Renting

A lot of the articles you read in financial papers/websites talk about the pros and cons of renting versus buying in purely economic terms, focusing on the rate of return on investment, usually assuming that a renter is investing the money they are saving by renting.

As a long term renter I like to read these articles, as they often put the renter out in front. However, I have not been a good saver and investor, only recently getting my act together and still only having a small amount invested. And my partner and I do want to buy property and have been saving a deposit for quite a while now. However, due to crazy Melbourne house prices we have resigned ourselves to buying an investment property rather than a home to live in. We figure that at least we will have a property of some sort paid off by the time we retire, allowing us to live rent-free in retirement.

But I thought I would put together a list of all the good things about renting, not only to make myself feel better, but to make others feel good about their renting situation too:

• Rent is usually well below what you would be paying for a mortgage for the same property, even with interest rates this low. For example, I live in a house that would probably sell for a bit over $1million (even though it's old and run down, it's in inner Melbourne's Northcote which is prime real estate at the moment!) but we only pay $2064 a month in rent. An $800K mortgage would set you back around $3800 a month at the moment with 4% interest rates.
• If you are fortunate enough to find a long-term rental (which we have), rent increases are generally minimal, especially in comparison to market increases. Eg. I estimate our house would rent now for around $2400 a month, probably more given our improvements - see below.
• When things go wrong, you don't have to pay! ie. plumbing issues, hot water service breaking. Not your problem.
• You can move much more easily and cheaply if your situation changes. Around my area it's all about high school zones. When it comes time to choose a high school for my children, we could potentially move houses and even suburbs, to get into the desired school zone, without having to pay the premium house price and all the other associated costs of buying and selling a home.

 And a few other thoughts about long-term renting:

• If you have a nice landlord/agent who is happy for you to make improvements to the property, and you feel confident that you will be there for a while, consider investing a bit of money to improve the property. 
• For example, our house was very run-down and a bit depressing and cold when we moved in. Improvements we have made over the years to the house include: 
• Painting the interior of the main rooms (with the landlord's permission; she agreed to avoid rent inrease for a year, as we did it ourselves and were given the paint from friends);
• Installing gas ducted heating (the landlord agreed to go halves; about $1100 each);
• Changing blinds and lampshades (got on sale at Spotlight so very inexpensive but looks great!);
• Buying and installing a dishwasher (we paid for it ourselves, plus the plumbing, but it was the best $1100 I've ever spent!);
• Painting the interior of the rest of the house (I got the paint cheap from a paint store - mistinted paints but all versions of off-white - enough for 4 rooms for $120!)
• Fake grass for the concrete back garden. I got a large piece for about $600 and have filled the gaps over the last year by picking up off-cuts from hard rubbish and friends. It doesn't look perfect but it means my kids have a soft ground to play on. And I don't have to stare out the back window at concrete!
• A raised veggie box/planter. This can be taken with us if we move, but it makes the back yard look much nicer.
• So even though over the years we have spent a bit of money to spruce the place up, I estimate that what we save in rent has made it well worth it, and renting a cheaper house and fixing it up is a strategy I'll use again when we inevitably have to move. 
• For example, a freshly painted house with heating and a dishwasher in our suburb would be perhaps $130 a week more than what we currently pay, which is $500-600 month more or $6000 a year more! And we have been here for 7 years, so that's about a $42000 'saving' over this period! We will never move if we don't have to - but am sure that day will come. Fingers crossed it's not too soon. And I'd better actually start investing those savings!

Changing utility suppliers: Take 2!

Oh the joys! After deciding to stick with AGL for gas and electricity after they agreed to give me an extra discount off our already okay rates, I was pretty pleased to have saved some money with minimal effort. However, luckily I then checked the fine print when they emailed me the plan details (and next bill). Inexplicably, they had increased the base rate so substantially that I was now MUCH worse off!

I was naturally outraged and called them up.  I was put through to the 'resolutions' team, and the person I spoke to could not explain why the rates had gone up. She agreed to investigate and get back to me. Then nothing!

I called again a few weeks later and spoke to another person in the team, who also could not figure out why it had happened. Again, he agreed to investigate and promised to call back within 10 working days. That was about 4 weeks ago now and I've heard nothing.

So instead of going through the pain of calling them again, I've decided to switch. And it was surprisingly easy! I used the government site called Victorian Energy Compare and picked the cheapest electricity option, then went to the new company's website and signed up within about 5 minutes! All I needed was the metre number from a previous bill, and they then know all your details.  And my rates have dropped from a daily $1 supply charge to 71 cents, and usage from 19 cents to 15.4 cents. Which should all add up, plus there is a pay on time discount.

Now to sort out gas, but I was so excited about how easy it was, that I had to blog about it immediately!

Bread!

This is just a quick post about bread. I made my sourdough for my playgroup friends today and they were very impressed - even two ladies who had recently attended a sourdough workshop!

So here is the link to the recipe, which also includes a helpful video on how to make it. It's on Stonesoup, a very healthy and inspiring food blog.

I pretty much make it as she does, although my starter didn't use yoghurt to start it - just good old flour and water. It's now a year old, and definitely improves (!) with time.

Enjoy!

(PS. I can't seem to post/reply to comments at the moment - my apologies!)

School holiday blow-out!

This is my oldest son's first year in school and thus my first real experience of the school holidays (well, since trying to reign in my spending). And I have to say it's been a bit of a financial disaster! I feel like all the hard work I put in cutting back my spending over the last 4 months has completely gone out the door. These holidays I was a bit like a teenager with their first credit card - I was spending willy-nilly and saying 'stuff it!' and  'I deserve a treat!'.

Our grocery spend for the month of September ended up being about $400 over budget, mostly due to a week away with the extended family (why do kids in groups eat more than when at home?!), plus we threw a dinner party that I hadn't planned for. And the entertainment/food & dining categories were also way out of control. We treated the kids to the movies, and there were many cafe trips, lunches out, a zoo visit... Plus, a much needed date night got a bit extravagant with dinner, drinks and a movie!

