Two years on ....

Last reviewed my budget at the end of 2009 and think it's timely that I review and see if I have made any further improvements as I 'battle' with myself when it comes to money :)

5 things that I was proud of in 2009 ...

1. Travel budget - I am happy to report that I do have a healthy travel budget as I put a side a small sum each month for when I do travel (usually middle and end of year). To date, all travel expenditure comes from this budget and I didn't have to tap on my other budget for that. So that will continue as the amount put aside seems to work. For 2012, what I have done on top of this, is set up an ad hoc project fund. This year, I have set myself a travel goal and for this project, I have allocated an amount that I need to raise. So for 10 months, I will need to put a certain sum aside. After the 10 months, the money can be reassigned for other purposes.
2. Reworking the budget - I have realised this will be something that I will need to constantly do with changing circumstances. There is no such thing as a fixed budget for me. At the end of every month, a do a mini review to see if any minor tweaking needed. For the major reshuffling, it will be done every six monthly.
3. 6 months reserve - I did not understand before how anyone would be thrilled to see the numbers change (increase rather than decrease) each time they update their bank passbook. But since I manage to put aside some savings, I get that same thrill each time I update my passbook. I know it's old school to be update passbooks when I can easily see what I have when I do online banking but it just doesn't feel the same. I have no idea why. What I have done instead is set a yearly target for myself (e.g. 10k increase each year) and when I get any bonuses, that will go straight to this account. Seems to work for me ....
4. Fun savings - I started with the fives (where I put five dollar notes that I get as change aside as savings), then I started with them gold coins (one dollar coins) and now I have also put aside fifty cent coins into another coin banks. I seem to have more coin banks then I have coins!! Three at work for the gold coins and one currently for my fifty cent coins. Wonder what's next ...
5. Zero debt - Am glad to share that I have managed to maintain a zero debt for my credit cards. They all get paid at the end of the month. Tremendous satisfaction when that happens. And I may at times need to readjust my monthly budget to ensure that I maintain zero debt and it also means a little tighter for my fixed expenses ... but it has to be done.

What about the three things I said I could do better? Have I managed to do that? Let's see ...

1. Pay myself first - I wanted to put aside 20% of my salary to pay myself. This money should go into my 'reserves fund' but somehow, I am still not able to do this because I have set up different 'funds' for permanent or ad hoc expenses. This is definitely something that I need to rethink ... wish I had an expert to help me out here on this.
2. Shop uncontrollably - it's in my DNA I swear. I must admit that it wasn't as bad as it was before and I still have to tap on my reserves fund to pay off the bill but I made sure to repay the 'loan' to self asap. I rather have a loan from me than the bank. Last year, I placed a 'bag ban' on myself. I am a bag lady and I love my handbags. Because of the ban, I had hoped that I would be able to save some money. Did that happen? Nope. I ended buying other equally expensive items like jewelry instead. I realised that I can't deprive myself of shopping because it brings me extreme pleasure so instead will have to ensure that I spend when I have the funds - that means saving up for what I want. Tuff one there.
3. Budget control - yup, still have problems trying to stick to some of the items on my budget especially for food and 'miscellaneous'. Have re-tweaked my budget and will continue to do that.

Looks like I still have quite a bit of work to do. Hmm, what about goals for 2012 (on top of those three stated above)? Definitely something for me to think about ....

Looking back on 2009 ...

It has been a while since a post anything here due to work commitments. For this post, I want to look at three improvements I am proud of and three things I could do better financially for 2010. Yeah, kinda of like a review of my financial status for 2009 *grins*

5 things I am proud of ...

1. Started a travel budget and for 80% of the time, I was able to stick to the budget. The other 20% was because of unplanned travelling for work that took place at the last minute.
2. Reviewed budget several times throughout the year to ensure I had one that worked well for me.
3. Have a decent enough savings for now which is slightly more than my 6 months reserve.
4. Have started another form of fun savings with the Money Ox Bank where I feed it with any gold coins that I get from change back.
5. All my credit and charge cards get paid off at the end of each month. I do not roll over any debts to the next month. So each month, I am at zero debt.
   

3 things I could have done better ...

1. Still am not able to pay myself first and save 20% of my salary for what I like to term 'pure savings'. Currently, I have two funds - emergency funds and ordinary savings fund but these have been tapped on for expenses that were not budgeted. What I would like is to have a proper 'pure savings' find to add on to my reserve savings (which is where I put in the extra money I get through bonuses etc which is not on a regular basis).
2. I still get urges to shop uncontrollably and there have been times when it has been pretty bad and that's when I would have to tap on my ordinary savings fund which I am not too thrilled about.
   
3. There are still areas in my budget that I have not gotten under control - one is my food budget where I am still spending several hundreds on top of my monthly budgeted amount. The other area is what I term miscellaneous budget which is not good because it's basically unplanned spending. Towards the end of the year, I did try to list down expenses which are tied to different months - birthdays, anniversaries, Christmas - where I need to put aside more money for those months for such expenses. Am still trying to improve on this and will continue to do so in 2010.

