28 January 2015

Financial recovery after the holidays

We didn't go over budget during the holidays but there have been many years when we did. If this has happened to you and you're now facing a lot of unwanted bills, I hope we can help. I invite all the readers here to join together to help everyone who needs to get back on their feet again.  Every day, in emails and comments, I'm reminded that this blog has the potential to help people. If you're in a sound financial position, or if you're paying off debt successfully, I encourage you to share your knowledge to help fellow readers.

I hope there will be a number of you who comment with good ideas below. We all have our ups and downs in life. Today you might be helping someone recover from overspending, tomorrow it may be you or me who needs help.

Even if you have one or two incomes coming in, you will have to wait to work the time needed before you collect your pay, and when you do, will there be money leftover to help you get back on your feet? I think the best thing to do is to actively look for ways to make a bit of spare cash. And I guess that will take some work on your behalf but it's better than having to pay extra interest on your debt or fees because you can't make a payment.  Try to pay your mortgage or rent on time, as usual. If you can manage that, these steps to earn extra cash might make all the difference towards getting back on track.

Here are some of the things I would do if I needed to find some extra money:
  • Live off my stockpile for two weeks.  This would leave two week's food budget money to be put towards the holiday debt.
  • Declutter my entire house, shed and garage and have a garage sale. You're hitting two birds with one stone doing this - getting rid of "stuff" and, hopefully, paying off debt.
  • Eat vegetarian meals every second day for a month. This would free up two week's of money usually spent on meat, chicken and fish.
  • See if you can find a temporary job or freelance work.
  • If possible, if you're not on a contract or at the end of your contract, cut off services such as an extra phone, Netfix, pay TV etc to maximise your savings. You can reconnect again later (if you want to) when you're in a better financial position.
When you put in the time and effort and it starts paying off, make sure you put all that extra money towards your debt. Temptation is a terrible thing. Don't start thinking that the extra money is for spending. You've been down that track and now you're trying to repair the damage. Nothing can beat the feeling of being in charge of your debt and then being debt-free. So stop the guilt trip, just do what you need to do, pay off the debt and when you're back on track, continue to pay off whatever you can as fast as you can. Because when you have no debt, life will change and you'll feel that anything is possible. And maybe it is.

What are your ideas to get back on track after overspending?



  1. Hi Rhonda,

    they are all good ideas. I know a lot of people also make extra money on ebay too. I didn't accrue any debt over the holidays, (where I take unpaid time off for 6 weeks to be with my kids) but I did use up my emergency fund. I had two plumbing emergencies and a dog requiring unexpected treatment. Thank goodness someone called Rhonda wrote about emergency funds all those years ago!!

    So my way of bringing things back into balance - ie re-saving the emergency fund - is to just take a bit more care with everything. Do I really NEED to use the car or could I walk? Can I substitute cheaper foods for a while? Are we using electricity as wisely as possible? (does the TV need to go on at all?) Do I need to shower every day, or would a quick wash do? Is water going down the drain that could be watering my plants? Do I need to spend all of our 'fun money' or could we entertain ourselves? It could be a good time to make your haircut last a bit longer, or to use odds and ends of shampoo to wash dishes instead of buying a new bottle of liquid. All the 'little' things really do add up!

    For me it's all about choices, and being in a position to make those choices shows us how lucky we really are.

    Having a holiday debt might mean this is a good time for people to shop around for new phone deals, insurances etc..I switched my phone and internet to another company recently and save at least $40 per month - that's at least $480 per year!

    Good luck everyone!


  2. We started the year tracking our spending. I can already see a difference. We have set a few goals, and this is the pivotal year for us. Sticking to our spending plan will help us accomplish them.

    On another note, I'd love to share articles with you now and then that seem like "weekend reading" What is the best way to get these to you while the forum is down? I don't get to the forum nearly as much as I'd like, but I'm a loyal reader of your blog and look forward to your posts.

  3. I am currently not in this situation but I have been there before with credit card debt. The best piece of advise I received was to make the minimum payments on everything that you can and hammer the highest interest debt first. Sometimes it works best to pay off the smallest debt first then apply that extra money to the next one and keep going until your have reached your goal. Both are good plans but you see results quicker by going with the smallest debt paid first.

