Burning Desire For FIRE

Financially Independent, Retired Early(ish) at 57.

Category: Frugality (Page 8 of 8)

What has my second-gen FIRE child learned about money?

December 8, 2018 / / 22 Comments

 

In the personal finance world, there’s a lot of blog posts written about teaching children about money. I’ve done it myself – the post I wrote that ended up winning the first Rockstar Rumble was about teaching my kids about compound interest. However, a huge proportion of these posts are written by parents with very young children. I’m at the other end of the journey, with adult kids moving out into the world.

I discovered the FIRE path about 5 years ago, so a lot of my boys’ money training has been observing the day-to-day decisions that I’ve made in the previous years, as well as observing the decisions of other family and friends around them.  I didn’t have the information about investing and compounding that I do now, so for most of their lives I wasn’t actively talking to them about this. Their father has been a small business owner for most of their lives, so they’d work in his shop on their access weekends with him and see life from that angle.

A year ago, on the other blog, I wrote about Evan22 moving out of home into Res at Uni in a post entitled: Reduce Your Bills By Evicting One of your Kids!

As anyone who has ever lived on campus knows, choosing to live there is hellishly expensive. Back when my boy was Evan21, he decided to live on campus for a year to get to know everyone and then work out who he wanted to share a house with for the next 2 years of his course. He paid for this himself. His decision to live in Res worked out really well. As he said on the way up to Ballarat, “All the people who moved into houses at the start of the year are now all moving away from the people they started with and moving into different places with their friends!”

Here’s The Playboy Mansion. Evan22 will be living here with 3 girls. They have the bedrooms in the house, while he has the sleepout out the back. He pays the most for his space, at $150/week.

He’s a full-time student over the age of 22, plus he’s living away from home. This means that he can pull in a Centrelink payment of around $580/fortnight. He’s taking out a HELP loan to pay for his course, which is around $6,800/year. I know that many people, particularly in the US, consider it almost mandatory to pay for some or all of their kids’ college/university fees, but I don’t.

I told them all that I was responsible for seeing them through high school. If they choose to go to tertiary education, (the word ‘choose’ should have been in quotation marks because they were left in no doubt that the only choice about that was which course they should do!)… anyway, they could live with me without paying board. They pay for their own books and fees, but their living expenses are nil.

My reasoning is this – I think a better financial gift to my children is the gift of their mother being financially independent throughout her whole life. I don’t want to be in my 80’s and having to go to the boys for a handout every time the electricity bill comes in. They’ll have their own families to support and their own lives to live. I can’t finance their educations and adequately provide for my own retirement – I am but one woman. So they have to take responsibility for their own decisions from here on out.

So how has Evan22, being the youngest of my children, handled his finances after a lifetime of living with Frogdancer Jones? I haven’t directly asked him about this – maybe an interview post in the future might be interesting to get his perspective? – but here’s what I’ve observed.

But first, a little background to put things in context:

 

He was only 11 months old when I left my ex-husband, so he, as one of the younger 3 boys, grew up without any memory of when there were 2 parents in the house. For the next 4 years of his life, I was a stay-at-home Mum, waiting for him to grow up and get to school so that I could go out and work. We existed on what was called back then the ‘Sole Parents’ Pension’ of around 18K/year, plus intermittent child support when the Child Support agency would catch up with my ex.

With 4 children, going back to work wasn’t a financial option. The daycare fees would have wiped out my wage. So the boys lived in an ultra-frugal house for years. My priority was security for the boys, so the mortgage, food and bills were always paid. Then any extras would come out of what was left.

So what has Evan22 done with all of this?

He’s actually done pretty darned well so far. When he finished secondary school he was adamant that he didn’t want to go on to further education. He took a gap year, where he worked part-time in a fruit shop around the corner and dabbled on various writing and film projects. He couldn’t get any Centrelink allowances because at his age, they take his parents’ income into consideration and I earn too much.

Then the gap year turned into 2… then 3. About 18 months after he finished school, I moved out of the house we were living in and went to live in The Best House in Melbourne, while Evan20 stayed behind in the old place. He got some roommates in and they all paid rent.

He was never late in the rent. He worked and paid his own way. Sure, the garden looked like the place was haunted and they weren’t the cleanest tenants a landlord ever had, but he was supporting himself and hey- the house was going to be knocked down anyway!

In his third gap year, he left the fruit shop and took an office job with a couple of his high school friends. Unbeknownst to me, he’d already decided that he wanted to do an acting course. Unfortunately, that realisation hit him AFTER auditions for the following year were over. So he decided to get a job that actually paid fairly decent money and start to save.

Most acting courses worth their salt are either interstate or in the country. There was one – at the Vic College of the Arts – that if he got in, he could live at home and take the train in each morning. But he knew he’d better not bank on that one. He saved up around 15K over that year he worked in the office job, quietly salting it away for what may come in the next year.

Meanwhile, the house was sold and he moved back in with us. He still kept going to work, saving and still having fun. Towards the end of that year, (2017), he casually said, “Hey Mum, can you help me with some audition pieces? I’m going to try for Acting for next year.”

When he was accepted into a really terrific course in rural Victoria, I was worried about the expense of housing him. But, as you already know, he already had that covered. He was determined not to ask me for money for it, so he paid for his first year of accommodation. Towards the end of that year, he had a birthday and he knew the mature-aged student allowance from Centrelink would kick in, enabling him to pay rent for the next 2 years. He’d quietly worked it all out and then took the steps to make sure it would all come together.

All of my children have grown up to be very debt-averse. None of them have credit cards and the only person they borrow money from is The Bank of Mum if their car blows up or something. (They appreciate the interest-free component. And they always pay me back.) But Evan22 wasn’t comfortable borrowing 5 figures from me, so he worked out a way to cover it himself. I’m incredibly proud of him for that. I think it shows maturity beyond his years.

But what about the rest of his expences? Is he incredibly frugal, spending money only on essentials?

Well, if you consider buying 5 copies of the same vinyl album of his favourite band because it came in 5 different colours frugal… then yes! He seems to go out to breakfast a lot, so I’d say there’s plenty of smashed avocado in his life. When he drinks it’s not beer or wine, but vodka and whiskey. He’s a vegetarian, so his groceries are probably less than if he was a meat eater, though having said that, have you seen the cost of chia seeds lately???

He spends very little on clothes. They’re just not that important to him. I think he’s learned by living with me that it’s smarter to spend on the things that HE values, not what society/his peers/his mother tell him to spend his money on. He follows his own heart.

When we finished moving in I took him out to lunch. He’s an independent guy – I asked if he wanted to swing by the supermarket on the way back to The Playboy Mansion to stock up his new kitchen. I was paying, of course.

“No thanks, Mum, ” he said. “I’ve got plenty of food left over from Res.”

In the whole year he’s been living up there, he hasn’t put a hand out for money once. Not once. I haven’t offered, because I was curious to see how it would pan out. I’m very proud of how he’s learned to organise his money and pay his way.

On the way up to Ballarat, we went via IKEA, where I bought him a Queen-sized bed with all the trimmings, plus a few other odds and ends that he needed. He thinks that the extra things are coming out of his Christmas money. (I give every boy up to the age of 25 a $300 voucher for Christmas. They use it for clothes, usually.) He’ll be expecting a voucher for about $50.

But he’ll be getting the full $300. I think he’s earned it.

I’ve said it before, but I’m very proud and impressed by how well Evan22 has stepped out into the world and has started to navigate himself with his finances. He’s clearly observed and internalised the “stay out of debt’ and ‘make sure there’s more money than month’ rules that I’ve lived my life by.

The next step is to teach him about compounding and investing. Considering that he’s moving into a notoriously unstable field of work, he’ll need his money to be working hard for him. However, judging by how he’s travelled so far, I think he’ll be able to listen and learn.