Anyway, after spending this evening perusing the damage via my online banking portal, I think I can take away a few lessons.

1. It's very easy to fall back into old habits. But I'm not going to chuck the whole thing in. I'm going to be more vigilant this month and stick to our budget.
2. Next school holidays I'll be more prepared. I know the Simple Savings vault has heaps of tips on how to make the school holidays more affordable, and I'll also ask for tips online. 
3. The monthly shop is a good idea, but it doesn't cater for things that crop up (such as me deciding to host a dinner party), and I had tried to buy extra school holiday supplies/treats, but it just wasn't enough. So I'm going to try to keep more of the budget back to cater for these extra things. (I already set aside money for the weekly fruit and veg top up, so I just need to shop a bit smarter at the start of the month and put extra aside.)
4. It wasn't the kids' fault. It was mine. They would have been happy with home-made treats and a prima from Aldi, but it was me who was using the holidays as an excuse to break my 'limit cafes' rule. I need to plan better (including the kids in the planning) and get baking! I've been totally slack in that department recently.

So, it was a bit of a step backward, but we all had a lot of fun. And hopefully I've learned a few lessons!

Planning

Well, I think I can tick this month's task off the list. We saw our financial planner the other day to see what he thought about our plans to purchase a property. We have a decent deposit saved (or so I thought!) and I had met with a mortgage broker who outlined our borrowing capacity for an investment property or a home to live in. I was starting to get a bit excited, reading finance and property books from the library, spending way too many hours on real estate websites perusing properties for sale, sold and rent and dreaming about what it would be like to finally join the 'I own property' gang.

So I was a little disappointed when our planner suggested waiting and saving for another 18 months. This would give us a bigger deposit, ensure we don't pay mortgage lender's insurance, and cover all those pesky real estate transaction costs. However, he also made me feel quite proud. He said most people need a mortgage in order to force them to save, but we are such good savers we are better off just saving for a bit longer!

My partner and I have agreed that we will continue renting for the foreseeable future, as we love our house and suburb, and could never afford to purchase a house in the area. So in a few years we'll probably purchase an investment property elsewhere, mostly so that we have something to either move into or sell when we retire (we don't want to pay rent in retirement).

The planner was also impressed with my recent dabble into the share market. I think I'll continue to put a little bit into that as well which will hopefully set us up for the future.

We still have a few things to get sorted planning-wise: we still need to finalise our wills, organise power of attorney, and see someone for an income and death insurance review. I'm going to give us a deadline of the end of next month, and will keep you posted!

This month's challenge: getting the finances in order and planning

So this month's focus is on getting control of our finances and planning for our future. I'm quite good at putting together a budget and recently exported all our transactions from the 2015/16 financial year (mostly in handy categories from our online banking). Once I sorted last year's data (and was quietly horrified by our grocery spending - see month 1 challenge!) I put it together with this financial year's predictions and now have a lovely 2016/17 spending plan/budget.

Which is all very well, but I need to get my partner on board. We are pretty hopeless at talking about finances, so I'm blocking out an evening for us to discuss the budget/projected spending to ensure that it's realistic. This will help us work out how much money we need to regularly put into the joint account in order to cover expenses. It will also help us work out how much we can realistically save a year. This will in turn help us when we go and see a financial planner later in the month! (Booked in - good on me!)

We have a bit of money saved and are keen to see what the financial planner recommends in terms of future plans. We don't really know what to do - there are so many options! We could potentially buy an investment property, buy a home to live in, or invest in shares or a managed fund.

I recently did a great online course at 10,000 girl called the 'Online money makeover'. The course taught me the importance of planning for the future, and also for looking at all the options in terms of investing. It demystified the share market for me and I would highly recommend it. I even set up an online broker account with my bank and bought some shares!

So my partner and I need to figure out our priorities. I'm really torn between staying in our fabulous (and very cheap) rental property, and the urge that I have to own our own home. Buying a home to live in would mean moving suburbs (we currently live in Northcote in inner Melbourne, which has crazy property prices) and all things associated with moving: losing our network of friends at school/kinder/playgroup/sporting activities, moving further away from work (my partner currently rides to work and the public transport options here are also fabulous), losing our fabulous neighbours (who are now good friends), and losing our ability to save money/adding financial stress to our lives.

Anyway, each time I try to book in our budget/planning evening, we're derailed by illness or tiredness. So hopefully next week!

Not so frugal after all...

Today I met with a mortgage broker, and the most surprising thing he told me was not that we couldn't afford a house within 10km of our current rental (no surprises there) but that our monthly expenses (excluding rent) were above average. Here I was thinking that we were super frugal, but apparently not!

According to the mortgage broker, the average expenses for a 2 adult, 3 child family is $3,600 month (excluding mortgage/rent). This data comes from HEM - the Household Expenditure Measurement Index, which is quarterly survey conducted by the Melbourne Institute of Applied Economic and Social Research at the University of Melbourne. The HEM is used when estimating expenses when applying for home loans in Australia.

Now, finding information about the HEM online is a bit tricky. To get details and updates it seems you need to subscribe to the official reports. However,  I found this table which has the average figures valid from July 2015. This other Living Expenses Calculator is also helpful and based on the HEM; it calls the HEM average a 'basic' lifestyle, while if you say you live a 'moderate' lifestyle it estimates $4900 a month in expenses. Which is well above what we spend - and it made me feel a lot better. Our monthly average expense is closer to $3900 (excluding rent), which is about $300 a month above the 'average' Australian expenditure.

Now all this talk about average spending got me thinking about lifestyle. Some people live extremely frugal lives. I used to be a member of several savings forums (Simple Savings and Cheapskates as well as various savings-focused Facebook groups) and was often shamed by my usually pathetic attempts to save - particularly given the ample income I was earning at the time. Some people survive on below the minimum wage and would never consider buying cafe coffee. I feel proud when I only buy a latte every few days. It's all about priorities for me, while some people don't have a choice.