  4. Hi Rhonda, I guess what I do would be similar to many people. I collect our change and bank it. I budget and I adjust how we budget as circumstances change. I reduce what I spend on groceries - no treats just staples. Do more of my own baking – this can be hard when one is working full time. Buy clothes on sale. Use the library more or buy second hand books and read blogs and online magazines instead of buying magazines. Reduce my electricity use and drive less to save petrol. My husband and I are slowly creating a stockpile of staple food buying extra items of things when they are on sale. I would happily eat vegetarian more often but my husband would be unhappy to do so, however I do collect recipes that use small amounts of bacon or ham and find these are economical. Other things I am working toward is grating my own cheese for the freezer more often, and using powdered milk in cooking.

  5. Such great ideas, thanks ladies. Please keep the encouragement rolling in.

  6. I agree with Madeleine that one of the best ways to save money is to negotiate or shop around for better prices on big ticket expenses like insurance and car loans, as well as monthly bills like the phone and utilities. The savings can really add up. Once the debt is paid off, keep saving the extra money to use for this year's Holiday expenses. I put a line item in my budget years ago for Christmas and I love having that money put aside. I can enjoy treating my loved ones with out the worry of how I'll pay for it.

    It's also tax preparation time. Make sure you take all the deductions and write offs that you are allowed. If you get a refund - be strong and use it to pay off any debt!

    It can be painful at first but I have found that the more aware I am off how we are spending our money, the better money manager I am.That means budgeting and balancing that budget every month! W e can do it!

  7. Yes we sat down the other night and started to revisit our budget. We had an interesting surprise when we hit our internet quota early so tried to buy an extra 10gigs but it wouldn't work. Upon speaking to the rep on the phone it turns out we're on an old plan and he offered to upgrade us to more gigs per month for less money! We have been talking about checking out the best deals lately but it took something going wrong to make it happen. And our new deal didn't even appear online so we will always call and check periodically now, not just rely on the information provided on the utilities' websites. So that's a nice little $10 each month in our pocket. Will be getting onto all our other providers now.

  8. My budget is an excel spreadsheet but it consists of two sheets. The first page consists of a few lines, mortgage/rent (this figure is weekly, fortnightly or monthly depending upon pay cycle) then a line that says bills (this figure is auto linked to the sheet 2 of the document - more later on this) food, petrol, entertainment, holiday and/or emergency fund. So this page is small and has a total figure required per pay (ie weekly, fortnightly or monthly). The next page/sheet is the bills worksheet and this figure automatically links back into the first worksheet as you adjust your bills figures. This bills page is divided into months at the top and down the side is a list of the bills. This needs to include everything related to bills. Phone, Internet, house/contents insurance, car insursuranc, life insurance, water, rates, electricity, gas, health insurance, drivers licence renewal (these are costly but only every 5 years so be aware which year yours is due) repairs and maintenance, car maintenance/services/tyres etc, I also include a figure for Christmas presents (Santa and family) Mother's Day and Father's Day presents, birthday presents for family (immediate and relatives) I also include a line of kids party presents (as my kids get invited to birthday parties) school books, school uniforms, school shoes, sports activities (my son plays afl and my daughter has done netball during the year) all these things get out in a $ figure in the appropriate month or if I allow $500 for Christmas I divide this amongst each month same with emergency funds. It's is totalled two ways each column is totalled at the bottom and each column is totalled horizontally. Once this total yearly figure is calculated underneath that I have a line that divides that figure by either 52, 26 or twelve (I do mine by 12 for a monthly figure) then I link this figure back to the bills figure in the first page/spreadsheet. Having this linked means it's always updated if you reduce your bills/expenses or if you need to add something in. With this method it is the same pay distribution every month and with the bills spreadsheet you can see which months you are going to have a shortfall or or under. Usually the month you bought your house or moved house is large because insurances, electricity, water rates etc is due. I have used this method for many years and it's great to see the year ahead knowing when things are due. Regards Kathy A, Brisbane

    1. This sounds like a great idea Kathy. Are you able to upload a template here?

    2. Hi Emma, sorry I don't think I am able to do that but if you know how to use Excel you can do one up for yourself. Excel is pretty simple even if you haven't used it and there is icon for the "link" to the next page of the spreadsheet and I'm sure google can help too. Just hand write a list of all your things you are going to spend money on in the year (ie all the bills) as I've mentioned if you get the newspaper delivered each week put that in even if it's $15 a month as it's still an outlay and it needs to be included. Think of everything outside of "food", entertainment (your allowance play money to buy what you want) "petrol", mortgage/rent, holiday, emergency fund. Everything else gets dumped in the "Bills" spreadsheet to be linked back to the total income each month. Regards Kathy A, Brisbane

    3. I had a few big expense months that didn't suit my budget, so I paid 6 months of house insurance and 6 months of car insurance and that moved the big expenses around to other months,and then you just pay them 12 monthly from then .

