or puzzles or small toys that would make great stocking stuffers I buy them and hide them in my closet - shhh no one tell my kids - but most importantly I also set my Christmas budget.
In years past we've never really set an exact amount per person but I never went over $100. This year as we have started on our 'getting out of debt' journey we've set a limit of $50 per person. This includes our kids, our family and each other.
I have always been a firm believer in the old saying "it's the thought that counts". Humanity has become so materialistic, which explains why so many people are in debt up to their ears, but we haven't just fallen in love with our possessions we've also become very competitive, we have to have bigger and better belongings than the guy next door.
The biggest favour you can do for yourself at Christmas time is to stop thinking that way. If your family and friends are upset that you don't spend a lot of money on them then are they really worth your time and love?
The reason why I start so early with my Christmas plans is because I do love the season, I want to do special activities, have huge meals, decorate the house, make it magical for my kids, but I don't want to be sent broke to achieve it.
Christmas happens at the same time every year there is absolutely no reason why you can't be prepared for it. It's not an emergency that just sneaks up on you, so no using your emergency fund to spoil your kids or to buy a new tree, it is an annual event. You don't need to start in January but give yourself and your budget a fighting chance to make it out unharmed. October is close enough for the Scrooges among us yet not too close that you have to choose between milk and bread or nan and pops Christmas gift.
Set a limit for each person, then add one person per week to your budget. Before you know it you'll have everyone's gifts under the tree and no extra debt.
I want to add here a belief of mine. I am not religious so I don't preach "Christmas isn't about the gifts it's about celebrating the birth of Christ" if that's your thing then celebrate to your hearts content.
For me and my lack of religion Christmas still isn't about the gifts. It's about spending time with your family and friends, creating memories that will last longer than any new gadget ever could. Your children will appreciate the activities you do as a family far more than what was under the tree. I'm 31 years old and I can name two gifts I received as a kid. A cabbage patch doll from my Nana when I was five and a baby doll and cradle from 'Santa' when I was nine and it's because I still have both.
What I do remember is going into the city each year and seeing the Christmas window displays at David Jones and seeing the huge tree in Martins Place. Exploring Santa's village at what was then called Grace Brothers.
Don't spoil your children with presents and create another generation of materialistic debt owners. Spoil your children with memories as they are what last and will be remembered in years to come.
P.s there's only 94 sleeps till Christmas ! :)
Skye
- Posted using BlogPress from my iPad
Monday, September 22, 2014
Monday, September 8, 2014
Cheaper Than A Dentist....
Before I get started here I need to point out that at the end of the day the best way to maintain great oral health is to brush - twice daily - floss, try to cut sugar from your diet and have regular dental check ups.
However my blog is about saving you money and let's be honest some over seas trips are cheaper than an appointment with your dentist.
This brings me to Oil Pulling.
Before you run and hide hear me out.
I've been seeing articles on oil pulling here and there for about a year now. If you haven't let me explain:
Oil pulling is the act of swirling a spoonful of oil around your mouth for approximately 15 minutes. As the oil swirls around your teeth and gums it's pulls out toxins, bacteria, that build up to cause plaque and gum diseases after your time is up you spit out the oil and the bad bacteria with it. People who have done it boast of healed cavities, whiter teeth, and all over better oral health.
When I first read about it I thought it sounded painfully similar to the times when my parents used to threaten me with a spoonful of castor oil for misbehaving and I wasn't entirely sure it was something I could do.
Fast forward to June this year and on returning from our overseas trip I found myself with a constant tooth ache. It wasn't just one tooth. My entire mouth just ached 24/7. I was positive that had I managed to find the cash to send myself to a dentist I was going to be faced with a few thousand dollars worth of work and a prescription for antibiotics to fight gum disease.
So instead of $220 for a dental consultation I spent $17 on a jar of organic coconut oil.
You can choose any oil you like for this activity. Sunflower, grape seed etc... I chose coconut for it's taste and it's known attributes. Be careful which oil you choose as I've read that some of the yellow oils can stain your teeth.
Coconut oil has become my second love - next to vinegar - simply because it's one product that has a million uses.
I'm not going to get in to the science - I'll post a link to Wikipedia at the bottom of this post for those who are interested - but in a nutshell coconut oil has anti bacterial properties which is why it's so great to use in oil pulling. When ingested our bodies react to the oil which gets the whole process started. The oil turns on it's antibacterial agents and they go to work pulling all the crap from your mouth that toothpaste doesn't even know is there.