So far anyway, he’s behaving with money pretty much as you’d want a second-generation FIRE kid to be. Ok, so he’s not doing an engineering degree or living at home and biking to the local university to save money, but all in all, his attitude towards his finances seems to have a solid bedrock upon which to build.

Anyway, this is how a second-gen FIRE kid is behaving in his early 20’s. He learned frugality and delayed gratification at my feet, but I didn’t start learning about investing, compounding and FIRE until he was in his late teens. Imagine what the children of younger FIRE parents will be absorbing as they grow?

The sky’s the limit…

 

8 gift ideas when you’re buying for a frugal person.

November 12, 2018 / / 14 Comments

Ok, I admit it. I’m a frugal person. I hate to waste money on fripperies, and I hate seeing my loved ones do the same. But that doesn’t mean that I don’t like Christmas presents!!

Christmas is my favourite time of the year. When my marriage broke up, back in the day, I split the holidays with my ex-husband. He had Easter (his family gives WAY more chocolate than mine does) and I had Christmas. I love the plotting and planning, the hiding away to wrap presents, the sneaky questions aimed at ferreting out just what someone would like to be given – I love it all.

But here’s the thing – we all want to minimise the presents that miss the mark with the recipient and we want to increase our chances of seeing a genuine smile on the face of someone you love when they see the present you bought them. Here are some gift ideas for that frugal someone in your life.

1. Buy things they’ll use every day.

My third son, Ryan23, is a student. He doesn’t have much money to spend, so when I was inconsiderate enough to have a birthday recently, he had to come up with the goods. Instead of buying something splashy and expensive, he came up with some brilliant little gifts. The first one is the soap that you see above. His friend has a small side-hustle making and selling soap. He remembered the days when I used to make our own soap, plus he knows me well. I shower every day. He bought two ‘cakes’ of soap for me.

I loved this gift! In fact, I loved it so much that I raced out and made some more soap of my own. It satisfies so many things – each morning I pick it up and smile because it makes me think of my son. It’s hand-crafted soap, which is so much better for the skin, so I feel pampered. It will get used up, instead of becoming clutter.

And – it was free!

2. Buy little luxuries that they’ll use that they wouldn’t buy for themselves.

My second son, David25, loves to think of gifts to spoil people. For my birthday, he hopped online and looked for “most popular lip gloss”. He also gave me a black evening bag, because I’ve bought season tickets to the Melbourne Theatre Company and he also gave me a luxurious cocoa butter body creme.

I don’t really use body lotion, but hey! Skin is skin, right? I looked at the ingredients and thought that they sounded like night moisturiser. So I started using it, thinking that if my skin flared up I’d go back to my usual moisturiser. Two months later the tube is nearly used up, my skin looks youthful and dewy and neither David25’s money or mine has been wasted. Again, it won’t cause clutter around the place and I get to use products that I would never have bought for myself. It’s special.

3. Craft/hobby supplies.

This is an area where you should probably enlist the recipient’s help, but it could be worth it. Nothing would be better than someone saying, “I know you like knitting/board games/quilting/woodwork… what could I buy you that you’d love to work with?”

Trust me – there’s always something that a frugal hobbyist has eyed off and said to themselves, “That looks so nice, but I’d better not buy it.” It could be a gorgeous little pair of scissors for snipping threads – a frugal person will look at it, love it but then say, “But I already have a serviceable pair of scissors for that. I don’t actually NEED them.”

It might be something that they can actually get their hands on, such as a skein of yarn hand-dyed in Peru that is as soft as butter and costs more than your beloved frugalist thinks they should pay for themselves. But as a gift? They’ll think of you and treasure each moment they knit and then wear the item.

If they don’t want to say anything, because they’re worried about you spending too much on them, that’s when vouchers become your friends. Again – use their frugality as a weapon to get them to treat themselves. They may not dream of spending $50 in one hit at the craft store, but when the money has already been spent? They’ll march into that store and make sure not to waste a single penny of YOUR money.

4. Go in partnership with a frugal craft person.

I just thought of this one, but it’d be THE BEST. I’m always knitting or quilting something for the boys. Years ago, back when Tom26 was Tom16, I said to him that I was going to make him a quilt. He insisted on going to Spotlight with me to choose the fabrics. It was the best afternoon! We wandered around, with him choosing the prints that he liked – golf, guitars, The Beatles, and others that I can’t remember. We had such a great time, then he took a keen interest in the design and hung over me when I had sewing days while I was putting it together.

Ten years later, it’s still on his bed. He loves it.

Why not ask the frugal craftist in your life to make something for you, then go shopping with them for whatever they need to make it with and you pay for it? That is the gift for them… and the gift for you is the actual thing that’s created. Your frugalist gets to have the fun of making it, which is what they enjoy, with the certainty that what they’re creating will be wanted and cherished. That’s a lovely feeling to have as you’re making something for someone else, believe me.

5. Buy or make them something edible.

Check on their likes and dislikes first – anyone giving me anything made with bananas wouldn’t like the dry retching that would go on after I unwrapped it!!

But an avid cook would probably like a couple of bottles of infused oil to play with, or some truffles or some home-made vanilla essence. Someone who’s a coffee drinker might like a couple of small bags of exotic coffee blends to try. Tea drinkers would love some gourmet tea blends and there are so many to choose from.

If you happen to be the good cook, then the whole world opens up for you. David25’s girlfriend, Izzy, brought around a plate of home-made chocolates as a gift from her mother for Christmas. I was mortified at first – I’d been out-Christmassed by a woman I hadn’t met yet! – but that feeling quickly passed as David25, Izzy and I settled in to watch a movie and eat the chocolates. They were delicious and made what would have been an ordinary occasion into something a bit special. Look, it’s nearly a year later and I haven’t forgotten them, (and just between you and me, I’m hoping that she does it again this year…)

6. Experiences make memorable gifts.

One of the best Christmas gifts I ever had was when I was still doing my side-hustle as a Thermomix Group Leader. Our branch manager took us out for Christmas and we did a Foodies walking tour around the laneways in Melbourne. I wouldn’t actually class myself as a ‘foodie’, but it was so much fun!

We were led to little bakeries, chocolate shops, an Indian café that looked like nothing from the outside but had the most delicious Indian food in Melbourne. We went to another place in Chinatown to sample the roast duck and we ended up in a tiny grocery store opposite the State Parliament that had a cheese cave in the basement and also sold the best ice cream I think I’ve ever tasted.

Would I – the self-proclaimed frugalist- ever take myself on a walking tour like this? Never in a million years. Do I still remember it to this day? Absolutely.

7. Look at their interests, then think a little outside the box.

My oldest son, Tom26, has done this for the last two Christmases. He knows I’m addicted to reading, and he’s always been one to put a lot of thought and care into his gift-giving. What he’s been doing is looking up which novels have won awards in the year gone by, then he buys a couple of them and gives them to me.

It’s such a great idea! I don’t tend to buy many books, because I’m such a quick reader that a novel usually lasts me a day or two, which adds up pretty quickly at $30 a pop. The popular books are usually always booked from the library, so with Tom26’s gifts, I’ve been able to read some fabulous books that I otherwise wouldn’t have gotten around to read for ages, if ever.

Look at your own frugalist and see how you might tweak this idea for their interests.

8. Use your creativity to solve a problem your frugalist has.

Ryan23 didn’t just give me soap for my birthday. He also solved a problem for me. See this chart with the real-life names artfully coloured in? It eliminated a problem in our household that was really bugging me.

