Friday, November 30, 2007

Getting Food Bargains

When you become cost conscious you start doing things subconsciously and automatically that you don’t even give a second thought. My husband said the other day “why did you buy so much bread ?”.

It took me a little while to respond but I eventually remembered it’s because the bread was nearing expiry, the grocer had discounted the bread to clear. I could buy 3 loaves for just over the price of one. I put 2 in the freezer and used the third for now.

I also do that with some cookies, cakes, butter (when making cakes), some fruits like tomatoes which when really ripe are the best for making my own pasta sauce. Sometimes I also find bargain bins where the grocers are simply wanting to move that stock out or it simply isn’t selling well so I always keep a look out for those specials.

Of course I’m not always at the grocers when specials are on but my trusty girlfriends might be ! So a quick SMS to the group sends us on a shopping expedition – no wonder my husband wants me to get rid of the cell :)

Thursday, October 4, 2007

Never Forget the Tough Times

Most people have gone through financially and personally tough times in their lives. We certainly went through a tough few years:
  • Failed Business Venture
  • Main income earner out of full-time work for more than 15 months
  • Mortgage going up instead of down (up $20K)
  • Credit card max’d out for over 2 years at over $10K
  • Accumulated line of credit personal debt of $25K that took 5 years to clear
  • Personal health of myself and my husband became very low.
  • Bouts of depression – we tag teamed on that one
  • Caring for a young child throughout – kept us focused on what really mattered in life
I don’t mean for this to be a depressing post and I want to show the great points that have become part of our lives as a result of the life challenges we faced five years ago. Here are some of them:
  • We learned to manage our costs really well
  • We bought in bulk and cooked in bulk
  • We cut wants such as cable TV and focused on what we really need
  • We focused on developing a really tight budget that was easy to use once it was made
  • We focused on legally minimizing tax liabilities for the higher income earner
  • We looked at alternate sources of income apart from our main jobs such as online businesses with residual or passive incomes
  • We sold unwanted or unnecessary items on eBay and the local fairs and markets
  • We eliminated several high fee bank transaction accounts by consolidating into one transaction account
  • We focused on paying our highest interest debts first
  • We changed our spending habits looking first for value and quality rather than just low cost
  • We cleared most of our debts excluding our mortgage debt and now focus on the mortgage as our pseudo-savings account (we have a redraw facility)
  • We focused on improving our physical and mental well-being
  • We spend more time together as a family
We focus on enjoying our lives now with each other and our families but we never forget the tough times because we prefer the better times :)

Wednesday, September 5, 2007

A Classic Italian Pasta Sauce Recipe

As I mentioned in a previous post Buy in Bulk, I like to make my own Italian Tomato Sauce. I’ll share my recipe with you and you’ll be surprised how simple it is to make. The key reasons I love to make this sauce are:
  • It’s absolutely delizioso (delicious)
  • It’s easy
  • It’s cheap and great value
  • I can make it in bulk and I can portion it and freeze it
  • It’s fairly quick to make
  • Fairly low in fat (except for the garlic bread, substitute for low fat butter)

OK, here are the ingredients you need to purchase beforehand:
  • 10 large ripe tomatoes or the equivalent in canned tomatoes
  • 1 large white onion
  • 5 cloves of garlic (we’ll make some garlic bread as well)
  • Tablespoon of olive oil / cooking oil
  • Salt and Pepper or Chilli
  • Packet of Pasta enough for your family
  • Freezable containers that can hold a family portion of sauce
  • Butter/Margarine
  • Bread roll suitable to feed your family and can be sliced too make garlic bread.
  • Aluminium foil to wrap the garlic bread and place in the oven
  • Parmesan cheese
  • A few leaves of basil

You’ll need a large deep pan to cook the sauce, a chopping board and an electric blender. Take the butter or margarine out of the fridge and leave it on your kitchen bench out of the way. Pick the ripest tomatoes you can find at your green grocer as they’re best for pasta sauce and usually cheaper because they’re close to expiry. Wash and with a knife remove where the stem attaches to the tomato. Cut them into quarters and place in the blender.

You don’t have to de-seed because the blender will blitz it to a liquid. If you have a hand blender it’s probably easier to wait until the tomatoes have been cooking in the pot for 10 to 15 minutes. Whilst blending you can season the sauce in the blender or wait until it’s all in the pot.