Three days of doing this was all it took to get rid of my toothache. I'm hypothesising here but what I think happened is that those antibacterial properties went to work on my gums and got rid of the bacteria that was causing what I believe was the beginning of gum disease. If I had gone to a dentist he would have prescribed antibiotics to do the job.
I use half a tablespoon of solid coconut oil, which when melted in my mouth turns into probably more than a tablespoon, and swirl for ten minutes. That's right I broke the rules.
Everywhere I have read up on oil pulling says to swirl for 20 minutes. 15 if you can't manage the 20.
I could barely manage ten minutes when I first started, but after the first two days it got a lot easier.
I did it while showering so the time passed quicker. There is mixed feelings on what to do with the oil once you're done. As coconut oil solidifies when cold some say you should not spit it down the drain in case it causes blockages. I believe that once it's been swirling in your mouth for ten minutes gathering crap it's make up changes and what you spit out is no longer capable of solidifying. So at the end of the day it's up to you. If you're worried spit it in a cup and pour it out in the garden.
Two months later and now I oil pull once every three days, sometimes longer if I forget. I haven't had a tooth ache since I started.
I still have sensitive teeth, this isn't a complete miracle worker, but it has worked on keeping my gums healthy.
My jar of coconut oil cost me $17.95, I've had it for two months and have about four days left before I'll need to replace it.
The point of this post is to basically tell you that yes you should see a dentist if you're worried about your teeth, Yes you should brush daily, and Yes you should certainly give oil pulling a try if you want to avoid huge dental bills for just a little longer.
Give it a try and let me know what you think.
http://en.m.wikipedia.org/wiki/Coconut_oil
Skye
- Posted using BlogPress from my iPad
However my blog is about saving you money and let's be honest some over seas trips are cheaper than an appointment with your dentist.
This brings me to Oil Pulling.
Before you run and hide hear me out.
I've been seeing articles on oil pulling here and there for about a year now. If you haven't let me explain:
Oil pulling is the act of swirling a spoonful of oil around your mouth for approximately 15 minutes. As the oil swirls around your teeth and gums it's pulls out toxins, bacteria, that build up to cause plaque and gum diseases after your time is up you spit out the oil and the bad bacteria with it. People who have done it boast of healed cavities, whiter teeth, and all over better oral health.
When I first read about it I thought it sounded painfully similar to the times when my parents used to threaten me with a spoonful of castor oil for misbehaving and I wasn't entirely sure it was something I could do.
Fast forward to June this year and on returning from our overseas trip I found myself with a constant tooth ache. It wasn't just one tooth. My entire mouth just ached 24/7. I was positive that had I managed to find the cash to send myself to a dentist I was going to be faced with a few thousand dollars worth of work and a prescription for antibiotics to fight gum disease.
So instead of $220 for a dental consultation I spent $17 on a jar of organic coconut oil.
You can choose any oil you like for this activity. Sunflower, grape seed etc... I chose coconut for it's taste and it's known attributes. Be careful which oil you choose as I've read that some of the yellow oils can stain your teeth.
Coconut oil has become my second love - next to vinegar - simply because it's one product that has a million uses.
I'm not going to get in to the science - I'll post a link to Wikipedia at the bottom of this post for those who are interested - but in a nutshell coconut oil has anti bacterial properties which is why it's so great to use in oil pulling. When ingested our bodies react to the oil which gets the whole process started. The oil turns on it's antibacterial agents and they go to work pulling all the crap from your mouth that toothpaste doesn't even know is there.
Three days of doing this was all it took to get rid of my toothache. I'm hypothesising here but what I think happened is that those antibacterial properties went to work on my gums and got rid of the bacteria that was causing what I believe was the beginning of gum disease. If I had gone to a dentist he would have prescribed antibiotics to do the job.
I use half a tablespoon of solid coconut oil, which when melted in my mouth turns into probably more than a tablespoon, and swirl for ten minutes. That's right I broke the rules.
Everywhere I have read up on oil pulling says to swirl for 20 minutes. 15 if you can't manage the 20.
I could barely manage ten minutes when I first started, but after the first two days it got a lot easier.
I did it while showering so the time passed quicker. There is mixed feelings on what to do with the oil once you're done. As coconut oil solidifies when cold some say you should not spit it down the drain in case it causes blockages. I believe that once it's been swirling in your mouth for ten minutes gathering crap it's make up changes and what you spit out is no longer capable of solidifying. So at the end of the day it's up to you. If you're worried spit it in a cup and pour it out in the garden.
Two months later and now I oil pull once every three days, sometimes longer if I forget. I haven't had a tooth ache since I started.
I still have sensitive teeth, this isn't a complete miracle worker, but it has worked on keeping my gums healthy.