I live with 2 adult children. We all have our own lives to lead and we’re in and out of the house all the time. It’s all good. But when dinnertime approaches and I don’t know how many I’m catering for, it makes me antsy. I don’t want to create a huge meal and have only myself there to eat it, or, what’s worse, when no one tells me they’re going to be home and then 2 seconds after I dish up a meal for myself, they bound through the door and start looking through the fridge. It’s annoying and really inefficient.

I think Ryan23 got sick of the texts I’d send at around 5 PM saying, “You home for dinner?” He made this chart out of things that were hanging around the place. The boys just click a bulldog clip onto the nights they’re going to be home for dinner. I come home and can see at a glance how many people are eating here and I can cook (or better yet, make one of them cook) for the correct amount of people. If there’s a last-minute change they text me.

I absolutely love it. It cost Ryan23 nothing to put it together – just a few minutes of his time. I’m now no longer harassing the boys about their plans and it makes our lives that little bit easier.

So there you have it! 8 ideas to chew over when buying for that difficult but loveable frugal person in your life. Practical gifts that won’t create needless clutter are the ones to be looking out for. If you tailor your gifts along these lines, your frugal loved one will SO appreciate the thought that went into your gift.

And they’ll definitely notice the thought. How do I know?  Because being frugal means being able to pay attention to details. They’ll love that you noticed the little things about them that others maybe haven’t.

And this will make for the very merriest of Christmases!

How I choose to spend my grocery money to get more bang for my buck..

November 2, 2018 / / 2 Comments

6 years ago in 2012, I wrote this post on my personal blog and I also posted it on the Simple Savings forum, where it has remained one of the forum favourites. Last night someone bumped it up again and I reread it. I thought that it was worth posting here on Frugal Friday, as there’s lots of actions I did then (and still do to this day) to keep my grocery bills down as low as possible. I can almost guarantee there’ll be something here that every one of you could adopt and use, even those of you without 4 teenagers, pets or chooks.

Keep in mind that any $$ values are 2012 costings. Also, the photo isn’t the most flattering, but it has something in the background that I’ve written about in the post. 🙂

***

I had a couple of people ask me how I kept my food spending down so low, considering I’m a single mother feeding 4 humungous boys (all taller than me so I must be doing something right!), 2 dogs, 2 cats and 6 chooks while spending $130/week. This figure includes cleaning products; things like toilet paper/baking paper/alfoil etc; the evil takeaways; things like fertilisers or snail bait if I happen to pick them up at the supermarket… in fact anything bought at the supermarket and animal produce store is included on the spreadsheet. It’s easier that way.

The bottom line about all of this is that I scrimp and scrape on the things that aren’t that important to me, so that I can spend/invest the money in things that ARE important to me. An integral way of doing that is to keep the grocery spending as low as possible. This is the one area of the household spending where there is room to move because so much of it is down to choices. Any money that I don’t have to put towards going down our necks can be put towards getting us closer to our goals. I find that an exciting challenge.

I will disclose at the outset that we get free bread from a bread shop. We get whatever they haven’t sold on Tuesdays, so we turn up with 2 or 3 laundry baskets and collect the bread, buns and pies that were unsold and we share them with a couple of families in the area (and I take donuts to work for staffroom 1.) I sometimes get a box or two of fruit and veggies from my ex-husband’s fruit shop when the boys come back from a weekend at his place. (This varies wildly as to how useful it is, depending on who packs it. Tom19 brings back 3 watermelon (whole), 5 bags of carrots and a couple of cantaloupes. The ex-husband packs things that aren’t selling and these things tend to go off quite quickly, while Evan15 packs things we really need such as potatoes and pumpkin… plus baking ingredients for gingerbread. Last time he included 3 packets of vanilla sugar, because he saw it mentioned in a thermomix recipe.) Long-term readers may remember the drama we had a couple of years ago with child support issues. That angst has simmered down, but I make it a point of honour not to waste a single THING we get from his shop! If all else fails then the worms or chooks eat from it, but nothing gets thrown away.

With the bread and the fruit shop things, we save a fair bit right there. I maximise the savings by feeding the chickens from the bread shop buns and pies first thing every morning, so the edge is taken from their appetites by the time I put the feed pellets out for them before I go to work. On Saturdays, if there’s still a fair amount of stale bread and buns left, I give the chooks a “pellet-free” day, where they get fed exclusively from the bread shop leavings. I wouldn’t do this every day, because they need their nutrients, but I figure once a week is acceptable. After all, in the olden days chooks were fed on leftovers and whatever they could scrounge and they seemed to do ok. Tuesday night is “Pie Night”, where we take our pick from the pies, pasties and sausage rolls from the bread shop. It seemed silly to be bringing all this food home and not to use it for the humans as much as possible. (We’re getting a bit sick of pies, but we still make ourselves eat them!)

With regards to the rest of the shopping:

* I like to stay out of the supermarket as much as possible. I actually really like food shopping, but every time I pop into the supermarket for something I always end up buying more than I went in there for in the first place. So I learned that the more I stay out of the supermarket, the less money I spend overall.

So I tend to do a fortnightly – 3 weekly shop. This is pricey when it happens… I usually spend between $300 – $400 dollars at a time…. but it’s amazing how much I save by NOT buying all of those impulse buys.

* My first shop of choice is Aldi. I adore Aldi with a passion. SO much cheaper than the supermarkets, Aldi has been an absolute godsend to this family. They opened up near here just when the boys were hitting their teenage growth spurts, eating like horses and my grocery bills were soaring. Now I go to Aldi first, stock up with multiples of what we use and then I go to IGA or Coles to buy what Aldi doesn’t sell.

* I look at the supermarket brochures, particularly the “loss leader” specials on the front and back covers. If there’s a particularly good special on something we use, like coffee or peanut butter, for example, I’ll make a special trip to Coles or Safeway and stock up big. A year ago, Coles had a special on 500g tins of Nescafe for $10. I bought about 8 or 9 tins. I’m still working my way through them. Not a bad buy when the tins are usually $18 or so, which means that I’ve been drinking coffee at a rock-bottom price for the last year. I love going into the ‘rip off’ supermarkets with my junk mail brochure in hand, wheeling the trolley around the shop and then walking out with ONLY their specials. It makes me feel great that I’m minimising their profits.

So at any time, our pantry could have 10 jars of peanut butter, 20 tins of tomatoes, 15 tins of marked-down beans as well as all of the other things that are in there. It doesn’t matter, because they’re not going to go off and we work our way through them, bit by bit. When an item is a good price, I buy lots of it, usually in multiples of 10. My supermarket trolley looks very different from most other people’s, but it means that we’re eating a lot of our food at discounted prices. Over time, it all adds up.

* Look at the unit prices on EVERYTHING. I was rapt when they changed the law and had to provide the unit price on everything on the supermarket shelves. It saves so much money, especially when I assume that the larger size is cheaper, but it actually turns out otherwise. For those of us who are mathematically challenged, this has made life so much easier. I also look at the top and bottom shelves of supermarket shelves, because they quite often put the cheaper products away from eye-level. This puts the sport into supermarket shopping and makes it fun when I bag a bargain.

* You need to know your prices! There’s no point buying something on special at Coles if it’s cheaper at Aldi. I sometimes put together a price book, with the unit price of our staples written down, but in the last part of every year, I let this slide. It’s one of my holiday jobs to get this started again because it’s a very useful tool. I just have a small notebook that lives in my bag, and when I do a large shop I sit down after I’ve put everything away and take the prices from the docket and put them in the book. It’s handy to have this record because sometimes you’ll be out and about and see a special on something. Instead of just grabbing armfuls of it and racing to the checkout, it’s good to know whether it’s REALLY a special or not. The warm glow you get when you stop yourself from being inadvertently ripped off (or when you realise that it’s a rip-snorter of a bargain) makes it worth all the nit-pickiness of starting the book in the first place. I want to go with my friend Liz to Costco to see what it’s like. Having a price book will DEFINITELY stop me being carried away and spending up big on things that I think are good value. I need to be sure they are.

