Let's re-cap...

What a crazy couple of months it’s been! Here’s a quick re-cap on what you’ve helped us achieve over the first 4 weeks, and some of your great comments that helped us along, and might help you along too!

Week 1: We paid off Matt’s credit card with our emergency savings. One debt down!

Anonymous said…
It is foolish to owe money on a credit card, which is high interest, if you have money sitting around in an emergency fund. With no emergency fund temporarily you can still rely on the credit card if something comes up. In the meantime - save on the interest!

Week 2: We decided not to extend our mortgage to buy a bigger car. Our little hatchback is still a pain (in my back!) but at least it’s still going…

vdanegerous said...
Hang on to the car you have got for a bit longer and don't spend anymore than $5,000 on another car when you have saved that much. Avoid paying interest as much as possible.

… and then your votes told us to go cold turkey on our spending…

Carla said…
Its AMAZING how much extra a week you spend on NOTHING! get a little notebook (they only cost .30c at a stationary place) and take it EVERYWHERE with you, write down EVERY purchase whether it be a $3 coffee or a $150 food shop, at the end of the week, go through your notebook and work out the amount you spent on things you really did not need, its amazing how it adds up and can all contribute towards your household.

Week 3: Matt was the loser in this one – goodbye to his $8 lunches, hello to making sandwiches in the morning. But I felt sorry for him and gave up my gym membership as well. Result? $280 saved off our budget each month!

stacey_kay said...
Not only is a budget about compromise, so is a relationship. I do not know why only one of you have got to miss out on their luxury - how about you BOTH cut something out. Yep I think Matt should start packing his lunch as $8 a day soon adds up to a few packets of nappies a week! But in saying that, you too should drop something. Maybe the gym membership (if you pay as you go and there are no costs involved in stopping) as at least with pay tv you and Matt can sit down together to watch it.

… then in some ways you could say I was the loser on the next question – back to work one day a week! But of course it had its bright side – turned our budget around from an $11,000 deficit to a modest surplus.

Anonymous said...
Definitely go for the part time work. It will keep your skills current and you won’t end like me who was a SAHM for 7 years then had to entirely retrain because I had lost all the knowledge by being at home.

Love that SAHM acronym!

Week 4: We changed our mortgage from monthly to fortnightly, paying half our previous monthly amount each fortnight. It’s going to cost us more over the year, but the result is our mortgage will be paid off a couple of years faster, saving us about $20,000 in interest.

JB said...
By repaying your mortgage fortnightly you will save heaps of money in the long run, and wipe years off your mortgage! You should aim to pay 50% of your monthly repayment (if you can manage a bit more - go 4 it).

… then your voting was pretty much 50/50 on whether I should start paying off my student loan or not. But the weight of opinion in your comments pushed me away from doing this for the moment.

Anonymous said...
I would say to pay off the interest bearing debt first and then tackle that student loan. Maybe you could put the amount that you WOULD pay on your student loan - onto the interest bearing debt. That way - once you have paid off that debt - you could transfer the payment straight to your student loan and you won't miss it! :)

Back later to review what happened over the last few weeks.

See ya!

Steph

Week 8, Question 1

Let’s get a few things straight. Recently we’ve been talking about issues like buying an investment property, setting up a family trust and forming a company.

Judging by your comments, some of you obviously reckon we shouldn’t be thinking about these things.

With the exception of the company (which as someone has pointed out is no big deal to set up), these have NOT been things we would necessarily plan on doing in the near future.

Now that our finances are on a reasonably even keel (thanks to the decisions you’ve helped us make!) we just wanted to take the opportunity to think about our long-term financial future and set a direction to head towards.

OK, got that off my chest.

But back over to you. Do you think we really are sorted now? Or do we still have a way to go?

Steph

Company vs Sole Trader

Here's the latest from Martin Hawes on whether we should set up that company or not. Looks like "not" - from his point of view at least!

Steph

At the moment I would simply stay as a sole trader. It is usually my preference for people to trade through companies (usually for tax purposes) however there is likely to be no tax saving for you because your income will be too low.

When your income increases to over $60,000 pa a company could give you some good savings. In the meantime, I would not bother about the expense.

Martin

Judging by your votes, quite a few of you agree with Martin on this one. But we'll see what the final result is tomorrow.

Bye for now.

Steph