My jar of coconut oil cost me $17.95, I've had it for two months and have about four days left before I'll need to replace it.
The point of this post is to basically tell you that yes you should see a dentist if you're worried about your teeth, Yes you should brush daily, and Yes you should certainly give oil pulling a try if you want to avoid huge dental bills for just a little longer.
Give it a try and let me know what you think.
http://en.m.wikipedia.org/wiki/Coconut_oil
Skye
- Posted using BlogPress from my iPad
Monday, September 1, 2014
The Weights Been Lifted!
At this point in The Total Money Makeover we would only be at step four of seven.
I'm going to condense the last of the steps into one post for one very good reason.
If you have made it this far then the world is yours! You should only have one monthly repayment - being your mortgage - you are otherwise COMPLETELY debt free and you've built up an emergency fund that will sustain you and your family for a few months in an emergency situation.
At this stage I think you've become money savvy enough to decide where to go next and to do so without going backwards and digging yourself into a huge debt crater again.
However if you love the idea of early retirement or fully self funded retirement then keep on reading.
The last step was building our emergency fund and for renters it included saving a house deposit.
Step four is invest! I'm really looking forward to this step. As an adult child who is supporting a parent who lives on a government pension I know what I DON'T want for my future, or my children's future.
Investing early on in life will set you up for a beautiful retirement where the only thing you will need to worry about is your health. You will not need to worry about paying rent, electricity bills, living on beans, taking the bus. Investing now will take care of you financially once you finish working.
Take the time and spend the money to talk to someone who comes recommended, someone who knows and lives investments. This is really the only advice I can offer on the topic as I'm a newbie to it myself. Later on I'll write a post sharing links to useful information but for now the only thing I know is you want to find someone who knows what they're doing.
A good investment will let you travel the world, eat at fancy restaurants, pay for your children's wedding none of which can be done on a government pension. And don't think your superannuation will do the job either, that may last you twenty four months if you're lucky.
Step five is to save a college fund for your kids. This step comes with some personal opinions from me.
I will be saving money for my children BUT I will be teaching them to save too. In fact we have already started. They don't get a lot of pocket money at the moment after all they're only four and two and don't do much in the way of chores. They get silver coins for random actions. Helping each other or mum and dad, taking their daily vitamin, Miss four often asks to help dry the dishes - I'm hoping that trait sticks around - and Master Two 'helps' pick up after the dog - he tells me where it all is :)
Packing away toys, using manners and cleaning their rooms are not actions they get pocket money for. Each month they count their money and they get half to spend and half goes back into savings.
Also I'm not necessarily saving for college. If they choose to go to university then that's where it will go if not it can go towards a car or even a house deposit once they are working.
I'm calling ours the 'kid fund' not the college fund.
Step six is to pay off your mortgage. At this point in your life it should be a piece of cake. NO debt, a fully loaded emergency fund that will cover you for approximately 3-6 months and a couple of amazing investments doing their thing to make your retirement wonderful. There is nothing stopping you from throwing all you have at your mortgage and saying goodbye to it ALOT sooner than you ever thought possible.
And last but not least, step seven.
Step seven is to give. Back at steps one and two where we were living on beans on toast, never going out and taking the bus to save on petrol I mentioned I was of the belief that you only give if you can truly afford it. For some families it's hard to find enough money to support themselves let alone worrying about giving to help others. It's not being selfish or careless it's about self preservation and not perpetuating the cycle.
Step seven is great because once here you can help out every one you want. Support every charity that means something to you and not worry about going without yourself.
I'm so excited about this plan. It's basic common sense but it's the kind of common sense that when you're drowning in debt you need someone to shout it at you. The Husband and I have only been at it a few months. We've got our $1000 emergency fund, we've paid off one credit card, half way through the next and have big plans for our retirement.
We are also discussing what we are doing with the kids, they may not fully understand but Miss four at least is making plans for our 'own' home. She's got a list of what it needs once we've saved enough money.
We talk to them and explain it so they learn that having the newest things isn't the most important part of life. By teaching them now they'll hopefully grow up to never have any debt, other than a house, of their own.
Thank you to everyone that has read along and asked questions I hope you all see a happy step seven somewhere near in your futures.
Skye
- Posted using BlogPress from my iPad
I'm going to condense the last of the steps into one post for one very good reason.
If you have made it this far then the world is yours! You should only have one monthly repayment - being your mortgage - you are otherwise COMPLETELY debt free and you've built up an emergency fund that will sustain you and your family for a few months in an emergency situation.
At this stage I think you've become money savvy enough to decide where to go next and to do so without going backwards and digging yourself into a huge debt crater again.