* Brand loyalty is stupid. The bottom line is by far more important. Having said that though; I will NOT buy any brand other than Vegemite. Don’t mess with my breakfast! I only buy Nescafe instant coffee and Aldi powdered milk. Their powdered milk is the only brand we like the taste of. Oh! And Masterfoods Devilled Ham spread for a treat. (My grandfather used to use this all the time, so I buy it for my boys. Call me a sentimental fool…) Apart from those things, nothing else we buy is brand related.

My rule is to buy the generic/Aldi brand product first. If we don’t like it, then we try other, more expensive brands. For example, the kids declared that they didn’t like the Aldi peanut butter. Personally, I couldn’t tell the difference, but it’s the boys who eat the most peanut butter, so I complied. We buy the Black and Gold brand from IGA because it’s the next-cheapest and the boys like the taste of it. Recently Coles had a special on Kraft peanut butter (om nom nom… the taste of my childhood…) that made it cheaper than the IGA one, so I bought 20 jars. The kids LOVE it, but when the jars run out we’ll go back to the IGA version, at least until Coles runs the fabulous Kraft Peanut Butter Special again. Though on second thoughts, now I’ve bought the thermomix I can grind down peanuts to make our own peanut butter, so that might be one item that stays off the shopping list. Things change…

* Think ahead. Last December I read a comment on the Simple Savings forum where a woman called Joan said that every January she goes on a marked own ham hunt, where she freezes the portioned-up ham and uses it throughout the year. What a bloody brilliant idea! Me being me, I got a bit carried away and bought 3 hams. I chopped them up into pizza/macaroni and cheese-sized pieces and froze them in little meal-sized bags. Those bags of ham lasted us till the middle of September. I can’t tell you how fantastic it was to be able to reach into the freezer and pull out a bag of good quality ham pieces to chuck into a dish when I was cooking in a hurry. I was quite upset when we used the last one. So a couple of days ago I bought 4 hams. Cost me around $150 up front, along with the 4 hours solid I stood at the kitchen bench slicing and dicing away. TEDIOUS. I’m guessing that a lot of people wouldn’t want to put the time in.

But I now have 54 meals’ worth of ham (including the 4 ham bones for pea and ham soups throughout the year) in the freezer. That works out to $2.77 a meal, or 0.55c per person for each meal, (assuming the boys and I are all eating each meal together). Now that’s what I call affordable meat, and makes the job of cutting it up so worthwhile.

Another way I thought ahead was when I was renovating the kitchen. I allowed enough space to buy a full-sized fridge and FREEZER to stand side by side. I have enough freezer space to be able to take advantage of bargains when I come across them (such as the Christmas hams, for example.) I can freeze our excess produce that I grow in summer and use them in winter casseroles and spaghetti sauces. I love my huge freezer. This item is an integral tool in the next point which is:

* Waste not, want not. I know it’s a cliche, but it’s really very true. Anything you spend money on, you should use… otherwise, it’s a waste of money. With food, “waste not, want not” is truly a motto to live by. We all have to fill our stomachs at regular intervals. If you have teenage boys, they are adamant that they need to fill themselves up every 15 minutes or so. If you manage to fill the stomachs with food you’ve already bought/been given/grown yourself, rather than going out and buying some more, then you’re ahead of the game.

When I was a SAHM over a decade ago when the boys were running around being toddlers, I remember seeing an Oprah show where they were clearing out someone’s messy house and they were throwing rotten food out of the fridge. The organisation guru who was doing the cleaning totted up the prices of the food that he was throwing away and declared the total. It was around $200 or so. He then said, “This is exactly the same as taking four $50 bills and putting them straight into the trash. In fact, it’d be easier and quicker just to do that, rather than go to the trouble of going to the store, buying the food, carting it home and then throwing it in the trash a few weeks later.” That hit me right between the eyes and I’ve been mindful of waste food ever since.

Nowadays we have a food chain going on here which guarantees no wastage. Humans first, then dogs.

If the dogs don’t want it (or they’re getting too fat) it goes to the chickens. Added bonus… eggs for us and manure for the garden.

If the chickens won’t eat it then it goes to the worms. Added bonus, castings and worm wee for the garden.

Anything unsuitable for the worms goes into the compost. This, of course, gets put onto the veggie garden to produce more food for us.

* We grow food. There’s no denying that I’ve put in a lot of money up-front to establish things like the water tank and the raised wicking beds, along with fences for the chicken run and veggie gardens. Ryan17 looked at me recently, raised an eyebrow and asked if this whole veggie growing thing was cost-effective. I said that now that we have the groundwork done, then yes, every year it’ll get more and more economically worthwhile.

Saving and swapping our seed; using home-made fertiliser such as weed tea, worm wee tea and castings; composting all of our waste scraps and chook bedding to use on the gardens; freezing and making jams etc from the things we grow; substituting ingredients to use the things we grow rather than buy the “correct” ingredient from the supermarket; all these things add up to big savings. The main way it saves money for us is that if I’ve gone to all the trouble of growing it, then I’m by far more likely to respect the time from my life that I devoted to it and so actually USE it to cook with, rather than go and buy more food. Again, keeping out of the supermarket is helpful in keeping the grocery bill down.

Without a doubt, the main reason I grow our food isn’t for the dollar savings. I got fired up about growing food when my son’s battle with debilitating depression surfaced. I decided to cut out as many chemicals and preservatives as possible from the food we eat so that I could help him to get well. My philosophy was, “it can’t hurt and it might help” and anything I could do to help him – I was going to do. However, the dollar savings aren’t to be sneezed at either.

*Powdered Milk. Substituting this one product has saved me hundreds of dollars over the last 3 or 4 years. I don’t drink milk (ugh!) but two of my kids drink it like there’s no tomorrow. The up-front saving is, of course, that litre for litre, the cost is less by using powdered milk. The savings with this alone are worth it. But the other saving is that if you keep a few bags of powdered milk in the pantry…. YOU NEVER RUN OUT OF MILK.

This means that I don’t have to drop into the supermarket on the way home. This means I don’t spend money on impulse buys when I’m in there looking for milk. Obviously, there’s no way of calculating the savings I’ve made by not going through those supermarket doors, but I have a shrewd idea that the amount would be substantial.

* Put shampoo and conditioner in pump packs. This makes shampoo and conditioner last SO much longer. Instead of the kids picking up the bottles and squeezing a huge dollop of shampoo in their hands, the pump-top containers dole out a measured amount. The kids have to work to get a comparable amount in their hands, which takes too long. They’ve adjusted to using a smaller amount, which of course mean I don’t have to buy shampoo as often. It all helps and if I can get savings by doing something so simple, I’m going to do it!

* Making things from scratch is usually far cheaper than buying ready-made things. I work full-time and I definitely class myself as ‘time poor”, particularly during term times. Sometimes I don’t get around to making biscuits or cakes for the kids’ recess snacks, or I’m racing around on the weekends doing gardening work or housework and so the kids rustle up their own snacks. I’ve noticed that particularly in the last parts of the school terms, I buy shop-bought biscuits/cookies and convenience foods to save myself the effort of baking. Seems cheap enough… a couple of dollars for a pack of bikkies/cookies, right? But the biscuits I make myself are cheaper, have far more filling ingredients and have no nasty chemicals in them. Buying “cheap” packets of bikkies adds up to $10 a week, which over time adds up to a huge amount. All this for a snack that doesn’t even fill my boys up, so they’re peckish heading into period 3 and by lunchtime they’re ravenous. How can they concentrate on their work?

