Homework, day 1
Why am I participating in this challenge? What do I hope to achieve? What are my long term life goals, 5-10 years? What about my current lifestyle may get in the way?
During the pandemic, we have gotten into bad spending habits, buying adhoc from online shops, spending more on food, eating takeaways more regularly, just spend spend spend! We have also booked five holidays this year and one booked for next year! Wows, crazy but also super exciting, three holidays were bargains (!), one is not bad at all for what it is, and two (one this year and one next year) are expensive. We have put three of these holidays on to credit cards to manage without causing too much stress. We put them on my credit card, then tarted them over to husbands card as he has 0% on transfers for 18 months. We paid a fee for this (3.9%), but it is cheaper than leaving it on my card, and we don’t have the money now to pay them all. So not frugal at all, but still evidence that I am thinking ahead about saving money sort of!haha. So long story short, we are starting this year in debt, and we want to get on top of this as quickly as possible. So, I would like to achieve control over my money, get back into the head space where I am not just impulse buying or wasting money.
I really struggle with the whole life plan stuff, I still don’t really know what I want to do work wise, I guess I will still be nursing, I may have applied for deputy manager by then (I did apply last year then cancelled the interview and applied this year but they had already hired within), I would like to get my NVQ level 5- sent an application off today. Home wise, I would like to be debt free, start investing, have savings, continue to overpay mortgage, be married to hubby, keep loving all our rescue animals!
Our lifestyle doesn’t need to be as spendy as it is, this is just bad habits, so that is the biggest threat to reaching my goals! I guess my desire to travel would also play a part, but to be honest, travel is important to me so I am not seeing it as a negative. I have a little run around car, I paid £800 for, we own the other car outright, we OP our mortgage every month and even though we have debt we make sure its as cheap as possible! We are actually a couple who don’t need a lot, but get caught up in things!
Step 2- review last months spending.
There is no point, it was Christmas and I went crazy spending, I also bought my new laptop and an e-bike- I picked it up yesterday and I enjoyed cycling! We went to Cardiff, I bought more presents, it was hubby’s birthday as well so I got him great presents, I used savings for all of this, so no debt was incurred. My laptop and bike were in the sale, I tried to live without my laptop the last few months but I hated it, so got this in the sale. Bike was in the sale, have been discussing getting an e bike for the last year, I am a big girl so I am hoping the motor will help me want to cycle rather than it feeling like torture. I have gotten into a super bad habit of popping to shops and buying food, nipping in before work and buying stuff, or popping on my way home and getting random vegan bits and bobs. I don’t need to do this, but do it for convenience. I am working the next two days, so I aim to get some food ready in advance so I won’t go and stop!
Step 3- list your spending, step 4- what can I eliminate entirely?
Fixed vs mandatory spending, I will go off and do this with good old fashioned pen and paper, will also need hubby as we spend from our joint account and individual accounts to get a better idea of spends. Step 4 will depend on sorting step 3! To be reviewed!
Step 5- Embrace the art of substitution
This will be helped once the spending lists are made, what is important how can we get it cheaper/free? I joined a gym this year, didn’t read the small print and had to give three months notice- hence paying £115 a month for three months and not going to the gym- made me anxious, will get into this some other time! So, I have now got my bike, a barbell, dumbbells and kettle bells- I discovered I like weights! I got all these in sales/charity shops so this will be my way of substituting the gym. I have toyed with the idea of the local smaller gym, which is £35 a month, including swimming and exercise classes. I will see how I get on.
Step 6- Reduce discretionary spending
There are definitely savings to be made here, we do a big shop at Aldi, great, I pop to Tesco or other, and buy random bits I don’t need, or I go in for something I do need and get caught up in everything else. This can stop, hopefully! Clothes, ah yes, I do like to buy stuff, I don’t need to buy any at the moment though so need to remind myself of that! Oh and send things back- I have a dress to send back and a present for hubby that I bought the wrong version of! We can review our utility bills, not sure how much room there is there though.