Then there is the other extreme; lots of people I know buy one or two coffees a day, often get takeaway and buy their lunch, go out for fancy dinners, fly interstate/overseas on holidays, go skiing, regularly buy expensive clothes, household items, technology etc. A lot of these people earn a lot of money but many also have lots of credit card debt and a stressful mortgage!

Keeping up with the Jones's can make life stressful, as can not keeping up! I often find myself saying no to things due to the expense factor. People don't need to know why I'm saying no, although I do often tell them! But it can be a little embarrassing saying no to things.

The perfect example was a surprise weekend in Sydney for my friend's 40th.  Her mum organised it and her husband even offered to buy my airfare, but I knew it would be an expensive weekend even so, with the shopping, cocktails and fancy meals that my friend is fond of. So I politely declined. My other friend who went reckons she spent $400 on top of the airfare! A lucky escape for me...

Less extravagant examples of ingrained 'pressure' to spend would be meeting friends for dinner or drinks. I sometimes suggest meeting at someone's house instead if I'm trying not to spend, or just going for a drink rather than dinner. But as it's only a small amount of money I think it's difficult for others to see the problem. We are not poor and yes, we can afford it, but I want to save our money so that we can eventually afford to buy a home.

Sometimes I even feel the pressure to spend on small things like activities for the children. One of my good friend loves taking her kids to play centres, the cost of which quickly adds up with 3 kids and a coffee! So now I limit the pricier activities to one per school holidays. And my son wants to do martial arts lessons with his mates, but at $40 a week (!) I've had to say no. I was astounded when all the other mums at school were talking about signing their kids up. This is probably why I didn't get much moral support when I complained to the Principal about the high cost of the school concert tickets...

So I'm tipping that the majority of my friends and the families living in my fairly affluent area spend well above the Australian average on expenses. It does make it quite difficult to reign in the spending when you are surrounded by people who spend a lot and possibly don't question their spending.

It helps to get my savings inspiration elsewhere, and I've been inspired recently by a blog about extreme frugality and early retirement (but with a quality of life focus) called Mr Money Mustache. Even if you don't want to be as frugal as him, he is seriously inspiring. Have a read!

Utilities... UGH!

So, Victorian Energy Compare has certainly made it a bit easier, but I just have to say I want to tear my hair out!!! I still have no idea what to do about my Electricity and Gas bills after spending several hours on the task. It's all so damn confusing!

We currently have both bills with AGL, and we get a 14% discount off our usage if we pay on time (which we always do). So although our rates might be a little higher than some other companies, the discount does help. I called AGL hoping to negotiate down the daily supply charge rate, which seemed very high, but they just got me more confused! They offered an extra 20% discount if we combine the two bills. Which sounds great, but the discount is only off usage and our supply charge is usually higher than our usage. So now I need to go and do even more calculations to see if we'll come out in front against other companies with lower rates. It's all very boring 'back of the envelope' calculations which I really don't care for. No wonder people just give up!

Our bills actually aren't too ridiculous anyway. According to our electricity bills we use less electricity than the average 1 person household! What on earth do people do to use so much electricity?! And our gas bill is only crazy in winter, so we can cope with that too.

So I think I'll just stick with AGL and get the extra discount. Saves changing suppliers and setting up new online transfers. At least I'll save us a bit of money this year!

False economies

No, I haven't sorted my gas and electricity bills yet. This week, I promise!

In the interim I thought I'd tell you a little story about a blouse. Last weekend I went to a friend's wedding, and I had nothing appropriate to wear - my one wedding outfit is a summer ensemble. So I asked a friend if I could borrow an outfit, and she obliged. It was a gorgeous colourful silk top and fancy skirt. I looked lovely and received lots of compliments on the night. And I was feeling rather smug that I hadn't needed to go out and spend lots of money on a new outfit!

However, disaster occurred when mains were served at the same time as speeches. I dropped an oily salad leaf down my front and there was a rather noticeable oil stain right on centre of the blouse.  Disaster!

Anyway, to cut a long story cut short, I attempted to clean the blouse myself. I've always been a bit skeptical about the need for dry cleaning and I had done a quick hand wash before I wore it and it was fine. However, my scrubbing and the strong detergent completely ruined the top.

I felt physically ill as soon as I realised, and felt sick until I went around the next night to tell my friend the bad news. I knew it had been one of her favourite tops and on high rotation in her wardrobe. I wrote a 'sorry' card and withdrew a large amount of money so she could try to replace it and/or buy a whole new outfit.

In the end she was great about it and only accepted a token amount of the money. But it made me realise a few things:

• 1) Don't be a tight arse. Spending money on dry cleaning would have probably saved the top. Another example of this is buying generic brand items that you know just aren't as good. I bought Aldi wraps last week (which I think are no good - one of the few Aldi 'fails' in my opinion) and they keep coming home in the lunch box. I should have spent the extra few dollars on the Mission brand ones.
• 2) Don't make decisions on a hangover! (See (1).) 
• 3) Borrowing items may sound like a frugal option, but consider what will happen if things go wrong. Other examples of this include ruining a friend's old phone that they lent you or crashing their car.

So next time I'll be recycling an out-of-date and season outfit, or hitting the opp shops for a new outfit. At a wedding no-one looks at what you are wearing anyway - all eyes are on the bride!

Next items to tackle: Utilities

I can't bring myself to start reviewing our electricity and gas bills yet, although I know there is a great site that allows you to plug in your numbers and see if you can get a better deal - my friend Bec blogged about it over here. It's a government site called Victorian Energy Compare and apparently most households can save around $300 a year on their electricity bills.  That will be next week's job as I'm exhausted after all the excitement of changing insurance providers last week.

In the interim I thought I'd talk about mobile phones. Over the last 20 years I have wasted a lot of money going with the two big providers, Telstra and Optus. Both are ridiculously expensive. I have also moved on from feeling the need to get a new phone every 2 years, just because.