However if you love the idea of early retirement or fully self funded retirement then keep on reading.
The last step was building our emergency fund and for renters it included saving a house deposit.
Step four is invest! I'm really looking forward to this step. As an adult child who is supporting a parent who lives on a government pension I know what I DON'T want for my future, or my children's future.
Investing early on in life will set you up for a beautiful retirement where the only thing you will need to worry about is your health. You will not need to worry about paying rent, electricity bills, living on beans, taking the bus. Investing now will take care of you financially once you finish working.
Take the time and spend the money to talk to someone who comes recommended, someone who knows and lives investments. This is really the only advice I can offer on the topic as I'm a newbie to it myself. Later on I'll write a post sharing links to useful information but for now the only thing I know is you want to find someone who knows what they're doing.
A good investment will let you travel the world, eat at fancy restaurants, pay for your children's wedding none of which can be done on a government pension. And don't think your superannuation will do the job either, that may last you twenty four months if you're lucky.
Step five is to save a college fund for your kids. This step comes with some personal opinions from me.
I will be saving money for my children BUT I will be teaching them to save too. In fact we have already started. They don't get a lot of pocket money at the moment after all they're only four and two and don't do much in the way of chores. They get silver coins for random actions. Helping each other or mum and dad, taking their daily vitamin, Miss four often asks to help dry the dishes - I'm hoping that trait sticks around - and Master Two 'helps' pick up after the dog - he tells me where it all is :)
Packing away toys, using manners and cleaning their rooms are not actions they get pocket money for. Each month they count their money and they get half to spend and half goes back into savings.
Also I'm not necessarily saving for college. If they choose to go to university then that's where it will go if not it can go towards a car or even a house deposit once they are working.
I'm calling ours the 'kid fund' not the college fund.
Step six is to pay off your mortgage. At this point in your life it should be a piece of cake. NO debt, a fully loaded emergency fund that will cover you for approximately 3-6 months and a couple of amazing investments doing their thing to make your retirement wonderful. There is nothing stopping you from throwing all you have at your mortgage and saying goodbye to it ALOT sooner than you ever thought possible.
And last but not least, step seven.
Step seven is to give. Back at steps one and two where we were living on beans on toast, never going out and taking the bus to save on petrol I mentioned I was of the belief that you only give if you can truly afford it. For some families it's hard to find enough money to support themselves let alone worrying about giving to help others. It's not being selfish or careless it's about self preservation and not perpetuating the cycle.
Step seven is great because once here you can help out every one you want. Support every charity that means something to you and not worry about going without yourself.
I'm so excited about this plan. It's basic common sense but it's the kind of common sense that when you're drowning in debt you need someone to shout it at you. The Husband and I have only been at it a few months. We've got our $1000 emergency fund, we've paid off one credit card, half way through the next and have big plans for our retirement.
We are also discussing what we are doing with the kids, they may not fully understand but Miss four at least is making plans for our 'own' home. She's got a list of what it needs once we've saved enough money.
We talk to them and explain it so they learn that having the newest things isn't the most important part of life. By teaching them now they'll hopefully grow up to never have any debt, other than a house, of their own.
Thank you to everyone that has read along and asked questions I hope you all see a happy step seven somewhere near in your futures.
Skye
- Posted using BlogPress from my iPad
Monday, August 25, 2014
Pigs Can Fly!
Ok so you may not believe that pigs can fly but you better believe that once you make it as far as this post in your own journey you will be DEBT FREE!!
DEBT FREE!!
If you are buying a house it should be the only debt you have as that wasn't part of step two. If you rent then scream it to the world " We're debt free!"
So what now You ask?
Step three is next and step three is pretty darn important. This is where we build up on our $1000 emergency fund creating a fund that covers 3 to 6 months of expenses.
This isn't a house deposit for those who rent or a month long trip to Europe for those with a mortgage. This is a fully loaded emergency fund so that you NEVER HAVE TO BORROW AGAIN!
We just finished paying off our debt we don't want to go back there. To make sure we stay debt free we need the cash at hand to cover living costs should we lose a job, or to buy a new fridge if the current one breaks down on Christmas Day, or to get a new timing belt for the car - I have no clue what those are by the way but I do know they cost a lot of money.
The length of time you choose to save for depends entirely upon your or your spouses level of anxiety - or paranoia. I'm a pretty anxious - read paranoid - person so we personally will be going for 6 months of expenses.
It's easy to calculate how much you would need. Add up what you spend a month on rent/mortgage, groceries, insurances and utilities then multiply by how many months you want to be covered for. That total is what you will need in your emergency fund.