Doing my own baking saves us heaps every year. Adding some bags of flour, extra milk, cocoa and sugar, along with some fun things like chocolate bits or hundreds and thousands to the shopping list may seem like I’m adding extra items to the shopping trolley, but in reality the raw ingredients end up so much more cost effective than the ready-made items, because (for example) I can make 5 day’s worth of biscuits from a bag of flour costing far less than $2. The same is true for the other ingredients. Over time, it makes a huge difference. One of my holiday jobs, before I go back to work in February, is to have a few logs of biscuit/cookie dough in the freezer for those mornings when I can’t find the time to make a cookie dough from scratch, but I CAN switch the oven on and slice up a log of cookie dough while I go out and water the veggie garden, and have the cookies cooked and cooled, ready for the boys to grab on the way out the door to eat for recess. It’s an investment in their health and wellbeing, plus a money-saving thing as well. It just takes some thinking ahead and some organisation.

I also make our own soap. This doesn’t save us money because I used to buy the cheapest soap on the shelves. What it DOES do is give us the purest, best quality soap in the world for a very reasonable price. The pay-off with our healthier skin is absolutely worth the extra money I spend on the ingredients.

* Watch the attitude. I look on this as a challenge. I love finding a bargain and shaving yet another thing off the shopping list (Why do you think I’m so excited about the thermomix? I can make SO many more things for us with ingredients made from scratch, which means I my shopping list and shopping bill will keep going down!) If things become a chore, I know I won’t do them. I choose to look on the cost-cutting as a fun thing, rather than a burden.

* Get priorities right. I don’t “do” coffee in cafes. My sister and some of my work colleagues can’t understand that, because much of their social lives revolve around meeting friends for coffee and cake. I look at that and think that if you did this every weekday, at a conservative estimate of $6 for a coffee and something to nibble on, that’s $30 a week, or $1,560 a year. Even allowing for a couple of weeks off here and there for holidays, etc, that’s still a huge pile of money for coffee beans and water. You may be able to shrug your shoulders and say that’s ok, but for me… that’s a sh**load of money that I could use for far more useful things, like braces for Evan15, braces for David18 *sigh* or a water tank. Or school books… 2 days ago I just spent over 1K on textbooks and stationery for the 3 high school students. Gotta love it. Thank goodness Tom19 pays for his Uni textbooks himself!

My priorities will be different from yours. My main financial priority is to be totally and utterly debt free, which means that I want to pay my mortgage off. I bought my ex-husband out 14 years ago and I still owe money on this place. I hate that, so I’m throwing money at it. However, I could have paid it off by now, but I have other priorities as well.

Overseas travel for the boys, so they can see how other people live and how good we have it here. I don’t want them to grow up to be ignorant bogans. So I took all the boys to Bali in 2006, then we went to Phuket in 2007. (Shouldn’t waste all those empty pages in the passports! Waste not, want not…!) The first Christmas (2009) that David18 chose not to spend with his father, I took him to Singapore to get him out of the empty house and away where he’d be distracted by all the bright, shiny Singapore things. Then, of course, we had the school’s Stage Band tour in Los Angeles, where David18 and Ryan 17 went for 2 weeks. There’s also expensive school camps, but they get to see places like Central Australia and Tasmania that otherwise they’d never see. So I don’t begrudge spending money on travel. It broadens the mind, so they say.

When I started full-time work, I decided to renovate my 1950 weatherboard house to put a decent kitchen and bathroom in it, as well as a ducted heating and cooling system in. I was going to pay off the house first and then do it, but then I thought about how silly it would be to be getting all of these things done to make the house more liveable… just when the boys were moving out. So I decided to get the work done while we were all still living here and able to enjoy it all. So I doubled my 100K mortgage, got the work done and now I’m almost back to where I started, mortgage-wise.

This past year I bought a lot of Project Things, such as a water tank, solar panels, the thermomix, solar oven and such like. They’re one-off purchases to minimise our bills in the future and/or make like easier. Now I have them, the job is done and I don’t have to buy them again, barring unforeseen accidents, of course. Now that I have these things in place, I can turn my attention back to the main priority, which is the mortgage.

I have also spent a lot of money on music lessons, over the years. Again, I don’t begrudge this, as playing music and singing well is a skill. Investing in developing skills is money well spent.

As I said in the beginning, I’m very conscious that I’m a single wage earner who is supporting a lot of people. I don’t want to end up eating tinned cat food in an indigent old age, so I’m paying down debt and stewarding my money in the most prudent, mindful ways possible. Cutting down on our food bill while still providing my family with the best food I can is probably the most important way I save money to safeguard our financial future.

Plus, I like the challenge!

Approaching retirement from a position of strength.

October 21, 2018 / / 18 Comments

It’s funny how when you’re young, retirement seems a lifetime away. Which, now that I’ve typed up that sentence, seems pretty logical, at least for the traditional view of retirement. I’m clearly a genius…

 I vividly remember when superannuation was introduced in Australia. ( For the benefit of overseas readers, it’s the retirement account that employers pay 9.5% of a worker’s wage into. People can’t access this money until a defined age, based on when you’re born. For me, it’s 4 years away…yeah, baby!)

I was around 18 and working at a Coles shop in the Bourke St mall on the weekends when I was at Uni. When I started I was asked if I wanted to sign up for voluntary superannuation. I didn’t even know what it was. When I was told it was for retirement, I laughed and said, “Oh, I don’t think I need to worry about that yet!”

I was an idiot. The compounding on that money would have been incredible by now.

For most people, myself included, tipping more money into superannuation only becomes a priority when we reach the more mature decades of the 40’s and 50’s when retirement becomes more concrete. But by that stage, many people are up to their necks in debt. How can people save for their ‘golden decades’ when a huge proportion of their wages are earmarked to pay interest on stuff before it even hits their bank accounts?

That’s when the panic sets in.

I suppose I was fortunate to have a different model when my brother and sister and I were growing up. Mum and Dad were frugal. Dad had an all-consuming passion for bringing home vintage and veteran cars (usually Rileys) home in boxes or on the backs of trailers and restoring them to mint condition. He was a perfectionist, spending hours of time and quite a few dollars on bringing these cars back to how they looked when they were new. 

I remember talking about this with Mum one day when I was about 10 or 11, and Mum saying, “Your father always wanted to restore a ‘Riley 9’ because it was the first car he had when he was growing up. But he didn’t bring home a single car until he’d paid off the mortgage.”

Dad modelled that being debt-free was something important that you had to achieve. He also demonstrated self-discipline by denying himself the car. He’s a man who, when he has a hobby, throws himself into it whole-heartedly. He was obsessed with his cars, to the point that my clearest childhood memories of him are of his feet sticking out from under whichever car he was restoring when I went to the garage to call him in for lunch or dinner.

It would have been very easy for him to take out the mortgage on the house, start his family and then ‘reward’ himself by bringing home a car. Why not? That’s what everyone else seems to do.

Instead, he set himself the goal of paying off the house and being debt-free, THEN rewarding himself with the car. And not a brand-new car, either. It was a 30-year-old Riley 9 that he literally brought home in boxes and rebuilt from the ground up. He bought it very cheaply, then cash-flowed the restoration, giving himself untold hours of entertainment right in his own backyard.

He and Mum also joined the Riley car club, where the main activities seemed to me, as a kid, to be driving to parks with picnic lunches, where they’d all park their cars in a row and admire them. Mum would chat with the other women, Dad would crawl all over the cars with the other men, while we kids would race around with all of the other kids. Pretty cheap entertainment!

(I found this photo online that shows how we three kids would ride in the ‘9’… in the boot, with no seatbelts. NO WAY would it be allowed today! But by gum, it was fun.)

Meanwhile, what was happening with the money that used to be paid into the mortgage?