Clean and cut up the onion and chop into small cubes. OK, put the pot on the stove and place flame on a medium. Add the heaped tablespoon of oil in the pot and throw in the onions. Simmer the onions until lightly brown. If you’re unsure with the heat start on low and increase as required. Stir regularly. You should have at least 5 minutes so you can prepare the garlic. Take 1 to 2 cloves of garlic, peel and chop finely.

As soon as you see the onion going translucent or beginning to brown put in the chopped garlic and saute until lightly brown. Pour in the liquid tomatoes and turn up the heat to high. Add salt and pepper (and/or chilli) to taste. The sauce will require good seasoning to bring out the flavor. Stir well. Coarsely chop up a few basil leaves and throw them in the pot. You can taste the flavor when the sauce has cooked as opposed to simply heated – it’s a different taste.

Wait until the sauce has come to the boil and reduce the heating to a simmer – just bubbling along gently. Cook the sauce for approximately 45 minutes and stir regularly every 5 to 10 minutes to ensure the sauce doesn’t stick to the bottom of the pot. After 20 minutes check for taste and add additional seasoning if necessary. If the sauce is very thick add some water. Now get a large pot, add water and a good dash of salt and put on high heat to boil. Put the lid to boil more quickly.

Now we start the garlic bread. On a chopping board place the long thin roll and make cuts about half an inch from the bottom so the roll still holds together. Take the remaining garlic, peel and chop finely. Take the butter which has been softening and put about 4 to 5 tablespoons into a cup (however much you think you need to butter the bread). If the butter is still not soft enough, warm up the cup with some hot water or place the cup with the butter in the microwave for about 5 to 10 secs. Crush the garlic with the side of a large knife and chop it finely. Add the garlic to the butter an half a teaspoon of salt. Mix it up really well till it becomes spreadable.

Take the bread role you have sliced and using a knife pry apart each slice and liberally spread the garlic butter. Wrap in foil and throw in the oven (make sure you turn it on :). If the water has boiled put in the pasta and stir regularly until the water comes back to the boil. Read the instruction on the packet however it should only take to 10 to 15 minutes. Make sure you taste the pasta so it doesn’t over or under cook. By this time your sauce is probably close to ready.

Once your pasta is ready, drain off the water in a colander and then put back in the pot. Take a cup of sauce and mix it through the pasta to keep it from drying out.

Set the table, serve the pasta with some additional sauce and serve the garlic bread. Voila ! What a great meal. At the end of dinner, the sauce would have cooled enough for you to store in your freezable containers – put enough in each container for another meal.

Emergency Tips

If you’re cooking and you’re distracted by the kids, husband, phone etc and you burn the bottom of the sauce don’t panic. Take it off the heat immediately. Grab another pot and pour in the sauce. Most of the burnt sauce usually stays at the bottom of the cooking pot.

If you have over seasoned the sauce, simply don’t add any salt to the pasta. It will balance out. You just need to remember that until you use the remainder of the sauce you have frozen.

Wednesday, August 1, 2007

Saving For a Rainy Day

During my upbringing I was told to always put aside some money for a rainy day. It’s a logical thing to do however once I got married, Mr Finance told me to stop that and we should put the money into the mortgage. No I said, we should always keep some money aside for emergencies, for our holidays etc. Mr Finance said that was valid when I was single and no mortgage, which is now our biggest debt. Mr Finance produced a calculator so I knew I was in for a lesson.

Here is the lesson I received (NB Hubby Finance is not a financial planner and neither am I).

If you have spare cash and can make more money in an investment than your debt rate, then go ahead. If not, put the money in your debt. OK, I didn’t understand this so I wrote down some examples with some arbitrary rates.
  • Mortgage 6% interest
  • Credit Card 14% interest
  • Investment 10% return
  • Savings Acct 5%
Say you have $1000 spare cash. Where do you put the money ?

Example 1: Put $1000 in the investment

In a year you would earn $100 interest. Let’s say your tax rate is 25%, tax on $100 is $25, leaving you with $75. Credit card interest cost on the $1000 = $140. Mortgage cost on $1000 is $60. Net result of investment vs credit card (highest debt rate) = $75 – $140 = -$65.