Step 7- Empower yourself to insource
I understand this one, and we do try, hubby has limited time around work and I am not great at being handy, so projects can take a huge amount of time. I won’t lie, I would prefer to pay someone to paint than do it myself, I hate it, I always need to do multiple coats, I would prefer to work overtime. We do a lot ourselves, our dog care is done by hubby’s parents as they are retired, we give them eggs or fuel money every now and then, my mum will help when needed. We do our own cleaning and gardening, no children so that’s fine, we do go to the hairdressers- I go once every 6 months and dye my hair myself, I am 34 and not ready for a full head of greys at this time. We have been doing projects ourselves more recently, though they do take a long time!
Step 8- Change your habits, Step 9- plan ahead
This is a big one, this is where I stumble, it is work food! I need to make a big effort to buy in advance and work out what I want to eat. I work 12 hour shifts, one shift on its own is easier to manage than three, as I get in late am tired, and don’t want to prep, so I will be working on this. Today, I will make plans for food for the weekend, we also need to meal plan again as this really helps. I popped these two together as they link up nicely!
Step 10- If you need to buy, buy used or cheap
This is fine, I look on facebook etc, we have a charity on facebook where I have got some good deals, generally I like a good shop around and I like to find deals. I am worse at the impulse, food based buying! It took me a year decide to buy my bike 🙂
Day 2- Write down your goal and pop it in your wallet
So I will do this, I think I will put on about wanting to be debt free and wanting more savings, working towards mortgage free wannabe. This is meant to help with impulse buying as I will see the goal every time I go to get my bank card. Seems like a good plan!
Day 3- Wait 72 hours before buying non necessities
This should be ok, leave it in the basket, think about it, and decide after three days if I really want it! I know some of the websites I use sometimes send you a little discount if you leave items in the basket, so could be beneficial. Whilst waiting, I need to consider, do I actually need it, what else could I do with the money, do I own something that could suffice, could I buy it used for less, could I borrow it from a friend? Therefore, minimising impulse buying and regret!
Day 4- Where’s your money?
- Track your spending, this is ok, I used savings to buy for Christmas and get myself a couple of things, but normally I don’t spend like that. My biggest outgoing at the moment is impulse buying random stuff and stopping to buy food for work, or popping into the shops to get one thing and spending a small fortune!
- Know your net income. Yup I know what this is, my pay is pretty constant unless I pick up overtime, so this is already sorted.
- You need to know what you owe. Hubby and I did this the other day, we have two credit cards and one personal loan, he has a student loan and we have the mortgage. It is noted to make note of interest rates, this is an area I try to be smart. Both credit cards are on 0%, the loan was a good interest rate, and was fixed into the life of the loan, and I have already paid the interest off so am into the capital now, the student loan is hubbies and he deals with it, not much to do I don’t think, and the mortgage is on a good rate, locked in for another two-ish years! I am happy with where we are at in this area, obvs no debt would be great, but it is what it is.
- You need to know what you own. We own our cars, we have a savings account together and one each, not a lot in them but they are there! We both pay into pensions, I don’t understand my pensions, I have had a few and think most are together now!
- Pay down high-interest debt according to interest rate. If I was to do this, I would be focusing on the mortgage! Personal loan interest was added to loan and is now paid off, Credit Cards are both 0% and we are good at tarting and transferring, so expenses are saved massively with this.
- Save up for an emergency fund. So it is advised this should be between 3-6months worth of living expenses, this is something we always talk about doing but are rubbish at, we have always ended up spending it on other things. This should be a priority.
- Save for retirement. We both have always payed into our pensions via our jobs, I have had a few jobs so this has left my pots a bit bitty, I did look into this a lot the other year and got so confused with what I should be doing. I will revisit!
- Start investing. Again another area I find all confusing, but will look at again. I have saved a page on money saving expert to read, the frugalwoods one is fine, but it is based on american information.