At first, Dad was the sole wage-earner, but once my little sister was in school Mum went back to part-time work. Her wage paid for the ‘extras’ – ballet lessons, cosmetic renovations to the decor, little family holidays etc. Dad paid for bills, groceries and a ‘big’ renovation to add an extra living room to the back of the house. Once that was done, he began to invest.

He was primarily a real-estate investor. He was able to throw hundreds every month towards a deposit because they were operating from a position of strength with no debt. They bought a small unit, but after some troublesome tenants they sold the unit and switched to small commercial factories.

Mum and Dad own them to this day. They’ve been retired for around 20 years and they still earn income each month from these properties. After buying 3 factories, they switched their investments to managed funds and were able to top them up rapidly, again because they had no debt.

As their children, my siblings and I absorbed these lessons growing up. Interestingly, nowadays we all appear to be on vastly different spots to each other on the spectrum. I won’t comment on where they are in their finances, (it’s none of my business, after all), but I know that I can see how clear-sighted my parents were about the future they wanted when they were working towards their eventual retirement.

(Mum in Bali. She and Dad go there for a month every year, as well as doing other trips.)

Dad turned 80 this year, while Mum is a couple of years younger. They still take trips overseas every year, as well as frequent long weekends away with the Riley Club. Dad collects watches. He doesn’t have to check his bank balance every time he wants a new one to add to the collection. Mum does Art classes a couple of times a week. They live comfortably on the income from their properties and investments, still living in the house that they bought 3 years before I, their oldest child, was born.

This was all made possible because they valued being debt-free and investing for the future, all while bringing up their family in a lifestyle where we had all our needs met, with some of our wants granted. If their health deteriorates they’ll be able to sell their factories one by one, as well as their house, to provide for themselves as their healthcare costs rise. They made sure they would not be a financial burden on their children.

I so admire this! In literally 10 minutes the school bell will go, and I’ll be walking off to a class that… well… let’s just say that I’ve had classes I’ve liked better. Would I like to turn around and walk out of the school and do something more enjoyable? You bet! Have I reached the number I need to reach to be able to live off my investments without worrying, just like my parents did? Noooo…

So off I’ll go to class, keeping my money invested and compounding, with my parents’ example firmly before me. Present Frogdancer can work for a few more years so that Future Frogdancer can kick back and enjoy her life.

I’m pretty sure that’s what Mum and Dad would want.

 

 

 

Frugal Friday: How I spent 2 hours today getting the most bang for my grocery bucks.

September 28, 2018 / / 12 Comments

There’s a chicken warehouse about a km away from my place, where I go to buy the chook necks for the dogs’ breakfasts. They have fantastic bulk deals in meat, so every holidays I go there and buy a bag or two of either breast, thighs or drumsticks and spend some time parcelling them up to use in the upcoming term. This time I couldn’t go past chicken breasts at $6/kilo. So cheap!

If I’d bought the “skin off” version I’d be paying $2/kilo more. But why on earth would I go that when I have dogs? Tonight, instead of their meat patty and dry food dinner with some yoghurt, I’ll replace the patty with the chicken skins. They’ll be in ecstasy and it’ll cost me nothing.

As I was cooking and chopping and measuring, I thought I’d do a ‘Frugal Friday’ post about everything I was doing today in the kitchen between 10AM and 12PM to save money and make everything stretch a little bit further.

Most of the bag of chicken went into these packaged-up portions. I use Skinnymixers recipes a lot and she tends to have the protein in 700g lots, so that’s what I’ve packaged them in.

I label all my freezer things with masking tape and a pen. Works like a charm. I decided to do this after the day I was running late for work and didn’t have time to make a salad for lunch, so I grabbed what I thought was one of my Emergency Lunches from the freezer. Imagine my dismay at lunchtime when I opened it to find a couple of uncooked drumsticks in some marinade instead of the Butter Chicken I was expecting…

So far I had 6 meals’ worth of chicken to feed 3 adults and have at least one or two lunches left over with each meal. Not a bad start…

While I was doing this, I had 2 Costco chickens on the stove, making stock. I’d been to Costco a couple of days before and I picked up two chooks. At $6 a pop, how can you walk past them? We’d had a couple of dinners and lunches from them, so today I put the carcasses and the leftover meat into a saucepan of water, brought them to the boil and then simmered them for a couple of hours. I read somewhere that if you add a dash of vinegar to the water it helps draw out the calcium from the bones. I have no idea if this is scientifically valid or not, but I do it just in case.

This is real ‘set and forget’ stuff. I can get 3 or 4 soup bases out of each chicken. It just burbles away on the stove while I’m busy doing other stuff.

Once it’s done, you drain the bones and meat from the stock.

DON’T do what I did once – I cleverly put the colander in the sink and poured the stock and carcass into it – only to watch all my precious stock go merrily down the drain.

Once the stock cooled a bit on the bench, I popped it in the fridge to get cold. Later, I’ll skim any fat from the surface and pour it into plastic containers to freeze. Nearly every Saturday we have soup for lunch, using up any sad veggies, leftover pasta or rice and things like that. I flavour it with chicken stock paste, or tomato paste, and throw in beans I’ve cooked from scratch and frozen – anything that will be tasty and that I need to use up.

Here’s the meat I saved from one of the carcasses. I’ll probably get 2 soups’ worth of meat from this. I like to freeze them in shallow containers lined with baking paper, so when I take it out to use them I can lift it out of the container and snap off how much I think I’ll need. It’s crazy how much food is left on a leftover chicken that would normally have been thrown in the bin.

 

I mentioned the chicken stock paste that I make. I had some vegetable stock paste still in the fridge, but I’d run out of the chicken stock paste. Making it yourself is so much tastier and healthier than using stock cubes. You can definitely taste the difference. So I used one of the breasts in the bag of chicken to make some stock paste, while another 700g of meat was used to cook dinner for tonight – a Chicken Tikka Masala. I had both thermomixes cooking this up while I was busy chopping the rest of the bag of chicken into the portions you’ve already seen.

I’d call this stock paste ‘Liquid Gold’ if it was a liquid! It has a heap of salt in it, which is the preservative, and it lasts in the fridge for weeks. I’ll put one jar in the fridge and the other in the freezer and I’ll be right for Chicken Stock paste for the next 6 months or so.

There’s enough chicken skin here to keep three little dogs very happy tonight.

The recipe for the Chicken Tikka Masala calls for 70g cream, but I always use the yoghurt I make myself. I use an old Easiyo container to store it in, but I make it in the thermomix for around $1/litre.

This capsicum was soon chopped up and thrown into the bowl, but have a look at what I’ve got planned to save money here in the future:

Here’s a sneak peek at the mini greenhouse I’ve got. Once the garden gets going, hopefully I’ll have lots of produce chopped up and frozen to use throughout the year. AND all of these plants are heirloom vegetables, meaning that I can save their seed for next year and I’ll never have to buy seeds or plants again.

The bag of chicken breasts wasn’t finished yet! Now that Spring is here, I like to take salads, rather than cooked lunches, to work. I decided to steam the last couple of breasts so that I could shred them and use them as protein in my salads or on pizzas.

Here’s a shot of the Chicken Tikka Masala cooking on the left, while the steamed chicken pieces are cooking on the right. Meanwhile, the second Costco chook is bubbling away on the stove behind me and I’m stacking the dishwasher. I have a podcast on my iPad and it’s all happening!

Once the chicken was steamed and then shredded, I portioned it up into small handfuls.

9 single-serve meals’ worth of protein here, either for salads or pizzas. This is making me feel all warm and fuzzy – I love having meals prepared for Future Frogdancer and the boys.

Speaking of preparing meals – here’s dinner. I’ll just have to cook some rice and then the boys and I can help ourselves. There’ll be enough leftovers to freeze for an Emergency Lunch or two as well.

