Day of Reckoning

It has been 6 months since I started in earnest my frugal journey; I had been a mere dabbler before.  I kicked the year off with just over £18,000 of debt (apart from the mortgage) and a steely determination to not only clear this debt but to make a conscious and permanent change to my consumerist ways.  I am a novice and I’ve had good days and bad days but that steely determination has remained, admittedly waivered occasionally but thankfully it still remains)

On 1^st January 2012 my debt was thus:

Credit Card         £5294.54

DFS                     £678

Car Loan            £5000

Student Loans   £7240

Total Debt           £18212.54

So 6 months in:

Credit Card         £0.00

DFS                      £0.00

Car Loan              £2000

Student Loans     £7240 

Current Debt     £9240

My credit card for the first time in years is clear and so it shall remain.  I have made the final installment on a sofa from DFS and I’ve cleared (by overpaying) £3000 off my car loan.  I purposely chose a car loan that allowed you to pay early without penalty, the interest rate is slightly higher (put it was only slightly 0.25% higher) and I am determined to clear this loan by September and by paying early (4 years early) will have saved over £1200 in interest!

So what’s left, well £2000 on the car loan and £7240 student loan (sorry the Government is last on the list).  The car loan due to it being a higher interest rate takes precedent so I will be throwing everything at that.  Now whilst I will throw as much as possible, I won’t forget to add to my working capital savings, the little pot of money which will ensure I don’t have to rely upon my credit card when the unexpected happens, i.e. the bed breaks J and I can get off the merry go round of getting into debt whenever a big bill either planned or unplanned drops on the doormat.

Reflectiing upon the first 6 months ..... I have survived, I haven’t bought any new clothes; apart from my 40^th birthday (and most of that was courtesy of Tesco clubcard vouchers) we haven’t eaten out; there has been no weekends away, no expensive day trips; I haven’t shopped for anything that hasn’t been an absolute necessity, always asking the same question whenever I consider a purchase do I want it or do I need it – if it falls in the former it remains in the shop. 

I have made do and mend and I have fallen back in love with baking, we have eaten incredibly well whilst reducing the grocery bill by 2/3rds, we have enjoyed such simple pleasures, walk on the beach, browsing for a new book in the library, watching an old movie curled up on the sofa, gardening and crafts and I honestly feel richer for it.  So its more than I've survived the past 6 months I honestly think its been one of the most liberating experiences of my life.

So here’s to the next 6 months, I hope to continue to learn and I thank the other frugal bloggers and you my dear followers for your inspiration and ideas, as I continue my journey to financial freedom – Happy Days

                                               

Banking, Beds and Bartering

Now I wholly agree with most sound financial advice in that it is madness to have savings while you are in debt, you should throw everything at your debts to clear them, as paying interest is quite literally throwing your money away.  However it is important to plan and bank some working capital, this is money put aside for big annual bills as well as a contingency fund to pay for the unexpected.  Today we had to pay for the unexpected.

On Wednesday I broke our bed, now I say I broke, obviously this is our marital bed which gets equal amount of usage plus a doggy who normally sleeps at the bottom,  the fact is the bed broke but as it was on my side of the bed, it has been agreed I broke it J.  A comfortable bed is an absolute necessity in my world and we decided to take the opportunity to upgrade from a king size bed to a super king size bed (divan with a quality pocket sprung mattress).

Now it pays to do your homework, I checked out all the main bed company sites, plus wholesalers and for a quality super king with a good mattress we were looking at around £1200 yikes.  On checking out the deals on Bensons for Beds I found a bed in the “sale” (I am always dubious about so called sales) for £799.99 which seemed perfect.

On checking the small print they charge £39.99 for delivery, some companies do offer free delivery but again I always believe nothing in this life is free and they just add that cost onto the goods.  For example Dreams offer free delivery but the nearest bed for spec / quality that I could find was £400 more expensive so they can keep their free delivery.  So we were anticipating paying £840 inclusive for the bed. 