Example 2: Put $1000 into credit card

Interest saved from credit card = $140. Mortgage cost = $60. Net result = $140-60 = $80 better off.

Example 3: No credit card debt, money into savings or mortgage ?

$1000 into savings, $50 interest – 25% tax ($12.50) = $37.50 less $60 mortgage cost on the $1000 = -$22.50.

$1000 into mortgage, $60 better off.

So, if our credit card debt is 0, instead of putting that $1000 or $100 or $50 into our savings account, I place the money into our mortgage and redraw the money when needed. I asked what if the savings interest rate was higher like 7% ? Back to the calculator:

$mortgage = -$60
$savings = $70 – 25% ($17.50) = $52.50 I’m still worse off by $7.50!!

Of course if the credit card has any debt we try and clear that first and then we use our mortgage account as our pseudo savings account. If there’s any flaw to the logic I’d love to hear your comments.

Thursday, July 5, 2007

Budget Planner

Budgeting as always been a struggle for me. I always associated the budgeting process to be associated with being poor or those that can’t handle their money – that attitude changed when I moved out of home and left mom and dad. Well guess what, when you get married, start a family and run a household you feel poor. The bills never stop and the expenses can run out of hand if you don’t make an effort to manage them.

My key problem has been out of site out of mind. For example when we were DINK (double income no kids) and both earning well, I used the credit card without even a thought of the ever increasing debt balance. When the credit card bill arrived it wasn’t a problem to pay the outstanding amount.

That had to change of course as our lives changed and we needed to budget. We’ll there was a slight problem – I actually didn’t know how. We’ll after some tears and some patient explaining by hubby that budgeting did not mean the end of our lives, we sat down and listed all our expenses and income. We broke it all down in weekly chunks so we could determine when the expenses fell due and when our income was received.

There were quite a few items so I knew I needed to list them or type into a spreadsheet. Hubby created a simple and wonderful spreadsheet that I can easily use and displays on one page our complete budget. If you want to use it you can download Mom’s Finance Budget Planner. It is very easy to use and has some conversion calculators built-in.

Friday, June 15, 2007

Buy in Bulk

I know it’s a cliche but buying in bulk really is a great way to manage your consumables and your costs. A lot of people focus on bulk food buying however then you encounter the problems of:
  • Where do I store the food
  • How quickly can I consume it before it perishes
  • Will I ever use the 100 cans of baked beans
I do buy in bulk however mainly non-food items such as:
  • toilet paper
  • shampoos, conditioners
  • soaps
  • detergent powder
  • nappies
  • deodorant
  • some canned foods such as tomatoes (I like to make my own Italian sauce)
The reasons I buy these type of goods are:
  • It saves me a lot of money
  • I can store most of these items outside of the house in the garage
  • It saves me time and energy when I do my weekly shopping trip as I don’t need to buy or carry and move them
  • I can buy some of the brands that I really like and still save a lot of money
  • I can save even more money on the no-brand products that I like
So one lazy Sunday afternoon I wrote a complete list of all the items that I buy for the house and family and chose the most suitable for bulk buying. I then did some research online, used the local papers and asked some friends if they knew of any outlets that sold in bulk and purchased as far in advance as my budget allowed. The next regular shopping trip was great because I didn't have to carry these items and could focus on buying best value for the rest of the shopping list.

Tuesday, June 5, 2007

Supermarkets Aren't Always Cheaper

When you have kids and need to do the weekly shopping it's generally easier to go to one place and complete all your shopping. Rather than visit many shops within a shopping complex I used to visit just one large supermarket thinking that as a supermarket chain I would be getting better and best prices.

Well one day I visited an Italian delicatessen looking for some cookies I couldn't find in the supermarket and whilst browsing I noticed that the pasta was much cheaper as well as the sauces and cheeses. I was shocked at the large difference in prices and after chatting to the proprietor discovered they were buying from specialist suppliers that could buy better than the supermarkets and pass those savings onto their customers.

That experience encouraged me to visit all of the specialist food stores in our local shopping complex and found some cheaper and some more expensive than the supermarket chain. Overall I was able to save between $10 and $50 dollars by buying from different shops. The only drawback is that it takes me an extra hour to complete the weekly shopping task but the money savings are well worth the effort.