  9. we are currently debt free (Thank the Force!) I have ONE credit card (I use it because I receive an additional 30% off sale prices and also I am rewarded with 'Kohl's Cash' (which I used to buy more gifts - or used as a gift itself). I paid my card off (comfortably) last week :-D
    I also xmas shop ALL year long - taking advantage of sales (I have 3 sets of body lotion/ body wash set aside for gifts at 75% off!!!) By spreading the gift buying out all year long (and taking advantage of mega sales), I don't have a huge out-lay of cash in December!

  10. I have always been very reasonable regarding debt; and have a lot of control over what I put on a credit card: Sometimes, though we do not have much choice when we need something and don't really have the means to pay cash for it. o instance, my old vacuum cleaner died, and I did need a new one. I believe in buying the best one can afford, even if it is a bit dear so that it lasts for years.. No sense in getting a cheap vacuum that will break down in a year's or two time. I bought a rather pricey one and put it on the card. Now, I do have to pay attention to that for the next three months or so; so no extras, that was y extra. But I tend to follow Elizabeth Warren's advice of dividing my pay into three categories: How the 50-30-20 Budget Works

    The 50-30-20 budget divides up your after-tax income, or net pay, into three categories. Essentially, your paycheck is portioned out (by you) as follows:

    50 percent for needs: Needs include any expenses you cannot forgo in a given month, like your rent, groceries, and minimum payments on credit cards, mortgages, and auto loans.

    30 percent for wants: This might be about the most surprising part of the Elizabeth Warren’s budgeting rule, as a greater portion of your income is allotted to “extras” like going out to dinner or a concert.

    20 percent for savings and debt: Interestingly, for many first-time 50-30-20 users, saving money and paying down debt — which so many personal finance experts emphasize as a priority — takes the smallest portion of the cake. In addition to growing savings for an emergency fund and retirement, this section also includes extra payments toward debt. The 50-30-20 rule not only makes sure you aren’t spending all your money on fun or living expenses, but it also makes sure you are saving something for a rainy day — 20 percent really isn’t that much for debt repayment and savings.

    This method works well for me, because you can pay off debt and not feel so deprived that you get careless when discouraged after paying all of those bills, and end up spending more. It definitely works.

    I recommend it.

    1. Of course you have choice. If you would have had a basic reserve you could have replaced that item. If your percentage for wants is 30% most certainly so!
      I myself HAVE to spend 80% of my budget on needs, even after scimping on everything. The other 20% go to saving. I have a bottom line figure that HAS to stay in reserve and a figure above that that you could call my WANTometer. Once my savings pass the wantometer I sometimes use them to fulfill a want; never one a whim, always after careful consideration. For such things as taking a train trip to go stay with longtime friends and maybe visiting some musea when in their town. Never wanted a credit card and never been in debt in my life, even though I have lived below the official poverty line all my life.(Due to ill health).

    2. I choose to save my basic reserve for something else a little more important. I can easily afford the limited payments, and all will be paid within 90 days. It works for me; and I am not in debt otherwise. Thanks, but I have been poor most of my life and manage very well. If this does not work for you, then so be it. It does work for many I have pointed this this out to. And they seem happy with it. I, too, weigh things carefully, but have a credit card for emergencies; not whims.

    3. hopflower, is there a website where one can read more about this plan? I do not follow how the categories are arbitrarily assigned 50-30-20. If one has a certain amount of pay, and one's needs are already known, what happens if the needs come to more than 50% of the paycheque? Thank you.