When my last contract was up I finally owned my phone (I was on a 2 year contract where you pay off the phone) and I was finally free to shop around. It became clear that the 2 cheapest/best value options were Amayasim and Aldi. I went with Aldi as it's on the Telstra network and I hated the Optus network coverage when I was with them.

And it is SO cheap! I used to pay over $60 a month for a similar plan, and I now pay $20/month. They tell me I could do the $15 a month plan with my current usage, but I like to have a bit of a buffer. Anyway, that's an annual saving of $480!

So if you own your phone I would strongly recommend shopping around for a better deal. The same goes for your home internet provider. I'm with TPG on a $50/month plan that provides 200GB, which is pretty cheap and was a very good deal when I signed up many years ago. I still think this is very good value, but with the advent of streaming most providers are now doing better deals for more (or even unlimited) data. So again, check your usage and shop around.

Insurance sorted!

Well, it was painful and time consuming, but I have just changed our car, house contents and health insurance policies and saved us a whopping $1988.94 a year!

Approximately half of that was reducing our health insurance from the top hospital cover to the mid-range one that doesn't include obstetrics/pregnancy related items. I should have done this a year ago as soon as my (third and final) baby was born. But it didn't even cross my mind! At least we have used the policy a lot over the last year so I don't feel too ripped off. And I loved having my baby in a private hospital!

On that note, I read an article a few years ago about hospital extras cover, saying that insurance companies make most of their money from the extras cover and that for most people paying for extras cover doesn't make financial sense. Of course it depends on your circumstances, but I did the sums back then and we got rid of our extras cover (saving us a conservative $250/year). However, I have lots of friends who say they definitely get more back from their cover than they pay (they are probably good and go to the dentist more than me!). So if you pay for extras cover each month, it's a good idea to assess if you are getting your money's worth.

The rest of the savings came by switching our car and house contents insurance (we rent) to another company. We'd been with AAMI for 7 years and I hadn't been bothered to check if we were getting a good deal or not. I think the lesson here is don't be lazy like me! When you get your annual renewal put aside an evening or afternoon (many insurance companies are open in the evenings and weekends) and do some comparisons. Yes, it is extremely time consuming (I was on the phone to Youi for nearly an hour sorting out both policies, as well as to AAMI seeing if they could do better and finally cancelling the policies) and rather boring, but I now feel very proud of myself! You can start with comparison websites but unfortunately you need to talk to people to get your insurance finalised.

So here is a breakdown of our savings. Hopefully it inspires you to pull out your policies and see if you can get a better deal!

Car insurance: comprehensive cover on a Volvo worth around $6000

• Was $120.80/month or $1449.60/year with AAMI (we paid monthly which increased the premium significantly).
• Now $886.16/year with Youi.
• Saving of $563.44/year

Contents insurance: $80,000 worth of cover

• Was $839.20/year with AAMI. Seven years ago when we moved in this was good value as I shopped around.
• Now $335.90/year with Youi. 
• Saving of $503.30/year

Health insurance: with HFC from premium to mid hospital

• Was $302.40/month. This was Premium hospital with HCF, without extras. I wanted pregnancy to be covered so I could have my third child in a private hospital.
• Now $225.55/month. This is Mid hospital with HCF, as we no longer need obstetrics. 
• Saving of $922.20/year

Total Saving: $1988.94/year

The new frontier

The first month with only a monthly shop (and top up veggies) is over and it was surprisingly easy. Just goes to show what a little planning can achieve. The month's grocery spend was quite high in the end (about $700) but I put that down to having to do a major re-stock after the no-spend month. I'm confident I can keep the grocery budget to about $600 a month from now on, which is a pretty drastic improvement on the previous average spend of over $1000 a month.


Well, that's what I thought our average grocery spend was, but it turns out that I was only looking at the previous 3 months of spending. This week I did a full 2015-2016 spending analysis by exporting all our data from our online banking system which has a budgeting function allowing each spend to be allocated to a category. This makes ongoing tracking nice and easy and allows for relatively quick and easy analysis (using pivot tables in Excel - the geek in me is coming out!).

What I was shocked to find was that the three months prior to no-spend month were actually an anomaly! Our grocery spend across the financial year had increased very quickly from $550 last July to averaging $1100 per month from November! So what happened?

I think 'Hello Fresh' boxes had a lot to do with it. I got sucked in by the half-price first couple of boxes and the convenience and excitement of trying new recipes each week. But I was also getting the usual CERES fruit and veg box each week as well as spending a lot of time popping into Coles for a few things here and there. My baby also started on solids at around this time and she loves her food!

I also think that getting into the rhythm of not working and being at home with the kids affected my shopping. At a time when I should have been becoming extra frugal due to the one income situation, I was popping to the shops on a regular basis as an outing. The shops are a 10 minute walk and there is a park on the way, so this was the perfect way to get out of the house and get among people and give the kids a run-around. The silly thing is that I can go to the park (and library which is near the shops) and not spend any money! Now I walk through the shopping centre on my way to the library to get my 'getting among people' fix, and do my best not to buy anything except the odd loaf of bread.

So now that I feel the grocery spend is under control, and the 'food and dining' (read cafe) spend has been drastically reduced too (although still way too high...) the next step in saving our budget is cutting 'fixed' expenses, like insurance premiums and utility bills. This is something I have been putting off for a very long time, as I can think of nothing worse than sitting on the phone getting insurance quotes, but I know that I can do better, particularly with our car insurance. So stay tuned!

The month after: how I'm tracking

At the start of this 'spending' month I was a bit worried that I hadn't learned anything from the no-spend month. However, it's now week 3 and I feel like I have definitely changed my coffee habits for the better, as well as my 'eat through the fridge and fruit bowl before I buy more food' habit.

We've managed to stretch last week's fruit and veg box out for 9 days (about to head to the fruit and veg shop for a top up) and I've only bought coffee a few times over the last week or so - and I mostly resisted the muffin add-on! I'm spending today replenishing the baked goods (making vegemite scrolls and choc-chip biscuits) and am feeling pretty good about our budget. I have exceeded my proposed grocery budget already, but this was mostly due to restocking of items that will last well past the month. So next month should be back on track.

