Sorry to have been MIA so long, but I had a bad fall and am slowly recovering. Medical costs have been quite high, and I had to cut back work hours, but I am happy to report that my 2010 goals are progressing nicely. I now have saved up $5,000 for my FFEF, am putting aside 8% of my pay into Kiwisaver, and am working on the travel to Britain fund.
Viewing the 'Savings' Category
This month's frugality has worked out well - I had a surplus of nz$500. I put $100 in the house maintenance account and $400 in the EF - and spent $2 on a packet of cookies to celebrate.
This morning I switched to a new package from my phone company. By combing my phone and ISP in the same deal I get twice as much Broadband, with no overage charges, and cheap calling rates to NZ and Australia any time of the day or night. Plus I'll be saving nz$1.30 a month. I decided to get rid of the call waiting feature too as I never use it - I think it's rude to ask someone to hang on while you talk to someone else - so that is another .50 cents a month saved. Yippee, 22.60 a year.
The weather has been so warm the last few days I didn't need to have the heater on. Yay for coming summer and lower power bills.
Piled higher and deeper. In cash, that is. This month I had 3 biweekly paydays and 5 weekly paydays, plus tax refund, so nz$1563.91 going into the a/c. That seems like sooo much money after what I've been living on. I now have $1482 altogether in my various sinking fund categories.
Clothes -20 (how did that happen?)
I have a trip to the dentist coming up soon, otherwise I'll just keep piling the money up.
I started the week with nz40.30 in my wallet. At the end of this week I still have $16. I didn't carry my ATM card with me - if I think I've got lots in checking, I'm too tempted to use it. But cash is great; you can see it disappearing.
So another $10 for the EF, and the rest in Christmas savings.
I have set up a monthly payment of nz$100 to be transferred to Bonus Bonds. It came out today. Otherwise nothing to report.
All I spent today was nz1.20 on chips as a treat for myself for being good this week. I still have $11.30 in my wallet, so will put $10 in the EF and the rest for Christmas.
I will probably be the first to bid farewell to the old year and see in the new, so time to sum up the year's achievements and consider what lies ahead.
Bill payer 385
House repairs fund 185
Online a/c 317
Emergency fund 3,400
Difference from 31 Dec 06 - saved 779. In addition I paid 1040 into retirement savings. So from a piddling income of just under 12,000 I saved 15%. I am quite chuffed with myself.
I didn't reach my goal to have 5,000 saved in the EF but that was because I had an emergency! Despite the difficult year, things have improved overall. Next year I will be wanting more liquid funds to cover expenses of selling and buying a new home and shifting. I also have 5,000 in the Credit Union for a trip to Britain. It looks like it will be a year of blackbelt tightwadding and one month of living it up in July. I am going to blog more often to keep me on track, maybe start listing my daily expenses. Today was a no spend day apart from .20 donated to a charity box.
Kiwisaver is the name of the new retirement savings scheme launched by the Govt on the 1st of this month. I have been checking out info, and it seems worth joining. You can contribute up to 8% of your earnings, with up to 4% employer match, plus an initial boost of $1000 from the govt, and tax credits of up to $1040. Slightly more complex than letting it grow tax free, which would be my preference, but nothing is perfect in this world. Of course it would be perfect if I ruled it!!!
There is a range of approved schemes you can choose from; I picked one up from my bank this morning, which offers 5 funds, from conservative (mainly fixed interest investments) to aggressive growth (nearly 100% shares). The management fees are reasonable, around 1% in total, and investors who itemise claims can get reimbursement. I already have some retirement savings in a private scheme which is a growth fund, but now I'm in -erm, "late youth" - maybe I should look at starting a balanced fund. You can get an age appropriate scheme which will transfer you based on your expected retirement date, but there is a transfer fee. Still got to consider whether saving that is penny wise, dollar foolish. Also, all I have heard so far seems to be based on someone working a regular job for a single employer. Don't know where that leaves self-employed, freelancers and temps - much of my past working life was spent on short term projects, which is why I had to be careful to put a portion of all I earned in a private scheme.