    4. Elizabeth Warren is the senior senator from Massachusetts. She has written several books on how Americans live and how our standard of living and way of life is being threatened. Her guide is one that makes sense; but of course must be followed to suit one's own circumstances. The idea is that most budget plans are so austere, that people often drop them out of a sense of feeling deprived, and not being able to do anything pleasurable. Her books are sold on Amazon, and the name of this one is All Your Worth: The Ultimate Lifetime Money Plan. I often reverse the portions, and spend only the smaller amount on pleasurable pursuits. But not allowing room for any of this in a budget can get very discouraging quickly. Sometimes I don't spend anything on myself, but at least I know there is a small budget in place if I am so inclined. That way I can pay my bills, save something, and once in awhile have a choice of a treat.

      I hope this helps. You might find it interesting. I notice that some people do budget in a bit of pocket money. This is something on the same lines.

  11. For the past year, I've been tracking every penny spent in a computer program called "YNAB" which is short for You Need A Budget" :) I paid for the program (but got a 75% off deal!) and have found it to be a great tool for seeing where we can cut back on expenses.

    Typically, I use as few appliances as possible since I've found this to be a tangible way to reduce costs. No dishwasher and I line-dry unless there's a blizzard or it's a load of cloth diapers (which just get too stiff on the line). It's amazing how much running the dryer costs. Our utility company is always raising rates, as much as 30% at a time, depending on the season. So I do whatever's in my power to give them as little money as possible. As an aside, I find it interesting that people seem to think I'm depriving myself of all this convenience. I see it more as depriving the utility company of our family's hard-earned cash ;-)

    I'm eagerly reading everyone else's ideas - like so many, our income has actually gone down, while the price of everything keeps going up!


    1. We are like peas in a pod, Jaime. I think "convenience" has created many of the environmental problems we have now. I do without as much as I can and like you, have no dishwasher and always line dry.

    2. I love YNAB. We downloaded the free trial and I figured out what I liked about it and what I didn't. I then created my own spreadsheet using some of their principles, but making it more Meredith friendly!

  12. Hello All,
    No, take away food or coffee for me this year. This time last year I reduced my hours at work and went back to university to finish my degree full time. Which was fun but hard work. By August my manager wanted me to do 45 hours worth of work in 25. Enough was enough and I handed in my notice. That's when my emergency fund kicked in to help sub the small student allowance.
    Then family called and I needed to go back to the UK for 3 weeks over Christmas. Now I have a credit card debt hanging over me. Its a shame I didn't have 2 emergency funds!
    When reviewing my budget at the end 2014. I was flabbergasted to find that what I had spent on 'Eating Out' (coffee,lunch, alcohol, take away) give or take, equaled my trip. I know that the next 12 months will be hard but the feeling of being debt free will be worth every missed coffee date and quick catch up over a wine and I have found some casual work to help reduce the debit quicker without effecting my studys.
    My tips
    1. Set a realistic budget. I now buy 1 coffee a week and use it to met a friend for coffee. It is cheaper than meeting them for a wine.
    2.When the weather is nice suggest meeting friends for picnic. Treat it will a pot look.
    3. Be honest when you can't afford something. We all earn different amounts. Your true friends are interested in you and will enjoy your company without the need to spend money.

    Rhona you have given me lots of guideness over the years Thank you.

  13. We have a gas stove, and I do most of my cooking on it, as oven (electric) costs a lot to run. I own just few kitchen appliances (bread maker, rice cooker, food processor, juicer and a blender) and I bake my bread at night. Also, I programme my washing machine for night, as our electricity is twice as cheaper at night. My husband always gets dinner's leftovers for next day lunch to take with him to work, and I cook for my children simple nourishing meals, using grains+vegetables formula, porridges and soups. We try to be more or less vegetarian, my husband does not mind, if it tastes ok, but sometimes he still tops up with meat, as vegetables leave him feeling hungry. No pork in our family due to ethical reasons (most of it comes from factory farms) and we allow free range chicken and lamb into our diet if we need some meat (lamb is pretty much free range in NZ). We do not have a dishwasher or dryer, I dry clothes inside or under the roof outside if needed. Our electricity consumption is still high, hot water cylinder "eating" most of it. We tried to experiment by turning it off during the day. But it cools down (it is insulated!) and for a family of 2 adults and 2 children we do not have enough hot water by the end of the day. Most of our income is going to cover mortgage and insurances. We manage ok on one income, but it is just because we are saving constantly where we can.