This should be fairly easy, after all you have no debt and just spent around two years living on bangers and mash to get debt free, going another few months to fill that emergency fund should be a piece of cake. You will have all that money that you were paying on debt payments at your disposal.
Now I am no investment expert, I'm barely a beginner, but I do know this: once you've got the ball rolling on your emergency fund, see your bank about the best type of account to keep your emergency fund in.
You want to be able to access the money without penalty of huge bank fees and without having to wait. It's an emergency fund you need to be able to get to it quickly. However you also want that large sum of money to work for you if it can so an account with a high interest rate for long term savings is what you are looking for, but like I said speak to someone who knows their stuff!
Now if you are renting like me, we're lucky, we get a step 3B.
3B is where you save for a house deposit, preferably 20%.
There is nothing fancy that you do here. Just keep on keeping on!
Stick with your budget. You are debt free and have built a fully funded emergency fund. YOU CAN DO THIS!
While saving this house deposit do your research. Find first home buyers tips wherever you can and the tips you see everywhere hold onto them, they must be good if everyone is saying it.
People have been buying homes for decades, use their knowledge to get it right. We've come so far. We are debt free. The last thing we want is for a rookie mistake to send us back to the bottom, back to step one.
So read up on buying a home, talk to family and friends, invest in an appointment with a professional, just learn as much as you can so that when you have that house deposit saved you can buy the house with ease and move into step four with no worries.
Skye
- Posted using BlogPress from my iPad
DEBT FREE!!
If you are buying a house it should be the only debt you have as that wasn't part of step two. If you rent then scream it to the world " We're debt free!"
So what now You ask?
Step three is next and step three is pretty darn important. This is where we build up on our $1000 emergency fund creating a fund that covers 3 to 6 months of expenses.
This isn't a house deposit for those who rent or a month long trip to Europe for those with a mortgage. This is a fully loaded emergency fund so that you NEVER HAVE TO BORROW AGAIN!
We just finished paying off our debt we don't want to go back there. To make sure we stay debt free we need the cash at hand to cover living costs should we lose a job, or to buy a new fridge if the current one breaks down on Christmas Day, or to get a new timing belt for the car - I have no clue what those are by the way but I do know they cost a lot of money.
The length of time you choose to save for depends entirely upon your or your spouses level of anxiety - or paranoia. I'm a pretty anxious - read paranoid - person so we personally will be going for 6 months of expenses.
It's easy to calculate how much you would need. Add up what you spend a month on rent/mortgage, groceries, insurances and utilities then multiply by how many months you want to be covered for. That total is what you will need in your emergency fund.
This should be fairly easy, after all you have no debt and just spent around two years living on bangers and mash to get debt free, going another few months to fill that emergency fund should be a piece of cake. You will have all that money that you were paying on debt payments at your disposal.
Now I am no investment expert, I'm barely a beginner, but I do know this: once you've got the ball rolling on your emergency fund, see your bank about the best type of account to keep your emergency fund in.
You want to be able to access the money without penalty of huge bank fees and without having to wait. It's an emergency fund you need to be able to get to it quickly. However you also want that large sum of money to work for you if it can so an account with a high interest rate for long term savings is what you are looking for, but like I said speak to someone who knows their stuff!
Now if you are renting like me, we're lucky, we get a step 3B.
3B is where you save for a house deposit, preferably 20%.
There is nothing fancy that you do here. Just keep on keeping on!
Stick with your budget. You are debt free and have built a fully funded emergency fund. YOU CAN DO THIS!
While saving this house deposit do your research. Find first home buyers tips wherever you can and the tips you see everywhere hold onto them, they must be good if everyone is saying it.
People have been buying homes for decades, use their knowledge to get it right. We've come so far. We are debt free. The last thing we want is for a rookie mistake to send us back to the bottom, back to step one.
So read up on buying a home, talk to family and friends, invest in an appointment with a professional, just learn as much as you can so that when you have that house deposit saved you can buy the house with ease and move into step four with no worries.
Skye
- Posted using BlogPress from my iPad
Monday, August 18, 2014
Let It Snow!
Congratulations on completing step one! If you have your $1000 emergency fund - or even if you're on your way there - give yourself a pat on the back. You are one step closer to having no more debt!!
We are now at step two. Step two is where you are introduced to what Dave Ramsey calls the Debt Snowball. The technique has been around for a while and he admits he didn't think it up but he's happy to remind us all of it's existence.
Basically the debt snowball is this...