Speaking of budget, I plan to spend the next week or so updating our (quite detailed) budget so that we can put together a plan to take to our financial advisor. We've been putting off seeing him for nearly a year now (the baby took over my headspace!) but am feeling that it's time to tackle this, especially with tax time soon approaching.

I'm also spending my time getting inspiration from others. There was an article in The Age Money section yesterday about 'extreme budgeting', with links to some rather interesting blogs that I've started to read. Inspiring stuff!

It's over!

Well I'm very happy that no-spend month is over, but also very proud of myself for getting through 31 days without any outrageous spending. Our grocery bill came in at under $300 (mostly fruit, veg and other necessities) and I only bought one coffee all month. I did go out a few times last week though, but didn't go overboard and had a great time so it was worth it!

I had decided that from now on I'll allow myself $20 a week for cafe coffee, but I blew that on the 1st of June when I shouted a friend coffee and also bought some fruit bread! I was just so excited to be in a cafe! And then I got another coffee the next day... Oh well, I'll do better next week. At least I've become more conscious of what I'm spending.

In terms of groceries in future, we have decided to attempt a monthly shop, with top-up fruit and veg. I spent most of last week preparing the list and have spent the last few days traipsing around the shops getting everything we need. As we used up a lot of stuff last month, it was quite a long list, with lots of expensive items like nuts, coconut oil, maple syrup etc. Consequently I've spent over $400. Most of this was at Aldi, with the rest at local health/nut shops and importers. I had decided to try to not shop at Coles/Woolies from now on, but couldn't resist the half-price bargains this week at Woolies (I get the catalogues via email). I spent $32 with $27 of savings! Stocked up on peanut butter (my family only likes Kraft), Lindt chocolate, and my favourite tea.

So I'm now going to aim to keep it under $600 for the month, which should be viable given we should have everything we need for the month (I did a rough meal plan) and I'll only need to buy fruit and veg. If I achieve this I'll be halving our previous grocery spend so I'll be happy. Then maybe next month I'll aim for a $500 budget, as a lot of the things I bought this week were large bulk packs. Anyway, I'll continue to update this blog with our progress each month.

Anyway, in summary, this is what I learned from the no-spend challenge:

1. Keeping away from the shops really helps. That's why I've decided to switch to a monthly grocery shop rather than weekly (or in my case, every 2-3 days!). 
2. It's amazing what you can find up the back of the cupboards and fridge! I left the clean-out of both until towards the end of the month, and found some great stuff to get us through the last week. I found cannelloni shells, half a jar of natural peanut butter, various nearly-finished packs of flour, agave syrup etc.
3. There is always a substitute. I used to give my son the same things in his lunch each day but last month changed it up depending on what we had left. It meant we ate through all the fruit before buying more, and got through the last few weeks without buying more bikkies. We discovered that popcorn is a great lunchbox snack. And kids love baked goods, even if they are pretty unexciting (I created porridge biscuits which were a hit!).
4. Baking bread is great but sometimes you need a break. For the first 3 weeks I was baking my no-knead sourdough loaf nearly every day, as well as baking sweet things and doing the usual cooking of meals. And it was exhausting. Our local bakery does a nice sandwich loaf for $2 and I've decided to buy one or two of those a week this month so that I only have to bake my bread twice a week. I might even give a bread maker a go - my neighbor has offered me hers to borrow.
5. Catching up with friends is still fun if it's at a house! Okay, so not as much fun really, but still fun. I've spent the month visiting friends for morning coffee or afternoon tea, so have probably been more social than usual - especially as I was actively seeking out those with coffee machines! I also had a wine night at my house. It was like book club without the book - quite fun.
6. Planning daytime food is important. I got caught out a few times when I went out with the girls for the morning and then ended up doing something else around lunch time and we didn't have enough food to get us through. I now try to pack a lunch box for me and the girls when I'm doing Lewis' school lunch so that it's easier in the morning when we're rushing out the door. And I always try to have some crackers in the nappy bag for emergencies.
7. Being held accountable (ie. publishing this blog) was very important for me to keep on track. So many times I was tempted by a cafe, but I resisted. Hopefully I'll continue this blog to keep me on track in future.

The home straight

Two days to go until no-spend month is over! And I can't wait, although to be honest I've been rather slack this week and broken it! I've been out twice this week and spent money. The first was a playgroup mum's dinner ($43 which included a lovely Ethiopian meal with a few wines - bargain!) and then last night was a catch up with my old housemates ($34 just on booze... when did beer get so expensive?!). Both events happen rarely and I really wanted to go to both -  so I decided stuff it! Both evenings out were good for my mental health and I'm glad I went. Earlier in the week I had some girlfriends over for drinks rather than go to a bar, so at least I saved us all some money there! I'm slowly working my way through my stash of wine, as well as the food cupboards.

Surprisingly, we still have a lot of stuff in the cupboards. I'm going to spend tomorrow pulling everything out and trying to work out how we can use it next month. Hopefully this will mean I can take some stuff off the monthly shopping list, as it's looking pretty huge at the moment. We are out of nearly all baking supplies, muesli supplies (we make our own), legumes, tofu, soy and oat milks, chocolate (!), peanut butter/vegemite and many other 'essential' items.

So I suspect our grocery bill next month will be pretty substantial due to all the restocking, but hopefully won't be as huge as in the past. I'm pretty pleased that our grocery spend this month should come in at $293, which considering our average spend over the 3 months prior was $1200 a month (I know, I know - outrageous) is pretty impressive! The $293 covered fruit and veg, and buying necessities that we ran out of like toilet paper, nappies and soy milk. (I know soy milk is not really a necessity, but as I haven't been going to cafes I consider it necessary!)

Other spending this week was on a gift for a 6 year old. Earlier in the month I found something to re-gift for another party, but there was nothing left that I could think of to re-gift so ended up buying something. I checked out the local opp shop and second hand book store first, but ended up with a very reasonably priced book (the 12 story tree house) from Kmart. I'm sure the birthday boy will enjoy his copy as much as my son does.