While all of this was going on, I was bagging up the chicken necks that I’d put into piles of 5 and flash-frozen. Each pile is enough for breakfast for the dogs. All I have to do is remember to grab one at night when I feed them, so by morning, they’ll be defrosted. (The chicken necks, not the dogs.)

And finally, all of the veggie scraps and the dog hair that Ryan23 cut from the Cavaliers yesterday was put into the compost, so that one day it’ll all be recycled into feeding the plants that will then feed us. Apparently, hair adds nitrogen to the soil. Who knew?

For around 2 hours in the kitchen, pottering around and listening to podcasts, I’ve organised around 20+ meals for us. The main cost was for the chicken, with the bag of chicken costing $36 and the 2 Costco chickens costing $12. (But we’d already had 3 or 4 meals from those Costco chickens…) 

Anyway, it’s impossible to calculate how many actual servings this will all produce. My boys are adults and they are sometimes here for dinner, sometimes not. They eat a lot – they’re men. So some dinners are totally eaten on the night, while others have leftovers that get packaged into smaller lunches for people the next day.

But I like to calculate how much it costs me per meal, obviously with the shredded chicken portions only serving one person, while the diced chicken and soup stock could be serving as few as 3 people or as many as 5. So let’s just count each meal portion as 1, with each soup stock counting as 3 meals.

9 X shredded chicken + 6 X diced chicken + 6 X soup stock + 1 X Chicken Tikka Masala = 22 meals’ worth of protein.  Plus the 4 meals we had from the Costco chooks before I made stock from them = 26 meals overall. (I won’t count the dogs’ dinner of chicken skins tonight! Let’s call that a bonus.)

$36 bag of chicken breasts + $12 Costco chickens = $48.

$48/26 = $1.85 per meal of protein. If I was able to estimate how much it would be per person then the costs would go down even further, because the dinners and Costco chicken meals are covering multiple servings that I haven’t accounted for. I’m pretty happy with that.

I think that the 2 hours or so that I spent in the kitchen today was certainly time well spent. By the time term starts in another week I’ll have my freezers and pantry prepped and ready, so that Future Frogdancer won’t be driven to get takeaway meals when she feels tired at the end of a long week.

This makes me feel all Laura Ingalls Wilder – my family is being looked after and I’m ready for the zombie apocalypse, should it occur.

I like feeling prepared.

 

Learning how to tell a luxury from a necessity.

February 16, 2018 / / 1 Comment

One of the things we read all the time in the FI/RE space is that one of the most important ways to turbocharge our path to financial independence is to learn how to distinguish a want from a need. I was about 13 when I learned this lesson, in a way that I’ll never forget.

Mum and Dad, my brother, sister and I lived in a comfortable middle-class suburb in Melbourne. We were by no means wealthy, but my parents earned enough that we had all of the necessities of life and quite a few comforts as well.

When I was about 12 or 13 I discovered an English magazine for teens called ‘Pink’. I absolutely loved it. God knows why – I was looking at covers for it while thinking about writing this post and it looks AWFUL. Everything that a feminist would despise. But at the time they were certainly pitching to the right audience. Every week I’d take my money up to the local newsagent and get my ‘fix’, bring it home, read it and add it to the pile of previous issues. It was a staple part of my regular routine and I didn’t ever imagine that routine changing.

Then one day Dad lost his job.

Mum and Dad were a bit upset about it, but in my sublimely selfish teenage way I didn’t let the news cause a blip on my radar, until the day Mum came out into the backyard where I was playing with the dog and said that she wanted to have a talk to me.

She explained that with Dad being the main breadwinner and with them not knowing when he was going to be employed again, they’d decided to make some cutbacks in expenses. So I wouldn’t be going on the year 8 school camp. I was a little upset about that, but I figured that it was only for 3 days and they’d pass quickly. They were pausing my sister’s dance classes and doing a few other things that I don’t remember about now. But then she dropped the bombshell – the one you already guessed was going to be dropped.

Yep. No more ‘Pink’ magazine until Dad found another job.

I was devastated. I cried. Mum said, “This is incredible. I thought you’d be more upset about missing the camp!” On my side, I couldn’t believe that they’d stop paying for something that only cost a couple of dollars a week. How was I going to keep up with the serial stories? There were HEAPS of them. What about the gossip columns and agony aunt pages? How was I going to keep up with the fashions and who and where and what the rock stars were doing? Remember, this was long before the internet. I was truly going to be stranded.

I thought they were so unreasonable. If there was an emoji for a 13-year-old girl having a tantrum I’d put it here. I begged and pleaded. But Mum and Dad wouldn’t be budged. They were tightening the reins on the family finances while we were in this tight spot and that was that.

So my life was ruined.

Six weeks after that, Dad found another, better job. Mum came to me on his first payday with a couple of dollars in her hand.

“Darling, you can go to the newsagent and start the subscription up again.” She was so happy to be able to make me happy.

I remember so clearly looking at the money, then thinking about the magazine. Was it worth getting it again? Yeah sure, at first I’d missed it dreadfully, but as the weeks went on I lost track of the serial stories – I knew that if I bought the latest edition I’d have no idea of what had gone on in the meantime. The pop groups? They were mainly British and most of them weren’t really big out here anyway. The fashion was 6 months ahead of us anyway and I didn’t even wear makeup yet. I couldn’t believe what I knew was going to come out of my mouth.

“Thanks, Mum, but I don’t want it anymore. I’m not missing it so you might as well save the money.”

It was a revelation to me that something that I once prized so highly took only a few short weeks to fade into insignificance. Mum and Dad were right to cut back when times were tough. Very few things are truly necessary, while most other things, though being nice to have, can easily be sacrificed if need be.  I learned a few very important lessons from giving up that silly magazine that stood me in very good stead when I was bringing up my boys on a shoestring budget and I had to cut deep.

They say that the things you learn in childhood stay with you, both good and bad. One of the best things my parents did for us was to demonstrate their absolute determination to not live beyond their means. It would have been so difficult, if not humiliating, to take pleasures away from their children and see their distress. But they kept the bigger picture in view and made their decisions for the overall financial stability of the family.

“Monkey see; monkey do.” It’s true; kids observe everything their parents do. I was lucky that mine showed me a valuable lesson, with the sting from the loss of the magazine probably flagging that memory so I’d never forget it.

 

 

We all have to spend – just make it intentional.

January 7, 2018 / / 12 Comments

 

I firmly believe that one of the cornerstones of Financial Independence is frugality. But ‘frugality’ is a funny concept. One man’s latte is another man’s wild extravagance. I’ll come clean right now and confess that I consider myself to be an extremely frugal person. After all, any single person who’s brought up 4 kids and paid off a mortgage on their own hasn’t exactly been throwing the avocados on toast around. However, my frugality has certain limits. There’s a fine line between frugal and stingy. The annoying thing about any discussion about frugality is that every person seems to draw the line in the sand between the two concepts in a different place.

The kids and I have been on our own – if you can call 5 people being “on our own”! – for 20 years. When my marriage hit the skids I’d been a stay-at-home-Mum for nearly 6 years. I had 4 years to go before my youngest was due to start primary school. My goal as a parent was always to stay at home with my kids until they were all at school, so when their world turned upside-down with the divorce I vowed to stick to that plan, to give them a rock-solid foundation upon which to build their worlds. This meant tightening the belt.

I had a couple of advantages to start off with. The first was that my ex-husband was never what you’d call a wildly successful businessman, so for a fair few years I’d been watching the household finances and being reasonably careful. The other was my upbringing. My Dad watched every penny, so unbeknownst to me, I had excellent training in making every penny count. Those lessons have stood us in good stead over the last couple of decades. But the most useful tool I’ve come up with is something I only started using in the last 20 months when frugality became a necessity again.