Why say no to a discount ....

I was at at my service provider to get myself a dongle that would allow me to go online anywhere and everywhere (or at least that's what I was promised) and though it meant adding on to my expenses each month (came up to about S$37 monthly), but it also meant that I could go online easily. Am also going to wean off my mobile online access soon since purchasing the dongle. I just need to check if there's any penalty if I end it now and if there is, how much it will costs versus the costs I have to pay to maintain that service.

This brings me to the main thing I wanted to blog about. While getting my dongle documents ready, the girl who helping me with it checked my account and spot that my cable tv contract has ended. I am currently paying about S$56 monthly for that after the contract expired (which I was surprised I didn't even realised!!) and asked if I would like to renew the contract which would bring my monthly payment down to about S$44 monthly. Not much difference you might say but any savings is better than none. Just have to make sure that the amount I 'saved' is actually saved. Meaning, I need to actually take that actual amount (difference) and stash it into my savings funds. If I choose to use it for other expenses, then it's not actually savings.

What that trip to my service provider made me realised was that I need to be more aware of my contracts. I have usually taken it for granted that when my contract ends, it's no big deal because my services don't actually get disrupted. And after many years of using their service, I pretty much know I am not going to end the particular services so might as well enjoy some of the benefits that come with having a contract. I guess it would be different if you are not sure if you want to stay on with the service provider for two years then you need to check what is the penalty if you terminate the contract before the two years end.

I know that for my mobile, when my contract is due to end, they would usually send me vouchers to be used for a new mobile and somehow, mobile phones these days seem to last as long as the contract and by two years, I usually start having problems with my phone so timely to use the vouchers as I hunt for a new phone.

But to think of the savings that I could have gotten if I had paid more attention to my contracts and when they expire. As service providers are keen to get you to stay with them, they are bound to offer some 'goodies' to get you to stay. That's for one group of people. There is another group, who like me, no clue when their contract ends, so the service providers don't really have to bother much with us because with an opt out system, we aren't going anywhere anyway (too much trouble to set things up with another service provider).

I do admire my friends who are constantly checking which providers offer better deals and they would actually move around after each contract ends. For me, I cannot be bothered to do that but I am wiser now. Since I am going to hang around the same provider for a while, I better find out what I am getting in return for being so loyal. What about you? Are you being rewarded for sticking to the same service provider all these years? May want to go check it out today! :o)

Saving for something ...

This is a relatively new concept for me - savings. I remember as a child, my parents encouraged me to save. We had representatives from a bank coming to school and as I kid, I brought money to 'buy' stamps that went into my account book. Guess that was how they taught us how to save as kids by making it fun. But other than that, I don't remember any lessons on financial literacy and adults just kept saying that I should save, save, save but never how.

And it's only as an adult, I am learning how to save. And it's been a painful process. But thankfully, am in a situation that I am able to put aside some money each month from my salary. I still have not figured out exactly how much I should save. I started at 10% and gave myself a goal to increase the amount to 15% of my salary at my next pay increase. And this April, I managed to increase the amount to 15%.

I have mentioned before that I set up separate bank accounts to help me organise my money better and am able to save properly. I have different funds such an as emergency fund, and ordinary savings. I also have the 'five dollar' savings and my 'gold coin' savings in my Ox Moneybox. Recently, included travel fund. I have never travelled using cash. Past practice has been to sign on my credit card for the trip and while on the trip, continue to sign on the card. Then I would pay it off slowly, while accumulating the interest.

What I have done now is identify a place that I may go at the end of the year and then work backwards to see how much I need to put aside each month. This is where it gets tricky, what if I cannot put aside enough money by the time it's time to travel? Do I postpone the trip? Should I tap on my ordinary savings?

I know I shouldn't tap on my other savings since I have put aside a separate budget for travelling. I wouldn't want to cancel or postpone the trip because I can only travel during certain time of the year due to work. Then it would make sense to consider another trip that I can afford. With the economy not fully recovered, travelling to nearby countries would make good sense.

So what I am doing now is preparing three plans for three different places I can consider travelling within the budget that I have figured out. There is a travel fair on this weekend, that could be another place to check out for great deals. Am really looking forward to travelling and it will be even better when I can afford to travel with money set aside for it.

Auspicious way to save money ...

I have been looking for an ox money bank for the longest time (okay, since this year's Chinese New Year) and I finally found one last weekend. I think they were clearing stock (probably was sold during Chinese New Year with 2009 being the year of the Ox and all) because it was cheaper than the original price. So grabbed two - one for my friend's birthday (which was in May but I had this in mind and didn't see it til now so he had to wait) and one for myself.

Why is he getting this money bank? Well he's born in the year of the Ox and I read one of the fengshui book that what will bring him wealth is an ornamental ox with money or wealth symbols on it. This one fits that perfectly! Was definitely worth the wait - three whole months!

As for one for myself. I am born in the year of the Rat and my secret companion is the Ox, and an Ox is suppose to bring me luck. So this is meant to bring me luck and hopefully wealth *grins* Yeah, pushing it a while but why not.