  14. Our road to financial recovery was long indeed. Our first step? We automated our mortgage payment. When you have no control over whether it gets paid on the 1st or the 14th, you will make sure the money is in your account. Our mortgage company allowed a 14 day no penalty late payment. We got paid every 2 weeks so twice each year we got 3 paychecks. So we would fudge that mortgage payment toward those months and never got ahead. Second, we stopped eating out. period. For 3 years, we cooked at home and we cooked cheap. We put every spare penny to paying down debt. And when one was paid off, we rolled that payment into the next one. It was a very unpleasant 7 years to get rid of all our debt (except mortgage). In 2000 we began tracking every penny in/out. We still do it today. Awareness leads to mindful choices and then expenditures become a pleasure not a stressor. Do NOT "upgrade" on borrowed money. For instance, if you want to replace kitchen countertops, save up cash. By the time you hit that total, you may well decide what you have is just fine. I believe the hardest thing we do is determine what is a need and what is a want. Cable TV, cell phones, new cars, these are not requirements for survival although many would argue that. They are "nices" and "wants". To quote a dear frugal friend "Now that I can afford broccoli, I would rather grow it myself". At the end of the financial worry tunnel, you too can make that statement. It is a journey and destination worthy of your attention.

    1. Elle, your story sounds exactly like ours. I like your comment "awareness leads to mindful choices". I completely agree.

    2. Thanks for that great post Ellie.

  15. Here is my money saving step I took last month. Hubby and I hae always wanted to go on a cruise or a big holiday overseas. EVerytime we saved some money some appliance would break down and we'd have to use it for replacement. Anyway last mont I decided to do something about our depleted holiday savings, I opened up an account in another bank from our usual bank. I chose an account with no access card and can only be operated over the internet (I am sure one is allowed to bank into it by going in the bank for thosse who havent got internet). If you take money out it will cost you $2.50. So I do internet banking and each payday I "pay myself", I commit $100 per week to this account. I also have a house account I send money to. I was delighted to see that after a month that 'secret' account had $1000 in it. okay that was more than $100 a week, I was putting in left overs into that account when we had it. Also those $1 and $2 coins that I hate in my handbag which makes it very heavy, was squirrelled away into that account as well

  16. We are lucky to be free of loans and a mortgage but we are still careful with our money. We always put some aside each month as savings and/or unexpected expenses money. When we have to renew insurances we always contact other companies to make sure we are getting the best deal. We have worked hard to reduce our energy bills by being mindful of our use and making our house as energy efficient as possible. We buy some food in bulk, although this means a larger outlay initially overall it is a saving, I have found a shop which will order specific items in bulk for me so that I don't have to make one large order at a time and can just buy things when I am running out. Don't go shopping unless you need to and always with a list which you stick to!

  17. I would love if you could list a few weeks worth of vegetarian meals. Most of our money does go towards meat each week. You have given me many great idea's.

    1. Vegetarian meals in our home include: spinach/silverbeet & ricotta parcels, quiche, zucchini slice, vegetarian lasagne (made with 4cups of whatever veggies are in the fridge or garden) and risottos. I also do a pasta bake sometimes with pasta, veggies and a tomato based sauce that's topped with cheese and baked. Very easy!

  18. I paid off my mortgages early / saved for the down payments by keeping my priorities at the front of my mind: "Do I want a new dress, or a house; do I want take away dinner or to be able to leave my job, etc." I've lived completely debt free for 7 years and retired at 51. Putting a visual reminder on the fridge door helped a lot - seeing the progress I was making kept me motivated. I used to 'hate' cooking - but I'm thinking now it was mainly because I didn't know how. Doing the 'work' of food prep was less rewarding when I wasn't certain how it would turn out. I'm not certain now exactly how things will taste, but I am confident it will taste good! Learning first how to substitute things in recipes then led to experimenting and being able to cook from scratch without a recipe. That confidence makes cooking seem more like a creative endeavor than a chore. I think attitude matters hugely as well. If I live frugally and feel sorry for myself, resenting all the things I can't afford and think I'm entitled to, that's a miserable life. If I think being frugal is a creative outlet and an intellectual challenge that lets me get free of debt and ditch a horrible employer, that's empowerment. I think helping people find that new attitude is one of the best things you do here, Rhonda. Once a person has that frugal outlook, they can find tons of information and ideas about how to cut costs.