Start paying your debt off from smallest to largest (mortgage excluded we'll get to that later). You make minimum repayments on everything else but for your smallest debt you pull your reserves. Every cent you can find that doesn't already have a home goes on to that debt. Once you've paid off the smallest debt you move onto the next one rolling over the payments from the last. The reason it's a snowball is because as you cut out more and more payments the amount of money you can put towards the next debt gets larger just as a snowball would when continually rolled in snow.
We start with our smallest debt to keep us motivated. The quicker we see something happening the more motivated we will be to keep at it. The more debt we get rid of the easier it will be to live like no one else.
What I mean by that is right now you should be on a pretty strict budget. You've got your $1000 emergency fund, you're working over time or a second job, you are eating plain basic meals, you're taking the bus instead of the car, you've cut back on take out and entertainment and maybe you're getting a little tired of sausages and mash every Tuesday or working six days a week.
But then something awesome happens. You pay off a debt, a credit card for example that kept eating your hard earned cash in interest payments. It's gone now though, for good. You've already cut up the card and now you can call the bank and cancel it. Right now you're feeling pretty darn good and are looking forward to bangers and mash on Tuesday because you know it's working,you can see it and you've now got one less debt that needs paying off.
You can see that if you are willing to keep at it, if you can stay strict with yourself then in just a few short years you can cut out the second job, change Tuesday nights to steak night instead of sausages and not have to worry about debt...EVER!
According to Mr Ramsey the average debt can be paid off within 18 - 21 months. Obviously your own personal time will be based on the size of your debt and the level of your commitment.
Some families go completely vegetarian, cutting out meat from their diet, to save the extra money on groceries. Don't worry if you don't feel THAT committed. Neither The Husband or myself are big fans of beans and lentils so we are keeping meat in our diets.
There are many other things though that you can do to make it so you have more money to go towards your debt snowball.
if you smoke, quit! If you go to a gym, quit! Both of these are money guzzlers and not needed. Smoking is not good for you and a run around the block, a workout at the local park or finding items at home to use in your exercise regime will save you hundreds.
It all comes down to what you are willing to do but on average you can be debt free with in 21 months.
I mentioned in my last post that the loan we took out for our recent holiday was on a seven year contract. On top of that loan we had two credit cards. With this plan we will be debt free by February 2017. So it will take us 30 months or two and a half years.
A bit longer than the average but still so much better than seven years. Oh and I say we 'had' two credit cards because when we started our journey we did, we paid off the smallest of the two just this week and it felt fantastic!
We are a one income family with two children under five and supporting an elderly parent. We also have one cat, one dog, and two goldfish.
It can be done you just have to persevere. Right now The Husband is working six days a week, it's hard with two young kids, but each time I get stressed I think about what 2017 will mean for us. Two years instead of seven, five years closer to buying our own home!
You can do it!
Skye
- Posted using BlogPress from my iPad
Tuesday, August 12, 2014
A Little Something On The Side.
There are two things I should discuss at this point.
One is budgeting and the other is giving.
We'll start with giving as it is quick and simple.
Dave Ramsey says in his Total Money Makeover to budget in money that we give, about ten percent.
I am not against giving to charities what I am against is charities making you feel like your contribution is not big enough.
We are far from being well off. We are on one income and we have debt. If we gave ten percent of our income to charity we would not be on track to getting out of debt. That may sound selfish to some but I'm putting my family first and I honestly don't have an issue with that. We put coins in the Guide Dog Societies collection dog each week when we do groceries, the kids know where that money is going and how those dogs help. Apart from random donations on behalf of loved ones who have passed away that is the only giving we do.
When we are debt free we will choose how much and to who we give more of our income too.
My priority is getting out of debt so we don't end up being the ones who need charity. When we are in a position to help others financially we will until then we will teach our kids about volunteering.
So basically to me it's a personal choice. If it's important to you to give then do so, if getting your own family stable first is important then find other ways to contribute to society.
Now the budget.
Each week or month depending on your pay cycle you need to have written down - or typed, just have it in words - exactly where every single dollar is going.
When you get paid visit an ATM and take out the cash. Find envelopes or jars or put some of your odd socks to use, label each one and put the cash into them.
Grocery money, clothing money, entertainment money...each one has a separate envelope.
The reason for the envelopes is to help you budget better each month and to encourage you to stop using plastic. Even if it's our savings account when you pay with card you buy more.
If you run out of grocery money and need more food you'll know to budget more for food and groceries next time. If your entertainment envelope is over flowing you'll know you put too much in that category.
It is also very important to have 'spending money' for you and your partner. You are being strict but you still need some fun. Even if it's only twenty dollars each a week/fortnight make sure you each have money to do with what you please.