Saturday, June 2, 2007

Another Bill - Don't panic !

I used to panic when a bill arrived because we usually didn't have the money in the bank and had to pay by credit card. By the time we paid that bill off the next wave of bills arrived. No more thanks ! We sat down and tried to work out the best way to put aside money for our expenses without spending it before the next expense needed clearing.

Firstly, we pulled out the previous bills for the last 12 months and calculated the totals and divided by 52 weeks to give us our base weekly expense figure. Mainly the big ticket items such as:
  • Water
  • Electricity
  • Gas
  • House Insurance
  • Car Insurance
  • Medical Insurance
  • School Fees
  • Land Rates/Tax
  • Telephone
Once we had this figure $X we added an extra $20 for variation and increases. We then opened up one of those online only, high interest savings accounts and linked it to our transaction account where our wages are deposited. Each week after our wages were deposited an automatic transaction transferred a set amount into the high interest account.

The money was moved straight away so we didn't miss it as such. Now bills usually come every quarter so this savings account has the chance to build up enough money to cater for the expenses and also earn a nice rate of interest before the next bill arrives. When it does arrive now I don't panic. I simply transfer the precise amount into our transaction account the day before payment and clear the expense online.

This savings account also provides us with a buffer in case of unforseen or additional expenses. We don't withdraw anymore than what is required and if we have enough in our transaction account to clear a bill I won't touch the money at all. The automatic transfer of the money straight after we're paid is what really helps us save. Scared of bills no more !

Thursday, May 31, 2007

Use Every Drop of Shampoo

I know this will seem miserly but it is easy to do and gives lots of value. I'm sure you've found that when you get near the end of a shampoo or dish washing detergent bottle there's still lots more liquid in there but it's stuck to the bottom or sides. By placing the shampoo bottle upside down when you finish your shower the liquid flows to the bottom where you can easily squeeze it out.

Shampoos, detergents, toiletries are so expense and this simple trick which my whole family uses gives us two to five washes that we would have thrown away in frustration. It's a bit trickier if the lid on the bottle is not flat but it's worth the effort.

Next time you venture into the supermarket keep it in mind and buy a flat lid bottle which will stand on it's own when placed upside down. Great thing about this tip is you can be miserly without embarrassment as no one will really see it !

Saturday, May 26, 2007

Credit Cards

With the wide range of bills and purchases that we make it's pretty hard to not have a credit card. It is possible but it means carrying a lot more cash money and sometimes in an emergency you may not have the money on you. For the convenience we choose to use credit cards but use them as wisely as possible:
  • Chose a card with an interest free period giving us the opportunity to pay without penalty
  • Chose a card that allows supplementary cards for free
  • Chose a card that provides an incentive, in our case points towards free flights (this helps us with our vacation planning)
  • Chose a card that allows automatic bill payments
  • If we have a large transaction on our card we transfer from savings to pay it off because credit cards have the highest rate of penalty interest for us.
  • Put any spare cash into the credit card before other debt in order to reduce the interest paid
  • We reduced to only one type of card to avoid the multiple annual fees
  • If we do have the cash at hand we use it
  • Avoid if possible using the card if there is an interest penalty to use it
If I'm unable to pay off the balance before the due date I use a mini plan to pay off the amount as quick as possible. We keep a spreadsheet that tells us based on the current balance how many weeks it will take to pay the balance and the amount we need to pay. For example if we owe $1000 we use a 6 week plan to clear the debt being $166.67 per week.

If we buy something else we'll use a 12 week plan so as to not increase the weekly payment so significantly that we can't live. So if we buy something for $750, we add another $62.50 to the weekly minimum making the new payment $229.17.

It means that we may pay some interest if we don't have much savings at the time however we try and pay off the balance as quick as possible. It's not an exact science however it works for me.

Saturday, May 19, 2007

Mom's Finance

Like many mom's we usually get stuck with paying the bills and being the family's default financial planner. Never enough money to pay the bills and faced with important financial issues every day. I hope to blog about the easiest way I and my family deal with credit cards, mortgages, bills, insurances, school fees etc.

Let the financial journey begin says she Mrs BlogWriter.