  19. I'm a believer in all of the little things, and also in taking extreme measures when necessary. For example, when seeking to get out of debt I advise people to give up purchasing organic foods, pastured meats, etc. Some people balk but the stress of debt is far worse for one's health than a period of time eating non-organic. I also recommend going to the very basics with produce; it is winter for us here so we eat a lot of cabbage, carrots, broccoli, etc. I don't think it makes sense to buy summer fruits and vegetables in winter at outrageous prices. For those who are truly motivated I suggest giving up animal products completely; a diet of in season vegetables combined with basic staples such as rice, beans, etc. is as cheap as can be. Learn to make bread, tortillas, etc. Drink water exclusively, or perhaps water and tea (buy it loose in bulk or find a bagged tea that is inexpensive that you like and never ever pay for bagged herbs teas as loose is super inexpensive). Have soup and bread for a meal at least once a week. Eat a lot of rice and beans. Don't give gifts, or give things that you already own. Make greeting cards or send electronic greetings. Shop thrift and op shops. Repair rather than replace; get creative with clothing repair and make your repairs decorative so that the items are even better than before. Walk and cycle if you can. Learn to be happy without paid entertainment (give up the idea of "entertainment" and create a life full of experiences that bring you deep contentment vs. fleeting enjoyment). Build up the basic emergency fund and then think about purchases that can help increase income or decrease expenses, such as a sewing machine, bicycle, stand mixer or bread maker (for those with arthritic hands), chest freezer, clothes drying racks, etc. Over the years we cut expenses so we could purchase bicycles and a cargo trailer, a grain mill and bread machine, a rice cooker and Instant Pot (pressure and slow cooker), a sewing machine, food safe buckets and gamma seal lids for bulk storage, drying racks, a chest freezer, etc. and we find our expenses getting lower each year as we are able to do and make more and more for ourselves. Sew curtains, knit dish cloths, make your own cleaners, improvise, etc. Most of all, give up cultural ideas of appropriateness! Don't worry if your plates or flatware don't match or if you don't have 8 identical drinking glasses. Don't buy into the idea that you need "this year's" fashions. Don't believe that children all need their own bedrooms and that you need multiple communal rooms in your home. Don't be embarrassed by driving an older car. Don't buy into the idea that you need an arsenal of anti-aging skin and hair products. Most of all, don't let anyone (especially the marketers) tell you that buying something will make you happy!

    1. Sunshine Alternative Mama, I agree with every word you wrote. We too find our expenses are slightly less each year because we make more at home and we voluntarily go without. We're so far removed from mainstream now, we don't know what "normal" is. It feels good!

    2. Yes, love all these ideas and do many of them. In addition, make friendships your entertainment. I love gardening and canning with friends, pot lucks, lunches rotating at each others' homes, book clubs with books from the library.

  20. Our favorite thing to use is coconut oil to cook and moisturize with. We buy ours at Trader Joe's for $5.99 or at Marshall's which always has a variety of them on sale. I have learned that with cooking, if you do not have a certain ingredient, say a carrot to throw in the soup, it will still taste good. Don't let yourself be dictated to by a recipe, look at it as guidance. I have baked things without sugar and they still tasted yummy.
    One thing I learned this week at the ripe young age of 45 is to not throw my underwear into the dryer. UI was buying cotton ones from Fruit of the Loom and Hanes, but they were not lasting at all so I 'splurged' on better ones at Marshalls. Now I line dry them and what a difference. So if you can avoid the dryer for stuff, go for it.
    Ask the library for their magazines when they have to switch them out. Most likely they will just give them to you. Our library also puts free books out after doing books sales to raise funds which is really helpful to folks as well.
    Some store brands of products are better than others so give them a shot. Trader Joe's and Wegman's have never disappointed. I can't say same for Shop Rite.
    Here is a little tip. If you love chai lattes from Starbucks, you can buy Tazo Chai mix in the container at most stores for as low on $3.99 when on sale. http://www.tazo.com/Product/Detail/39 You get about 8-9 drinks out of that one container for the cost of just ONE drink form Starbucks. Pretty awesome.
    Funniest thing I can share is when our cat was alive and we needed Frontline for her and the dog we would order it from Australia because it was cheaper than buying it here in the States. So yeah, make your price comparisons global because you never know.

  21. My comment is to help stay out of trouble next year. Start setting aside 1/12 of what you need for next year each month. I keep this as a running total in a ledger and the money just accrues in our checking account. I keep a small notebook in my purse with the names of those we buy for and space to record gifts. As the year goes by I can purchase as I see something I think would be appreciated or is an extra good deal and the money comes from what is in the Christmas budget. We have done it this way for many years and it keeps us out of trouble.