We have decided to put only 'gold' coins in this, 'gold' here refering to the local one dollar coins. This is another way (other than putting aside five dollar notes) of saving made fun! These days, I have to think a little bit more when I pay for anything so that I can either try and get back five dollar or one dollar change. Let's see how long it will take for me to fill up the money bank and any guess how much I can collect in one Ox? Here's to the Year of the Ox!!!

What is your purse-onality?

I recently finished reading Sheconomics by Karen Pine and SimonneGnessen - easy enough book to read and got some ideas from the book that I am going to try out. There was an interesting bit about what your purse say about you - moneywise at least. So am sharing it here for your reading pleasure ...

Does the style of your purse reflect your attitude to money?

• Is it smart and business-like?
• Funky and frivolous?
• Is it maybe a bit young for you (and reflects an immature attitude to money)?
• Or is it a designer copy because image is all-important?

It's a green patent croc-print Furla purse that I got during a sale. It's not a high end luxury or designer item, neither is it a designer copy. It's a little funky to be cause it's an unusual shade of green and the croc-print is not too 'mature' looking either. For me, it's not about spending a lot of money for a purse just because of the label, but rather buy an item of quality so that I can use it for a longer period of time, instead of keep replacing them, as I may need to for a cheaper, lower quality purse.

Are the notes crisp and stored flatly, all facing the same way? Do you have them in order, lower denominations going up to larger ones?

• Or are they just stuffed in, jumbled with receipts, tickets and old shopping lists?
• How much clutter is there?

Looking into my purse now, my notes are flatly stored and I usually use the older looking notes first. They are facing the same way and are in order, starting with the lower denominations, ending with the fifties. I used to have a lot more receipts, tickets etc. But in the last few months, I have been clearing the receipts daily when I record my daily expenses. So that helps. But I still have other stuff in there that I can still get rid off (name cards of people that I meet, discount cards etc) that makes my purse still bulky (but much better than before).

Do you have a small amount of change?

• Or is it bulging with coins - perhaps because you break into a new note every time you buy something?
• Or have you never bothered to remove those foreign coins after last year's holiday?

I used to have foreign coins in my purse but not any more these days. I have different ziplocks for the different currencies from previous holidays which I keep separately from my coins in my purse. I don't have a lot of coins because I try to use them up first so that I do not have to lug them around. And it's nicer to have more dollar notes than coins in my purse!

Does it contain just one credit card and one debit card?

• Or have you got a full set - every type of credit card and one for almost every store you've ever visited?
• Do you have to perform a juggling act with them whenever you pay for something?

Before, I used to have several credit cards. But these days, I have one credit card, one charge card (which I will choose to use over the credit card since I will have to pay the full amount at the end of each month) and a debit card. I also try and use more cash these days, where possible. And if I sign for an item (because I may get discounts), I put the cash aside immediately so that when the next month comes and I have to pay for the bill, I already have the cash and do not have to dip into that next month's budget. Seems to work well this way for me. I wasn't able to do that before because I would normally not have enough cash in the first place.

Is there emergency proof?

• Is your name and address in your purse, to increase the chances of getting it back if lost - or even in the case of a medical emergency?
• Is only essential information kept there? E.g. PIN numbers are never stored with the cards they relate to.

I made a mistake some years back when I had the PIN number in there because I needed to transfer some funds. Biggest mistake ever because on the same day, somebody helped himself to my bag as well as the money in my account. Since then, I never put my PIN number anywhere in my purse. And I have my identity card in my purse, which I have to carry around anyways so it should be safe if anyone needs to identify me based on what I have in my purse.

Money confusion ....

I am puzzled. It has been a couple of months and I have not figured it out yet. I had a slight pay increase and the plan was simple ... in theory at least. Whatever increase I got from that will go into my savings. I have also managed to clear my credit card debts and always made sure I use cash for my purchases (as much as possible though I have slipped some).

But it's not working out like that because I don't seem to have that much extra at the end of the month! From my calculations, I should have at least about $500 extra but somehow, I seem to be using that up on unplanned expenses. Before the pay increase, I had some unplanned expenses too and I used up all my money by the end of the month. And with the pay increase, the same thing happens.

I think psychologically, I tell myself that with my pay increase, I should be able to spend more without it hurting my budget but I am realising that it is affecting my budget ... rather my savings. I am not happy with this state and will need to look into this immediately.

What I am thinking I should do is while doing my budget and putting aside the different amounts into the different accounts I have for different things, I should put aside the $500 extra that I should have at the start of my 'financial' month (that's when my pay comes in ... in the middle of the week) instead of waiting till the end of the 'financial' month. That way, I will just have enough in my bank account for things that I have budgetted for.

I am a little uncomfortable having just enough but I really need to learn to do planned spending. I try to stay away frm the stores these days cuz I don't know if I have the will power to resist the sales that are coming up.

I am also travelling some in mid-June and unfortunately, this wasn't planned and I didn't put aside money for this. Now will have to look at the figures and see how I can do the trip without blowing my budget *sighs* It's going to be tricky!