Hopefully I can get through the next 2 days without any spending. I just baked a loaf with the last of the flour and we have enough fruit and veg to last the distance. I just need to resist the cafes tomorrow. I've been organising lots of coffee catch ups at friend's houses which has been a useful way to get me over the cafe thing, but I'm still feeling drawn to them! I'm not really sure the challenge has changed my habits in that sense.

Week 3 - so busy I couldn't blog!

Baking is time-consuming and exhausting! That is the conclusion I have reached this week. I've been working my way through 10kg of flour, baking a loaf of sourdough bread each day, making biscuits regularly to use up leftover porridge and fill up the lunchboxes, and baking cakes and cupcakes for my daughter's birthday events last week. On top of the baking I've been cooking everything from scratch even more so since we have started running out of things over the month. By the end of my daughter's birthday last Friday I felt like collapsing from cooking exhaustion! We only had small gatherings but there were multiple and there was a lot of bread and pizza involved.

Anyway, today when I did the weekly fruit and veg shop I bought a loaf of bread and it feels very liberating not to be preparing the bread tonight! Once this month is over I think I'll go back to making bread a few times a week instead of every day. It will also be better for my waistline as I tend to eat half the loaf when it comes out of the oven! I also decided to get the fruit and veg at my local market this week, instead of ordering the usual CERES box, as the challenge of using everything up in the box has also been a bit exhausting. I know we'll easily eat everything in the fridge and fruit bowl this week.

Week 3 highlights are all to do with the kindness of my friends and family. People have been quite taken by this challenge and have been very kind in their support, both verbally and in kind!

• My friend Mel who lives in Sydney sent me a 'no spend challenge care package'! One morning I was thrilled to find it on the doorstep. It included some yummy chocolatey treats as well as a selection of herbal teas (which coincidentally I had just run out of). It made me very happy!
• Another friend Mel gave me a present of 'Orgram No Egg', which is an egg replacer. Very lovely and very handy for all my baking!
• My sister-in-law had us over for dinner (lovely!) and on leaving donated us chillis, onions and garlic as well as some other stuff from their Hello Fresh boxes that they couldn't eat due to my brother's food intolerances.
• My friend Laura shouted me and Ginger a coffee and babycino after our outing to storytime at the State Library. So good!!! I really miss cafe coffeee...

Speaking of cafes, I've nearly caved so many times this week, but have kept on walking. Good on me! Poor Ginger is having major withdrawals as well. It's usually such a regular part of our day that she just can't work out what is going on! However, I am really enjoying my stovetop coffee at the moment, so it's not actually the coffee that I'm missing.

In other week 3 news, we ran out of nappies and toilet paper! So I did an Aldi run and bought a pack of each. And also bought some ground coffee as I really haven't been enjoying the one I had in the freezer. It will make the final week a lot more bearable.

This has made us think about what we are going to do next month. Adrian and I have decided that in terms of groceries we'll continue on with a similar method, but will plan a lot better. So this will mean a monthly meal plan and one massive shop at the start of the month, with the fruit and veg box or shop each week. I've also decided to try and avoid Coles/Woolworths all together, as I think I can now get most stuff at Aldi (they now have tofu and vegan snags/burgers, nuttlex) with the remainder from my local shops (health food store and greek importers). I've already started a list of things we have run out of and will do a general meal plan to ensure we can do most meals. We actually still have a lot of food in the cupboards that needs to be eaten, so I'll try to incorporate that into the meal plans.

Although I'm not quite sure how I'm going to use up 5 tins of sliced beetroot! My obsession with keeping the cupboards well stocked has meant some serious over-supply of certain things. Creating a very detailed meal plan and shopping list and then sticking to it will be quite a challenge for me!

Week 2... not so good

This week's 'no spend' has not gone so well! Where do I start... today I was hungover I had to go to see the Sound of Music with 2 of my kids and my sister in law, who kindly got the tickets for my birthday.

However, the hangover meant that I decided we should catch the train into town rather than deal with the stress of city parking and driving. We got to the station and I realised that my son's Myki was out of funds, and that my Myki was not in my bag. Luckily I have a spare card, but I ended up spending $15 to top up both cards. Next, I was so very hungover that I needed a second coffee before the performance. And so I bought my first cafe coffee for the month. It wasn't even very nice! So a $19 spend today. Not great.

I've been really missing going to cafes still. I think once the month is up I'll allow myself to go once or twice a week, as it makes me very happy!

Other unexpected expenses this week included new shoes for Ginger, two big bags of flour so I can continue to make bread (I bought a bag, and Adrian didn't realise and also bought one!), a block of Lindt for my mother's day present (I said I didn't want anything, but did enjoy it!), and in addition to the fruit and veg top up, we bought some more Bonsoy as we are about to run out. Usually I go through 1 litre a week, but since the cafe ban we've been drinking 2-3 litres a week! I suppose I should just be drinking black coffee, but I just can't do it...

One thing I'm really noticing with the fruit and veg boxes, is that we're not doing the top up until there is absolutely nothing left. In the past, I'd start to freak out when the fruit bowl was getting low, but now we actually eat the stuff that I often left to get old and sad. For example, I have discovered that my kids LOVE oranges, pears, and celery with peanut butter. These are things that I never even tried giving them in the past.

I'm also learning to bake biscuits, using oats and whatever else I can find in the cupboard. I've been surprised how easy and delicious they are!

Week 1 done!

Well, week 1 of my no spend month is over and although it wasn't a complete success, I spent substantially less than usual.

Positives of the week:
No cafe visits! I embraced my stove-top coffee machine and didn't miss the actual cafe coffee at all. But I did miss actually going to cafes. I've realised that my little outings to grab a coffee and a few things from the shops are enjoyable because I'm interacting with people. I love the staff at my favourite cafe, and even love the surly ladies who serve me at the fruit and veg shop (I'd be surly if I worked there too - it's freezing!). My son is in prep and learning about his community at the moment, which incorporated a visit to our local shopping plaza and library last week. I scoffed at the time, but have realised how much I do love living (and shopping) in my local community.

