Monday Monday ....

Today I am off to do the shopping. Not just any shopping, but my 'extreme shopping'. Frequent readers will know that I take my grocery shopping pretty seriously! LOL http://avisionsplendid.blogspot.com/2007/08/extreme-shopping.html

The good thing about shopping today is that I won't have the children with me, so there's a dramatic saving straight away ! I will also go to ALDI which is about 40 minutes away. I go with a friend and we share the petrol cost. It's also a nice day out to go to a place that has shops that we don't normally see.

I am looking forward to getting my menu planning sorted out, my budget money up to date and re-stocking my stockpile. We let it run down over the summer because we were going to be away so much and I wasn't working, so we used up much of our stores.

I am almost finished updating the sections in my planner http://avisionsplendid.blogspot.com/2008/01/new-planner.html For those of you that asked about it, I will update you on the inside workings of it once I have completed it.

Savings or " Not Spendings"

We hear all the time about how much money we can save. We see it in shops - save $15, save 30% or we read about people cutting $25 a week off their groceries.

But are these really savings ? and if they are where does the money go ? I am quickly realising that most so called ' savings' should really be called ' not spending', in that unless you were actually intending to spend, for example, $100 on an item and you only had to spend $80 and invested the $20 - then that is a true 'saving'.

Lets look at it this way.

When doing our budgets we go through and 'reduce' our outgoings - $5 a month here, $2 a month there etc etc. - adding up to $400 saving a month and a whopping $5000 saving a year. But do we actually invest that saving and earn interest off it and add to it and make it grow ? Or is it simply money that we could have spent but didn't!

I am going to make sure that I 'scoop off' all the little 'savings' I find. For example, when I budget $150 for the weekly groceries but only spend $125 I will put some aside for weeks when I need to spend more to stock up and I will scoop off some and put in my 'never to be touched' savings account. I think in this category a 50/50 split with the leftovers will be good.

Are you frugal, do you work hard to save money .... do you channel that money into savings or into debt reduction ? Post your ideas here.

$21 challenge

I am currently preparing to do the $21 challenge at Simple Savings ( see my link at the right hand side).

 The reason that I am preparing this is that I have to really think about how I will tackle it.

The idea is to be able to feed your family for a week for $21. You don't have to do this all the time, but doing it from time to time means that once a month or so you have a considerable chunk of your budget not spent.

You are allowed to use things from the pantry that you already have, so the $21 doesn't have to buy every little ingredient.

Is anyone keen to have a go or at least swap some recipe ideas ? There are two adults and two children aged 6 and 9 in my family.

STOP THINK DO - Part Three

Develop a Plan and Organise a System For Paying Your Bills

If you have bills arriving in the mail that you didn't know were coming or you suddenly can't afford to pay for something else because you have to pay this bill, you are allowing your bills to control YOU, instead of you controlling them.

To prevent this, you must have a plan and you must work your plan into a system.
Firstly, list your big expenses throughout the year. These may include electricity, water, school fees, registrations, insurances etc. If you are unsure when these bills fall, then mark them on a summary sheet which is divided into 12 boxes, one for each month, as they come in through the year. Knowing what is on your horizon will enable you to plan for the larger expenses rather than dreading them when the bill arrives in the mail.

To control the bills I have a system whereby I tally up every bill that I expect to come in throughout the year.

 I look back through old calendars and bank statements to get an accurate list. I then add the total of all the bills for the year. After I get up off the floor and recover from the shock I divide this amount by 52 or 26 if you work on a fortnightly budget and then know that this is the amount that I have to put aside.

My version of "put aside" is to transfer it into an account that is only for bills. I don't touch this money, except for bills. Depending on how much control you need over your finances, you may choose to have a plastic bag for each bill, whereby you put $20 a week into the electricity bill bag etc. Some people choose to do a bpay electronic transfer to each company so by the time the bill comes in, the amount is in credit or close to zero.

The choice is yours.

The only rule is that it has to be "a system" that is, something that is not too complicated and works for you. If you are the type of person that simply can't have cash on hand because you are impulsive then don't choose the method where you hang onto the cash. You would be better of paying each company a small amount each fortnight.

When a bill comes in I write the due date on the calendar and the amount. I then have an "unpaid bills" clip that stand on my desk. One of my jobs on Mondays is to look at my budget and pay any bills. I pay the ones that are due in the upcoming week. I also write a list of bills that I have paid so I can see at a glance how much variance in, for example, mobile bills over the past few months.

As you know from my previous posts we work on a cash only basis for our day to day expenses and for our savings. See my previous post for how I actually do this.
http://avisionsplendid.blogspot.com/2007/07/working-with-cash-budget.html

To take away financial stress you have to be in control. Otherwise your money management is like a giant wave that keeps knocking you down every time you try to stand up. Removing financial stress will allow you to concentrate on more important things, like building quality family relationships and having a more peaceful, simplified family life.

Let me know how you are going via email or comments. If you have any helpful hints on how you reduce financial stress in your family, please let us all know.