All work lunches, snacks and transportation costs need to be budgeted into another area. Just because one partner may leave the house for work does not entitle them to more spending money. If you both work outside the home this should be easier.
Below are some links to resources on budgeting and one is to Dave Ramseys web page. There is a heap of useful information there and you can sign up for free newsletters.
http://www.daveramsey.com/category/tools/
https://www.moneysmart.gov.au/managing-your-money/budgeting
http://www.mybudget.com.au/what-can-we-do-for-you/personal-budgeting/
See you at step two next week.
Skye
- Posted using BlogPress from my iPad
One is budgeting and the other is giving.
We'll start with giving as it is quick and simple.
Dave Ramsey says in his Total Money Makeover to budget in money that we give, about ten percent.
I am not against giving to charities what I am against is charities making you feel like your contribution is not big enough.
We are far from being well off. We are on one income and we have debt. If we gave ten percent of our income to charity we would not be on track to getting out of debt. That may sound selfish to some but I'm putting my family first and I honestly don't have an issue with that. We put coins in the Guide Dog Societies collection dog each week when we do groceries, the kids know where that money is going and how those dogs help. Apart from random donations on behalf of loved ones who have passed away that is the only giving we do.
When we are debt free we will choose how much and to who we give more of our income too.
My priority is getting out of debt so we don't end up being the ones who need charity. When we are in a position to help others financially we will until then we will teach our kids about volunteering.
So basically to me it's a personal choice. If it's important to you to give then do so, if getting your own family stable first is important then find other ways to contribute to society.
Now the budget.
Each week or month depending on your pay cycle you need to have written down - or typed, just have it in words - exactly where every single dollar is going.
When you get paid visit an ATM and take out the cash. Find envelopes or jars or put some of your odd socks to use, label each one and put the cash into them.
Grocery money, clothing money, entertainment money...each one has a separate envelope.
The reason for the envelopes is to help you budget better each month and to encourage you to stop using plastic. Even if it's our savings account when you pay with card you buy more.
If you run out of grocery money and need more food you'll know to budget more for food and groceries next time. If your entertainment envelope is over flowing you'll know you put too much in that category.
It is also very important to have 'spending money' for you and your partner. You are being strict but you still need some fun. Even if it's only twenty dollars each a week/fortnight make sure you each have money to do with what you please.
All work lunches, snacks and transportation costs need to be budgeted into another area. Just because one partner may leave the house for work does not entitle them to more spending money. If you both work outside the home this should be easier.
Below are some links to resources on budgeting and one is to Dave Ramseys web page. There is a heap of useful information there and you can sign up for free newsletters.
http://www.daveramsey.com/category/tools/
https://www.moneysmart.gov.au/managing-your-money/budgeting
http://www.mybudget.com.au/what-can-we-do-for-you/personal-budgeting/
See you at step two next week.
Skye
- Posted using BlogPress from my iPad
Monday, August 4, 2014
Not A Twelve Step Program...
Dave Ramseys Total Money Makeover isn't a 12 step program to financial freedom...there's actually only seven steps involved.
The most important thing to remember if you take on The Total Money Makeover is to do the steps in order. No skipping ahead to a step that sounds more up your alley. If you skip a step you won't be helping yourself to get out of debt and most importantly STAY out of debt once there.
You need to remind yourself that the aim is to not only pay off the debt you have but to never get any debt again....EVER!
If you are committed to being debt free, are Gazelle intense about paying it all off and never being in that position again then sticking to the steps is what's going to get you there.
Before we get started one point that isn't an official step but is important is cutting up your credit cards. Don't wait until they are paid off do it NOW!
You need to look yourself in the eye and declare "I will never borrow again!" If you are committed to getting debt free you've basically done this so now is the time to test your resolve. Pick up a pair of scissors and pull your credit card out from it's snug little bed in your purse. Don't hesitate, snip it to pieces and smile like a mad man while you do. Today is your first day on the road to being debt free.
Now comes the official step one, prepare yourself because it may cause you some pain. Though if you're committed it won't really seem painful if you're thinking of what it's leading too.
Step one is 'Save $1000 as fast as you can'
The painful bit comes in to effect if you truly don't see anywhere else in your budget to pull money from.
Pay minimum monthly repayments, live on beans on toast, stop smoking, quit buying soda...any little extras you can cut to get a few more dollars from your budget cut out now.
If you have done this and $1000 is still far from happening sell something! Keep family heirlooms sell the rest!