More park/playground visits! Due to cafes not being an option, I've made sure my daily outings with the girls are a bit more exciting than the usual park that we go to post-cafe. So I've packed snacks and we've headed to playgrounds a bit further afield. I even managed to go to the Edinburgh Gardens playground without spending money! Normally after the playground I'm tempted by the Clifton Hill shops. This usually involves a cafe visit and a fruit/veg top up at the overpriced veg shops there. I can easily spend $50, so good on me for avoiding that this week.

Thinking outside the square food-wise. I had a big bowl of leftover porridge the other day that I managed to turn into rather delicious chocolate biscuits! And when we ran out of bread, my son's sandwich was replaced by rice cakes. And by saving celery ends in the freezer for stock, my soup was saved.

The not quite successful bits:
Planning issues. I totally stuffed up in terms of making sure I had enough basics to get me through the month. We have nearly run out of flour, which is a problem if I'm going to make my own bread, pizza dough etc. (and keep my starter alive!). And the tissue and toilet paper supplies are a lot lower than I thought - but we might just make it through - and I'm sure we have a hanky stash somewhere. Anyway, I'm going to buy a big 10kg bag of flour to get us through - a lot cheaper than buying bread, wraps, pizza bases etc.  Also, we went away for the weekend and although I took a lot of food with us, I ended up buying some food at the supermarket for one of the meals. Nothing outrageous, but I could have planned better and taken more stuff with me.

Getting a 5 year old on board. There was a mother's day stall at my son's school and we were asked to send $5 to $8 with our child so they could buy us something. I explained to Lewis that we weren't spending money this month and that I didn't want a (probably crappy!!) gift. All I wanted was a nice home-made card. He was pretty unhappy about this and was upset, as all the other kids had money that morning. Anyway, it turns out that the parents running the stall felt sorry for him and gave him stuff for free! It was just a card and a bookmark, but now I just feel bad. Also, Lewis's friend just gave him some of his money, which he brought home. Disaster all round.

Unexpected expenses. In addition to the mother's day stall fiasco, Lewis's school announced that the school concert tickets were on sale FOR $25 EACH! I was (and still am) outraged. My son is in Prep and is singing one song, and for that we must pay $50 to see him sing. I've written an email to the school expressing my outrage, but had to buy the tickets. Lewis tells me he won a prize for best dancing the other day, so hopefully it's worth the $50! Other expenses include Ginger's only pair of (non summer) shoes literally falling apart - her socks get wet when it rains - so we'll be off to the shops this week. But of course I'll shop around for a bargain!

====
So all up, it's been a fairly successful start to the no spend month, with a few minor hiccups. Although the week did go VERY slowly! But I think that was just my cafe withdrawal...

Day 2: Minimal hurdles

I spent $1 today on the hire of tap shoes for Ginger's ballet/tap class. I had totally forgotten about this expense, which we have to pay each week. But it's a lot cheaper than forking out for a pair of shoes which she'll grow out of within months, so I didn't feel too bad about breaking the 'no spend' rule.

I also had a bit of a win this evening when Adrian wanted to go out and buy eggs so he could make bread and butter pudding. [We had lots of white bread crusts left over from fairy bread that needed using, and bread and butter pudding is his favourite food - yes, really!] But instead of going to the shops for eggs, I convinced him to rifle through the cupboards and find some custard powder to mix with milk (also left over from the party; we don't normally have dairy in the house). Anyway, he's happy as apparently is was actually quite nice.

I also spent money today on a doctor's visit, but health/medical isn't included in the challenge so that's all good. And the GP actually saved me money as I had decided that I needed to take Darcy and myself off to sleep school, but he convinced me that I had all the tools to work it out myself. So I'm now feeling motivated to actually try and fix her sleep issues and he's given me lots of good ideas. So fingers crossed!

I've also gone through the fridge today and meal planned for the rest of the week and decided I won't need a fruit and veg box until next Tuesday, which is pretty good.

I have also realised (following lots of FB queries) that I don't have enough flour to make my usual bread for the rest of the month. We used a heap making cakes for the girls' birthday party last week. I'll be okay for another week or so, but then will have to decide whether to buy some or to beg/borrow from the neighbours. I could repay them in loaves of sourdough if they provide enough flour!

Another problem that I hadn't foreseen is that I have a playgroup night out scheduled for later in the month that I really want to go to. Not quite sure how to get around that one. Will probably just have to miss it or go at the end for a drink (... of water!).

Day 1: Easy as!

Today was the first day of my 'no-spend' month of May, and it was remarkably easy. It's a Sunday and I spent the morning at home reading the paper (we have an ongoing delivery so I'm not counting that as spending) and cleaning the house (we had a birthday party at home yesterday). I got my coffee fix at home (I'm fortunate to have a machine as well as a stovetop coffee maker). In the afternoon we went to a playgroup child's 2nd birthday party and I cheekily re-gifted a present. Dinner was easy as we have plenty of veggies in the fridge and Adrian made veggie/lentil dahl.

So I had no real need to go out today and spend money. But yesterday I went to a cafe and had coffee and brunch, which I was trying not to do... However cafes are my escape and I love nothing more than sitting in one for an hour reading and sipping coffee. When I'm child free it's what I do, so I'm not sure what I'll do instead this month. I guess I could go hang out at the library and read! Any suggestions?

What I expect to gain from the no-spend month

Only 3 days to go! I'm getting pretty excited about my month of reigning in the spending, so much so that I've already given up cafes! It's been 2 days now but feels like weeks...

So what am I hoping to gain from this little experiment? I hope to change my spending behaviour and for this to be an ongoing lifestyle, not just for the month. Of course I won't be as strict going forward, but I really want to stop spending so much on groceries and I think switching to a monthly shop (with weekly veggie boxes) would be a really good way for me to do this.