We decided to pop along to our nearest showroom to test the bed out to make sure it was right for us and the price in store was £840.99 plus delivery on top so £880.  This is where it pays to do your homework, when I pointed out the online price the sales assistant immediately said they would honour that (too right) now down to this delivery charge.  I am married to a husband who believes there is always a deal to be done and a haggle is to be had.  Needless to say we left the showroom with a bed, to be delivered in 12 days with a mattress protector and 4 pillows for £800 all in.  Best of all it wasn’t put on the credit card (like days of old) and sinking us ever further in debt, it was paid for in cash from our working capital fund.  That will ensure I sleep like a baby J 

Down Shifting

One of the easiest ways to save money on your grocery shopping bill is downshifting.  I have been slowly doing this for a few years and in the main with huge success as I've moved from a top brand, to a lower priced brand, to the supermarkets own brand then finally to the value/basic range.  

Down shifting is in itself a journey of trying and tasting and see what you can / will change.  I love food, I wont eat rubbish and certain things I wont compromise on, nor will I support questionable farming and animal husbandry techniques so for example my eggs will only ever be free range.  

I am however lucky I can still financially afford to make those decisions, I don’t judge, my mum brought up 5 kids on barely nothing and she didn’t have the luxury to make or consider those issues, she simply had to feed 5 hungry kids, that was her only concern and she did an amazing job.  

I would say nearly 80% of my shopping basket now is the value/ basic range, below is just a flavour of what I used to buy and what I now buy

Just a selection of what I used to buy

Napolina Penne £2.09

Homepride Flour £1.49

Kerry Gold Butter £1.40

Flora spread £1.70

Napolina Chopped Tomatoes £1.35

Schwartz mixed herbs £1.05

Florette Salad £1.74                                            Total Cost £10.82

And now what I buy by downshifting

Basic Pasta  £0.39

Value Flour £0.52

Value Butter £1.19

Value sunflower spread £0.75

Value chopped tomatoes £0.31

Value mixed herbs £0.19

Value crunchy salad £0.99                                Total Cost:  £4.34

All of these staples are eaten daily/ weekly in this household and my annual grocery bill has reduced in the region of 40% over the past 2 years, this has been achieved by not consuming any less (my next challenge) but simply by downshifting.

Tried and tested but no compromise

There are certain brands however that I stick with, we’ve tried others, but either me or hubby refuse to downshift

Heinz Baked Beans

Weetabix

Nescafe Coffee

Dips – this is what has inspired todays blog.  We had friends over last night and I decided to opt for some frugal nibbles with drinks, I chose basic range multi-dips which were quite frankly vile, really vingegary and sour.  Thankfully I had lots of other good, yummy stuff to eat, its not a product we eat often but I wont be buying the basic/ value range again J

Its really just being a little brave, stepping outside your habits/ comfort zone and seeing what changes you can and will make.   In a lot of downshifting I defy anyone to actually notice the difference in taste, but you will see a huge difference in how much you can and will save. 

Just checking in to say Hello

The commute seems harder this week and I'm sooo tired, I think I might be coming down with something, so just hanging in there until the long bank holiday weekend.  I have updated my spending diary, but no inane witterings tonight - hope you had a lovely day Cx

Fallen off the Frugal Wagon

I feel I need to make an act of contrition, April has been out of control, I feel lost financially and I need to regain the control that since January has been in total grip. 

It’s all my own fault, April has been like all the diets that I have ever been on, I just have one minor blip and I throw in the towel – oh I’ve eaten a cream cake, well that’s it I’ve ruined it, I will just stuff my face and be damned.  My frugal journey however will not be tossed to one side so easily, yep I’ve fallen but I am determined to get back on, draw a very firm line underneath it and start May as I mean to carry on. 

So where did it all go wrong?  Well April has been an expensive month but what started the catalyst was our week holiday to Durham with friends.  This should be a relative cheap week as we take it in turns to cook so we only ended up cooking 2 meals however this with drink cost a total of £170 (for 8 people), that is horrific for essentially a home cooked meal.   I have issues, I feel I have to show off, be the generous host and as I wasn’t in my kitchen and didn’t have the time and the ready ingredients to bake and cook as I would, I instead bought and boy did I buy.  

That being said I should have just accepted that and counterbalanced it by being extra frugal at home, but no this blip took hold, I failed to plan for the rest of the month and I have shopped as I used to do in the bad old days.  I essentially lost control and I have spent in excess of £640 this month in food and drink alone, this coupled with darling nephew’s birthday and confirmation and spending too much on him (as well as the catering) plus hubbys car insurance, and indulging hubby in buying him some new holiday clothes, the costs have well and truly spiraled and we have spent over £1000 this month on non-essential spends plus additional money (ie. Car insurance) in essential spends crickey o’reilly!   