  22. My partner works as a School Learning Support Officer, which means that we don't get a pay over the school holiday period. So each fortnight I put $30 into a ubank (online banking) account, so that when school hols roll around, we can still keep the same standard of living.

    I also save for Christmas and Birthdays throughout the year - we put x amount per fortnight into another ubank bank.

    And the same for all our other needs - costs are broken down and each fortnight money is put into its relevant account - yes that makes for a LOT of accounts, but it also means that we know each account has a designated purpose and are less likely to dip into it, then we would if it was just a generic 'savings' account.

    To give you an idea we have a:

    Land deposit acc
    car exp acc (rego, repairs etc)
    activities acc
    school hols acc
    food co op acc (every 6 weeks we order from them, usually for substantially less than a health food store)
    gift acc
    general savings acc
    family expenses acc (hair cuts, clothes etc)
    My personal savings
    partner's personal savings
    bills acc
    money aside for youngest acc
    holiday acc
    and - large purchase acc (eg we want a new bed, a good quality juicer etc)

    We also pay our electricity bill off fortnightly - I put $80 each fortnight and we are almost always ahead each time the bill comes in.

    The rest of our money goes towards groceries, youngest child's pocket money and activities and fuel.

    I have a little piece of paper which tells me where all the money has to go, that I stick up on the wall in front of my laptop so that each fortnight the banking and bill paying is easy.

    Other things we do to try and save a few $$

    harvest rainwater
    grow our own fruit and veg
    turn EVERYTHING (except fridge/freezer and main phone) off at power point every night - yes that includes the computer/modem/tv etc.
    make our own laundry detergent
    buy our staples in bulk when they are on sale - eg we like to use the same dish detergent Rhonda recommends, but we wait till it is a bit cheaper and then will buy 4 or 5.
    Make our own snacks
    cook from scratch
    rarely get takeout (would like to NEVER get takeout)
    buy what we can second hand - garage sales/opshops
    Make things last as long as possible before upgrading
    line dry (which is still the standard way to dry here in Aus anyway I think)
    stay away from the shops
    only get groceries once a fortnight

    Everyone is different and has different needs, so it's great to see all the creative ideas we can come up with - something is sure to gel for everyone.

  23. We recently held a very successful garage sale, we involved our adult children, friends & neighbours. This gave a great variety of goods, our family color coded price stickers (1 cashier kept note), friends had their own tables, & signs pointed down the neighbours driveway's. It took time to organise our bits & pieces however, the results were well worth the time & effort. Some leftover goods were pre & post sold on the local garage sale sites, & the rest has now been donated to the local charities.

  24. My husband and I are about to celebrate our 22nd anniversary. We've been living in a home and paying a mortgage for all those years. We had to move once for a job, but we should soon own our house outright and have no debt. We have been putting extra money into a mortgage every month. We have also saved for retirement and our kids' educations first. One thing we have never had is cable TV. We use the library to take out lots of DVDs and books. We do have an internet connection and use that for a satellite phone connection that's very inexpensive. I bet we've saved about $100/month, at least, over all that time. $100 x 12months x 22years = $26,400. In our old house we shoveled our short driveway. At our new house, we have a long one. After we got a crazy estimate from a plow company (about $40 for a small storm, over $100 for a large one), we went out and bought a good snow blower. I bet it has saved us $1000s over the last 5 years. We make lots of calculations like this to reduce expensive bills that just keep coming. This year our son has gone off to college without having to take out loans.

  25. My suggestions for anyone desiring to reduce debt are simple. 1) I would begin to pay off the smallest debt first. This will be an encouraging factor to continue. Then take the next. OR try to put all debt in one loan at a reasonable rate - if you can. There will be just one interest charge this way. Discuss and research which way will serve your family best, 2) Use the envelope system and cash only unless you're paying a debt. Example: Put money to pay loans in an account, but keep cash for expenses such as food and clothing. 3) Take some time to use sales and coupons on purchases. It's time well spent. About four years ago I had very little cash for Christmas. I bought so much with just a bit over $300.00 for 14 people in my family. 4) If you want an item, set an amount you can realistically afford for it. Then be patient and keep an eye on the ads.


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