It amazes me how many people seem to be so resistant to putting anything into Kiwisaver. There seems to be a feeling of "this is just another ploy cooked up by the govt and the big money interests to rip us off." Well, maybe it's not so generous as people expected, but if you put nothing into it, then you'll find what you get from the govt at retirement isn't very generous either - and you will have ripped yourself off. It is mostly the lower earning people who argue this way, the higher earning people are quite keen to join, and if they object, it's becuase they have other ways of investing their money, or they project earlier retiremnt and don't want to tie up their savings until they're 65.
The other big argument, of course, is I can't afford it. I have 2 friends who smoke; one is earning a low income but is doing his level best to quit so he can save money. The other argues that the pleasure she gets from it is worth "only" $18 a week, and anyway she has a high earning husband who she's sure will look after their retirement. That $18 a week invested in Kiwisaver would come to around $100,000 by retirement. Meanwhile she continues to buy clothes and lunch out whenever she wants - then complains she "has" to work at a cr@p parttime job in order to support her family. Her lack of logic drives me crazy, but maybe I'm a smallminded person - was it Emerson who said consistency is a hobgoblin of little minds?
In the meantime I'll be a patriotic Kiwi - so glad our govt isn't telling us we should spend more for the good of the country.
I haven't mentioned I started the new job this week. They suggested I come in from 2-6, but I found I could complete the work in only 3 hours. Since noone is around to supervise me, I could be dishonest and pad the timesheet. Of course I don't do that, but it means I am earning less money.
I also found out that I am not getting paid weekly on this contract, but in a lump sum at the end. So it is a good job I was able to put aside so much money last month. I can't imagine how I would cope if I lived paycheck to paycheck.
Thanks to the kind comments in response to my previous post, and - ALSO -
I've been totting up last month's spending.
Property taxes 90.21
Internet and computer 27.95
Entertainment and Dining out 28.20
House and garden maintenance 25.54
Xmas gifts 39.44
Bus fares 10.00
Whee! I saved over 50% of my income last month. Maybe I don't need to cut back as much as I thought. I also reflect that much of what I used my savings for was family emergency and house repairs - exactly what it was there for. Plus I didn't touch my retirement savings or go into debt. Last year was tough, but I coped, and I think this year will be a lot better.
Anyone want to see one of those reality shows where people from different walks of life swap places? I'm volunteering to trade with a politician or a Treasury economist for a week
Last week I tripped over the phone cord and had a bad fall - my arm was so sore one of my coworkers insisted on driving me to A&E to get it xrayed. Fortunately there was no fracture, but I have a massive bruise on my elbow. However I can still use the arm. I am so glad we have a free hospital system in New Zealand.
End of the month is all good news
I finished knitting a beanie for ds and posted it on time to get cheaper rates.
Income for Nov was the highest it has been in a looong time; $1353.20, and i spent only $668.23. Woohoo saved 50% of my income!
AND the boss asked me if I would be willing to work 30 hours a week until Christmas. My doctor is agreeable to me giving it a trial, so who knows? Maybe next year I will be able to get back to full time work.
Today I paid $85 into my Emergency savings and am slowly rebuilding it. I actually spent less money this month than last tho I wasn't particularly trying to save. $nz584.26, total savings this month $nz187.72.
Back in May my ISP was down for a couple days in some parts of the country. It didn't affect me, but I have just received a $3.72 rebate. Today I met with an old college friend who is going thru a difficult time and took her to the movies to get her mind off her troubles. The quickest way to feel rich is to be generous to someone worse off than you are. I was rewarded at the box office because it turned out to be a discount day.
We are nearing the end of winter Down Under and today is a lovely day with birds singing and crocuses blooming. I have not had the heater on all day and got the laundry dry on the line.
My change jar is a clay pot in the shape of two begging hands (Sorry no photo) I got it from the church for the mission appeal, but liked it so much I used it myself once the appeal was ended. It holds about $30 in change, then I pay it into the bank.