You've committed to never borrowing again so you need money, cash, set aside in an emergency fund because we know Murphy likes to screw with us when we are at our lowest. This $1000 will be what you use when the electricity bill is higher than normal, when you blow a tire or the kids basketball goes through a window. You use the cash in emergencies only, it's not to be touched for gifts of ANY kind.
In case you missed it the painful bit about this step was selling your possessions. If you find this too difficult then you're not committed to being debt free and should give up now. Without full Gazelle intensity you'll never make it. If you have cut out as much as you can from your monthly spending and still can't find enough to meet the $1000 emergency fund then you need to get a second job or sell something you own.
You can't move on to step two until you've completed step one and you really want to get to step two, it's where all the fun starts.
Sell the Xbox, have a garage sale, take the treadmill to cash converters. Do what you need to to build up that $1000 as fast as possible. Don't dawdle on it. You want to meet this goal so you feel a sense of accomplishment. Once you've completed step one you'll be energised to get into step two.
As you go through the steps chances are you'll need that emergency fund for something - remember gifts are not emergencies - so each time you use your emergency fund you stop the step you are on and go back to step one until your emergency fund is once against at $1000.
Don't forget what I said in my last post, ANYONE can do this plan but ONLY if you are committed. It doesn't matter what your income is if you are committed and willing to sell sports equipment, video games, old clothes, DVDs etc... or get a second job, YOU CAN GET STARTED ON THIS JOURNEY. The only person holding you back is you!
Next post I'll get into step two, this is the one that gets us where we want to be, and I'll cross my fingers some of you have looked into and are on your way to completing step one.
Skye
- Posted using BlogPress from my iPad
The most important thing to remember if you take on The Total Money Makeover is to do the steps in order. No skipping ahead to a step that sounds more up your alley. If you skip a step you won't be helping yourself to get out of debt and most importantly STAY out of debt once there.
You need to remind yourself that the aim is to not only pay off the debt you have but to never get any debt again....EVER!
If you are committed to being debt free, are Gazelle intense about paying it all off and never being in that position again then sticking to the steps is what's going to get you there.
Before we get started one point that isn't an official step but is important is cutting up your credit cards. Don't wait until they are paid off do it NOW!
You need to look yourself in the eye and declare "I will never borrow again!" If you are committed to getting debt free you've basically done this so now is the time to test your resolve. Pick up a pair of scissors and pull your credit card out from it's snug little bed in your purse. Don't hesitate, snip it to pieces and smile like a mad man while you do. Today is your first day on the road to being debt free.
Now comes the official step one, prepare yourself because it may cause you some pain. Though if you're committed it won't really seem painful if you're thinking of what it's leading too.
Step one is 'Save $1000 as fast as you can'
The painful bit comes in to effect if you truly don't see anywhere else in your budget to pull money from.
Pay minimum monthly repayments, live on beans on toast, stop smoking, quit buying soda...any little extras you can cut to get a few more dollars from your budget cut out now.
If you have done this and $1000 is still far from happening sell something! Keep family heirlooms sell the rest!
You've committed to never borrowing again so you need money, cash, set aside in an emergency fund because we know Murphy likes to screw with us when we are at our lowest. This $1000 will be what you use when the electricity bill is higher than normal, when you blow a tire or the kids basketball goes through a window. You use the cash in emergencies only, it's not to be touched for gifts of ANY kind.
In case you missed it the painful bit about this step was selling your possessions. If you find this too difficult then you're not committed to being debt free and should give up now. Without full Gazelle intensity you'll never make it. If you have cut out as much as you can from your monthly spending and still can't find enough to meet the $1000 emergency fund then you need to get a second job or sell something you own.
You can't move on to step two until you've completed step one and you really want to get to step two, it's where all the fun starts.
Sell the Xbox, have a garage sale, take the treadmill to cash converters. Do what you need to to build up that $1000 as fast as possible. Don't dawdle on it. You want to meet this goal so you feel a sense of accomplishment. Once you've completed step one you'll be energised to get into step two.
As you go through the steps chances are you'll need that emergency fund for something - remember gifts are not emergencies - so each time you use your emergency fund you stop the step you are on and go back to step one until your emergency fund is once against at $1000.
Don't forget what I said in my last post, ANYONE can do this plan but ONLY if you are committed. It doesn't matter what your income is if you are committed and willing to sell sports equipment, video games, old clothes, DVDs etc... or get a second job, YOU CAN GET STARTED ON THIS JOURNEY. The only person holding you back is you!
Next post I'll get into step two, this is the one that gets us where we want to be, and I'll cross my fingers some of you have looked into and are on your way to completing step one.
Skye
- Posted using BlogPress from my iPad
Subscribe to:
Posts (Atom)