Ever tried living on 27% of your take-home pay for month after month? That’s what we were doing while I was paying bridging finance for The Best House In Melbourne while getting all the plans and permits to develop our old property. What should have taken 6 months took 17 months, thanks to the local council and various tradies dragging their heels. That’s a long time to be living off the smell of an oily rag. I had an emergency fund in place, just in case something awful happened, but the rest of our lives was cash-flowed. I had to watch every cent that came in and out of the house.

I’ve never had a ‘budget’ as such, but I’ve always spent less than I earned. I heard someone say somewhere that “if you can’t measure it, you can’t manage it.” That made sense to me, as nit-picky as it appeared. You can’t steer a car in the right direction if you don’t know which road you’re on to start with.

So why not measure my spending? Why not rig up a basic chart on my computer that documents every amount I spend? The challenge, because you’ve got to make it fun, is obviously to spend as little as possible on non-essentials.

Have a look at the chart. I made a few rules to start with. After all, if I didn’t it would be anarchy and we simply can’t have spendings and savings running amock all over the place. That way madness lies.

I direct debit my bills, so I couldn’t choose which day of the week they’d be paid. So rule 1 was that they were excluded from the table. Imagine my agonised expression if I’d thought I earned a silver square and then Telstra took the money from my credit card on a Tuesday instead of a Friday. It just doesn’t bear thinking of.  Next rule: even one dollar is to be counted. Our money situation was so tight that I had to be conscious of everything. Third rule: no cheating the table, no matter how tempting.

But the best thing I did, a few weeks into it, was to put the last column in – where I can colour in the square if I have 3 or fewer days that I spend in a week. Now this suddenly made the whole exercise INTENTIONAL. And that’s when it really took off.

It’s crazy the way the human mind works. I really wanted to colour in a silver square at the end of each week, so I started grouping my spending together. We live around the corner from an Aldi. Before the chart, if I was getting low on one ingredient for dinner, it was too easy to send one of the boys galloping to get it. But now, the game had changed. Was this ingredient important enough to use up one of my spending squares? If so, I’d send them to Aldi with a shopping list, to avoid this happening again with other things that might be running out in the pantry. But if it was something that I could leave out of the dish altogether, or I had a substitute I could use if I thought for 2 seconds about what else I had in the pantry, then the boys stayed home and I could triumphantly colour in a square that night.

If I knew I was going to go to Costco on the weekend, I’d schedule other shopping trips at the same time. If I needed some wine, (always a staple in the Frogdancer house), I’d swing by Dan Murphy’s on the way home. Aldi doesn’t sell everything we use, so the Coles or Woolworths might also get a look-in on the same day. I always buy my petrol at Costco, so there was another stop on the same day. I would consciously try and spend only on the one day so that I wasn’t using up my squares willy-nilly.

This had another additional saving that I wasn’t consciously aiming for when I started it, but it soon became evident that I was using less petrol. The car wasn’t being dragged out for ‘one-off’ trips to the shops but was being used for multiple things. The saving was significant enough for me to notice that an extra week was being added before I had to refill the car – obviously not enough to pay for a trip to Europe or something. Still, every little bit helps.

I believe that we all have a couple of little things that we spend money on. Things that are so cheap that we buy them without really thinking about it, because “it’s only $2”, or “it’s just a coffee.” Mine isn’t coffee. It’s so stupid that I feel a bit embarrassed even writing about it. Mine is $1 Caramello Koalas/Summer Rolls/Honey Nougat logs from the staff common room when I ‘m correcting essays.

The school I teach at is incredibly popular. We’re one of the top non-selective government schools in the state, which basically means that if any child lives in our zone, we have to take them, regardless of gender, religious views, sexual orientation or intelligence. The kid could be a certified genius or a dribbling idiot and if they live in our designated area, we have to take them. Our VCE results each year are so high that people literally pay thousands more per house or apartment to move into our area, which leads to a lot of kids lining up to be taught each year.

Our school currently has over 2,000 students.  Our 3 youngest levels have around 14 classes of 28 students each. With 4 or 5 classes in a regular teaching allotment, that’s a lot of essays to mark. Sadly, once the chart was in operation for a while, it became clear that I’d become dependent upon the sweet sweet taste of chocolate and caramel to get me through the hard yards.

The really good essays are easy. No problem. You zoom through them, scattering ticks and the occasional minor suggestion or correction here and there. No need for chocolate here… in fact you almost feel like doing a lap of honour around the staffroom because you clearly taught these kids so well. But then you get to the strugglers and the lazy ones. The kids who are genuinely trying hard aren’t so bad. You want to knuckle down and help them. But their essays take a lot more time to mark because there are so many grammatical errors, spelling mistakes and flaws in the structure of the essays. But then you get the doozies – the ones who couldn’t be bothered reading the novel. They watched the movie instead. Some of them even absent-mindedly write “the movie” instead of “the novel”. One boy in year 12 a few years ago was meant to be writing about Shakespeare’s play “Richard III” and he began his essay talking about the tank that crashed through into the bunker of the Lancasters and how the gas mask made Richard seem evil. I agree, it was a wonderful movie adaptation of Shakespeare’s play but it wasn’t what we’d actually studied. Shakespeare isn’t terribly well-known for his twentieth-century modes of warfare and transport in his plays. To his credit, the student and I both had a good laugh when I tackled him over it. But when things like that happen… it’s a blow to a teacher’s fortitude. These essays are definitely not a pleasure to read and there seems to be a lot more of them than the excellent ones. Unfortunately, it’s unprofessional to turn to hard liquor. For some reason, the school frowns upon alcohol being consumed while correcting. The next resort is chocolate.

Having the chart definitely cut down on that mindless spending of, “Dammit, I’m working hard and I deserve it!” I’m not saying that it stopped it altogether… there’s a square that is clearly marked “$4 marking”. I must have had 2 classes worth of essays to mark at the same time, which is a stupid move on my part. Or else I had a class of remarkably stupid kids! However, the chart tended to make me stop and think.

When I first started using the chart, I tried to push on through, but that sugar rush was hard to ignore. Then I had a brilliant idea. What if I substituted nuts and dried fruit for the chocolate bars? I started buying the ingredients for trail mix from Aldi, then making up bags of it and making sure I had some in my desk, particularly at the end of term, always a peak marking time. I was still able to have the sugar rush from the dried fruit, while the nuts and seeds satisfied the ‘junk food’ comfort nibbling. It’s probably cheaper, but the main advantage is that the ingredients are bought during normal grocery shopping and I don’t have to make the dash to the common room and wilfully squander a square.

It’s stupid, but the chart works. You get to Thursday and you could pop into the supermarket on the way home, but you only have one square left. Better leave off going till Friday in case something comes up… or even Saturday. It stops a lot of impulse buys, because you’ve got Rule 3… don’t cheat the table… and you really want the reward of that silver square. It’s totally individual, with no-one but yourself accounting for what you spend. Which is brilliant, because then you can then tailor your week to when you need or want to spend money.

I’ve been doing this for nearly 18 months now. I have control over what I spend my income on. It takes less than 2 minutes a day to do, and if you’re like me and use a credit or debit card for all your spending, it’s so easy to jot things down on the chart because you have the record there. For me, the secret sauce to this is obvious.

It’s the final column that has made me stick with it because my spending is now totally deliberate and INTENTIONAL. I consciously choose what I want to buy and what I choose to avoid. That accelerates my progress towards the things I truly value.

At the end of the day, I’m a valuist. I put my money towards things I think are important and I bypass the things that aren’t. And these are the things that are different for everyone – the line in the sand that we all have with frugality. When you measure this, you can absolutely manage it and get to where you really want to go.

 

 

 

 

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