I just didn’t know how to handle the curve balls, falling out of the routine with all its extra expenditure/ financial pressures........ sorry that’s a cop out I did know how to handle it, it’s just that I chose not to handle it how I should and my in for a penny in for a pound old self reared its ugly head.   I spent unconsciously and its only now as I tot everything up that the true extent of my failings has become a reality. 

Right now all that is off my chest, I feel as though I have cleansed my soul.  I am going to spend the rest of this evening planning May within an inch of its life, menus, batch cooking, spends etc. 

Before I can ever realise financial freedom I have to have complete financial control and I’m grabbing it back with both and very firm hands.

Cxx

Give with one hand .... take with the other

Money: There's nothing in the world so demoralising as money – Sophocles

Well that will teach me for being so buoyant on Sunday realising my gas/elec bill would be reduced due to my frugal ways.  Today I received the reminder for my car tax, now this little swift move I shall regale by our beloved government passed me by.  Last year my annual road tax for a 2003 1.6 Peugeot 307 was £165, this year it is £190.  On investigating this huge rise, the car tax rates themselves have not increased but the formula to determine your road tax banding has.  No longer are you judged on your cars capacity but it is now CO2 emissions, so your car is banded on what they believe are the emissions for a car of your age (despite the fact that some people look after their cars, service etc and their emissions maybe lower or higher) grrr.  This change passed me and my nearest and dearest by completely, so I am faced with a 15% increase in my road tax despite the fact that my car has not changed.    Once I've calmed down I will dig out the paperwork from my latest MOT where the actual emissions are measured and see if I stand a chance of appealing, but I will leave that until tomorrow evening as its been such a long day and bed beckons.  If the governments motive was environmentally driven then it wouldnt hurt as much, but the cynical me cannot help but believe they have just found a way in which to make more money.

But honestly do the government not actually realise the economic mess we are in?  Or is it a case they just dont care? The fact that the average household faced with job losses, pay cuts and pay freezes coupled with rising costs in just about everything you have to use to live are teetering on the edge of solvency.  I suppose if you are Eton educated millionaires then no I suppose you don't have the foggiest clue.  So thank you oh government of ours by adding yet more financial burden on our shoulders, by finding an ingenious way of taxing us more in such a cunning and stealth manner, by not actually increasing any rates but by moving the goal posts so anyone who can't afford a brand spanking new car because they are  poor are now finacially penalised for being poor - tax the poor for being poor ....ingenious– very unhappy today, I will try and sleep off the grumpy me and normal half glass full me will return tomorrow Cxx L

Top Up Shopping

Now my focus this month is to curb my top up shopping, the old popping to the shop for a loaf of bread and coming out £14 later……  I am determined not to be seduced by goods I had no intention of buying or to pay over the top prices.  Today I was tested and I am proud that my conscious self rose to the challenge J. 

I needed some margarine and bin bags, so I stopped at the local Tesco Express on my way home from work.  In a lot of ways these convenience stores have taken the place of a Spar shop; however they are canny shops as although they have the Tesco name, to the uninitiated you believe you are going to get the Tesco value for money.  This my dear friends is a cunning folly, whilst there is the odd deal you won’t find any of the value range in a Tesco Express, in fact they seem to mainly stock items which have the highest profit margin and are at the more expensive end of the range; presumably the psychology of this is they rely upon people using them who have run out of something and therefore by limiting your choice to the more expensive variety, they are forcing you to spend more than perhaps you would if you had had the choice available in the larger store.  Don’t get me wrong I like Tesco’s (as much as you can like a supermarket) particularly their value range and their reward points J

So I managed to get some Bertolli spread for £1.15 it was the cheapest brand they had and as I no longer have any brand loyalty and instead opt for the cheapest available, that was fine J  So onto bin bags the cheapest they had was a pack of 20 bin bags for a whopping £2.49, wow practically wrapping my rubbish in gold.  I passed on this and left just spending £1.15, thankfully the local B&M bargains a few doors down was open for just 5 minutes more and I ran in and out and picked up a roll of 40 bin bags for 99p, twice the amount of bin bags for £1.50 less.  I am sure they are not as thick and luxurious as the ones on offer at Tesco’s but they do the job that a bin bag needs to do very well.