This month the change jar passed a minor milestone: since the beginning of the year over $100 in found money has passed through its eager little hands - $NZ114.15 to be precise. I gave 10% of that to my church. Maybe I will find $200 this year if the second half is as good as the first.
Adding up all my various accounts for the end of the month
Bill payer 617
House repairs 406
Bonus Bonds 2440
which comes to a total of $NZ5547. There is something very satisfying about passing the 5000 mark.
I have not totalled all the interest received this month, but as interest rates are quite high in NZ at the moment, I am earning 7.4% on the online emergency savings. This month I got $NZ3.03 after tax.
This month there were 5 paydays, which meant I was able to save $600. So I loosened the purse strings a little and had a chai latte with my friend, $NZ3.50. But I did pass on the decadent chocolate slice.
I now have $2,300 in Bonds. This is equivalent to 3 months sickness benefits. I aim to keep saving until I have a years income saved up.
A few little bits of income have come my way in the last 2 weeks. I got a tax refund of $43.83. I got reimbursed by my Toastmasters Club $30 for an ad I'd placed in the newspaper months ago and practically forgotten about. I knitted a scarf for a friend and she paid me $10.
I also got the statement for my retirement account, and it grew by $2,700 last year. I'm now looking for a little part time job, so I can begin contributing again. I can earn up to $80 a week without it affecting my benefit.
I went out shopping for the first time in a while today and had a great find in my favorite thrift store. 5 cones of yarn for a $1 each, 4 of Shetland wool and one of laceweight. It will keep me happily occupied for a long time. They also had trousers on sale at 2 for the price of 1. I will need to get some more as I have lost weight.
Hmm, something has gone amiss with my tracking. According to the added totals in my littel pocket book notepad:
But when I checked the difference between last month's bank balances and this, I came up with an increase of $346.05. Oh, well it's more money for me.
The banks have sent me statements of interest earned during the year. $70.27 for the main account, and $19.34 for the smaller one. Alas, I have to pay interest at 19.5 cents in the dollar. Don't you think if the govt was really serious about wanting us to save for our retirement, they'd make all savings tax free?
Time to do my adding up at the end of the month.
Total income $935.81
Property taxes 88.40
House insurance 45.72
Phone 65.80 (includes $20 for cellphone)
Eating out 4.00
Household supplies 5.50
Total saved for month 334.61.
Obviously that isn't all going into investment savings. Some is kept in contingency and holiday funds. Nevertheless, a good month (of course it was a short one, so I should have spent less)
My weekly income at the moment is NZ$173.29. I have my 22 yo son living with me, who pays me $50 each week in rent.(He buys his own food) I intend to save as much of this as possible, and put it in Govt bonds. Then I can say I'm living off the Govt without shame.
The first thing to get rid of is the car, as it is quite old and getting to the stage where it costs more to repair than it's worth. I also have difficulty concentrating on driving on my current meds, so the other road users will thank me. I am eligible for a discount bus pass, and my dr has recommended that I walk as much as possible, so that will be a saving.
My basic living expenses are around $320 a month for rates(property taxes), power, phone, house and contents insurance and phone and Internet connection. I have a Community Services Card which gives me a subsidy on prescriptions. At the moment I am eating a vegetarian diet with absolutely no sugar or any manufactured snacks. I don't eat out much apart from church potlucks, and I don't drink alcohol. It sounds very austere, but I have been to India and since coming back I have lived very simply. I know how to count my blessings.
At the moment I am saving $10 a week for holidays (mainly church camps and retreats, or visting family) I also save $10 a week into what Mary Hunt calls a "Freedom Fund". At the moment I have $980 in it. I also need to look at putting money aside in case I have to make changes to my house or move to a more disability friendly house. I would need to be practically destitue and in a wheelchair before I get any financial help for that. I save a further $25 a month into an emergency fund, which currently stands at $512 in an online bank.
All in all, pretty good. I am so glad I am not renting in our current housing market, and I have the skills to cope. I used to do volunteer work as a budget advisor, and I learned a lot from the mistakes I saw other people making.
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