And of course I hope that long term this will save us a substantial amount of money. We have been living like we have two incomes for a year now and it's been me driving this. Having some redundancy money left has caused me to be quite frivolous with my money at times. I'm constantly planning crazy holidays that we just can't afford at the moment. I really need to accept that our holidays will be camping for the next few years and overseas and interstate holidays can wait until I'm working again.

I also hope that I learn to say no to people and not give into the pressure to spend money. There is a lot of pressure to buy expensive gifts for friends and family, and I also really want to re-think the school friend birthday gifts. I've been averaging $20 per party gift, which is pretty crazy as school has only just started and the party invites are piling up.

There is also pressure to go out for dinners/drinks etc. that is fine occasionally but I think I'll start suggesting more inexpensive outings to people. A bottle of wine at home is a lot cheaper than in a restaurant!

Anyway, it will be interesting to see how we go. I'll post every few days with an update. And I might come begging for food when we run out!

No spend month planning

It probably seems to defeat the purpose a bit, but in order to get through our no-spend month I have done a small amount of preparation. I have 3 small children and things we cannot live without include formula for one child and disposable nappies (only used for night time; we use cloth for the baby during the day).

We also don't eat meat and don't have a freezer full of tofu! So today I stocked up on tofu, soy and oat milk and a few other 'basics' to get us through the month. I do have legumes in the freezer and cupboard, and aim to eat through all of them across the month.

As mentioned in an earlier post, I'm going to get a small fruit and veggie box each week (or maybe just a few times depending on how we go) as I don't have any frozen fruit and veg except for peas. I do have a few canned peas and carrots too, which I fully intend to use!

I think doing this basic pre-planning will avoid me doing a desperate supermarket run in a week's time. However, as I was shopping today for my 'essentials', I did end up getting a few unnecessary items such as dip and veggie burgers from Aldi. This was the perfect example of why I really shouldn't be allowed in shops and why this month will be very good for me!

Another big part of planning was perusing the calendar and working out if there will be some forced spending in the month.

Both our daughters have birthdays next month, but we are sneakily having a joint birthday party for them on the 30th April! We aren't doing gifts for them as want to move away from giving toys to giving them experiences. We have asked that those coming to the party don't bring a gift but contribute to a sandpit fund and child friendly experiences. I'm not sure if this strategy will actually work, but hopefully it does and we can purchase them a sandpit and take them somewhere fun. (We already have a zoo membership which I will be utilising a lot next month!)

The other big event next month is a very good friend's 40th. There is no getting out of contributing to the joint gift, plus we have already booked a babysitter for the night. I'm going to just write this one off as breaking the no-spend month. My friend is worth it!!

I also needed to find my son an outfit for his school concert - yellow and white clothing with no logos. As we had nothing fitting the bill, I got lucky at an op shop today and found a white tshirt and yellow shorts in his size! A bit more than I wanted to spend at $7 but far cheaper than new. And in before the month of May starts!

No spend May: my rules

So May will be a 'no spend' month for our family. There are going to be obvious exceptions to this rule.

As with most 'no spend' challenges, bills, rent, and any medical expenses are not included.

Obvious no-no's will be: eating/drinking out, take-away coffees, retail spending (no purchasing of clothes, gifts etc.), and supermarket groceries.

In terms of groceries, I'm going to allow us a small fruit and veggie box each week ($40 from CERES Fair Food), as we only really have silverbeet in the garden and we would starve otherwise! We have basic grains and legumes in the cupboard (I regularly try to eat through our cupboards), but we still need some fresh food. I'll also allow $4 a week for a few loaves of bread for the kid's lunches and breakfasts. I'll get Adrian to pick up the bread so I don't need to go near the shops (the veg box is picked up from someone's house).

I'll make sure that I have the basics covered for the month (eg toilet paper and nappies) - see my next post on planning. But I won't stockpile.

I'm going to allow use of my Myki travel card (which has $30 on it at the moment). I'll try to limit my use of the car, but we will need it to visit my Dad's farm so I'll make sure there is a full tank at the start of the month.

Spending out of control!

It's been over a year since I received a redundancy and left work to have baby number 3. Before I left work I fine-tuned our budget and knew I would have to reign in my spending significantly if I wanted to take a few (maybe up to 5) years off. All very good in theory.

However, since being at home I have managed to spend outrageously, particularly in the following categories:

• Groceries - way out of control due to a proximity to the shops and lack of meal planning. I'll order a vegie box, as well as hit Coles and the local health food stores, usually getting 'just a few things' every couple of days. We have been spending over $250 a week. Some families (particularly those who are on 'Simple Savings') spend this in a month! I also spend a lot on alcohol...
• Eating out - we don't go to fancy restaurants or even get take-away meals - our downfall is cafes! I drink soy and a soy latte is often over $4 - usually around $4.50. Some cafes also charge exhorbitantly for baby-cinos, so a quick cafe trip can cost $7. Throw in a muffin or slice and there's $12 gone. Take the whole family out for a coffee and a treat and you blow $25. I have really tried to cut down my cafe visits, but they have become my source of fun and are also my escape when I'm child free. I have a coffee machine at home and really just need to change my mindset.
• Other areas of over-spending include clothes (for myself and the kids - I really need to start op shopping again and asking if I really need it), kids parties and gifts (so many 6 year old parties!).

No matter how many times I review our budget (yes, we actually have one, but not that I follow or check it!) it really is just old habits are very hard to break.

I'm the sort of person who needs a challenge to change things up. I recently read about a Canadian pair who did a 'no spend' year. Then I started googling and found many others who have done a similar thing. I was inspired. But Adrian was not so keen on having a 'no fun' year.

Then I came across the much more common 'no spend month'. Many people have blogged about their experience of not spending at all (except for bills and medical) for a month. You can make up your own rules of course, and this appeals to me, as I think it will be a good way to break habits. Adrian is willing to jump on board for a month too so that is what we are going to do! 4 days and counting...