Looking back at my old self I would have just picked up the Tesco bin bags as I needed them and would have done it without even realizing I was paying an exorbitant price, I was one of the many unconscious shoppers out there.    I am sure supermarkets huge profits are reliant upon the majority paying more, as they either shop unconsciously or feel they don’t have a choice, as they have run out of something and it’s the only variety on offer.  I just hope those days are now long behind me J

The Reward of Conserving Energy

I don’t watch too closely how much energy we use in our home, like many areas of my life huge improvements could be made, however I have tried consciously to use less.  It has also helped that we have had a relatively mild winter in comparison to the Siberian winters we have seen over the past few years.

I used to however keep the heating on during winter pretty much constantly, now I put on a jumper or jump into bed early with a book to prevent keeping the heating on.   This winter I just put the heating on to take the chill off the house and then switched it off early as I did jobs around the house to keep myself busy and relatively warm, all ploys to try and use less.

I pay my electricity and gas bills by monthly direct debit, there is always a risk with this in that you may be under or over paying, but I need to know and budget for a fixed amount whilst I financially manage myself out of debt.

My joint fuel bill (gas and elec) for the past 12 months has been £119 per month and with the ever increasing fuel prices I was expecting this to increase.  I religiously input my meter readings each month via my on-line account with Scottish Power and doing so tonight the marvelous computer has now reduced my monthly direct debit to £79 per month to prevent accumulating credit.  The extra £40 per month will help ease the ever increasing petrol prices, when I bought my car 5 years ago the cost to fill the tank was £35 it is now £60, during that 5 year period I have had a pay freeze, so in real terms a pay cut year on year, this extra £40 will certainly help ease the increase in the cost of the daily commute. 

Fail to Plan - Plan to Fail

Well the first of the month and psychologically a new financial start, as a fresh supply of money has been organized J.  I have 3 bank accounts – the main joint account where both our salaries go in to and all our bills go out from.  The bills from this account are fixed i.e. mortgage, direct debits for utilities etc and as such is calculated within an inch of their lives.  I then move money into a working account for our fluid spends (this is the only debit card me and darling hubby have in our wallets)which pays for petrol, food and household necessities and “spends” – I have tried to put a frugal yet realistic amount in this account and work hard to ensure we don’t spend anymore.  This is the account that I hope over time to reduce as I become better in my frugal ways.  I then pay a chunk off our credit card debt and then 10% of our joint salary into our 3rd account, our slush fund. 

Now you really shouldn’t save whilst you have debt, but you do need to put some working capital aside each month.  I have learnt the hard way with this one.  Every time I would be close to getting  my head above water, something would happen to duck me under the waves i.e. car breaks down; roof leaks; washing machine dies etc and as I didn’t have any savings would have to rely on my credit card and e voila back  in debt.  My slush fund is designed to stop this particular merry go round.  So whilst I work hard to chip away at debt, I do so in the safe knowledge that I have a safety net to pay for the unexpected.

Today the unexpected occurred – I had to take my beautiful cavachon to the vets, she has been scratching like crazy, gnawing on her leg which had got very sore.  Vet believes its allergies and with cream for the sore leg, antihistamine and an injection I came out 5 mins later and £90 lighter in the pocket.  She’s my baby and for her I would sell my kidney so money is not an issue, but had I not had my slush fund I would have struggled this month to pay the bills and remain committed to my debt clearance plan. 

Pay Day

Well pay day is finally here, ah the highs and lows of this blessed day – the high that I am solvent – albeit briefly (but still a good feeling), then the low of this evening going through the main account to move money around and discover that even though tomorrow is the 1^st I’m broke again.

Since January I have taken my finances by the scruff of their neck determined to be debt free (mortgage the exception) by the end of this year.  I owed close to £18000 – I know it’s not as big as some peoples but it’s big enough. I still have a lot of improvement to make in my frugal ways but I have managed to clear £3000 so far in two months, it’s been tough going but it’s been worth it and I’m well on track to achieve my goal.  The first financial goal of many to come.