My Simple Financial Plan

DH just took the car to the repairer yesterday to get the brakes fix. It cost $273, the cheapest one we could find. Other places were quoting as double that!

We also just received our annual car insurance the other day, it is due on the 17th of Jan. It's over $677.

Paid Gas and Electric bill the other too. All up it was $158.86. The electric bill is a bit high, it has been really hot around here. New years day it got to 42 deg Celcius and didn't get below 30deg until 5am the next morning. So our air conditioner has been getting a work out. Today it will be 37deg, same as yesterday. It's bloody hot!

This is going to be our version of the $20 Challenge.



Our challenge for 2008 is to keep these items in the list under $20K for 2008. As can be seen, we spent over $23K+ on these items in 2007. Conservatively, we probably should budget $22K for these stuff but this is not called a challenge for nothing! I love a challenge, and so we are turning the knob a little bit tighter. I think if we can reduce the grocery, entertainment, gifts and miscellaneous items we should be able to do it. I do anticipate that the entertainment and gifts will be a lot lower this year (won’t be spending as much this year for our anniversary).
I’m already accounting for an increase in the utility bills (there has been a lot of talk in the media about this already). Property rate has already increase for the last 6 months and will continue for the next 6 months and will most likely increase further after that. Have increase the home phone but will try to not use the mobile phone as much. Our internet usage can be erratic, to be in the safe side I have increase it. Fuel should be lower this year since our gas conversion. Fare will be increasing in the middle of the year as per usual. For insurances, I just hope they won’t go up too much but we are already planning to increase our coverage for the health insurance (to include maternity) around the middle of the year. The amount for the Personal/Medical will not include the surgery that was meant for Dec in here (in my 2008 year budget I have put this as a separate item). I have lowered this quiet a bit, there were stuff that we did last year that we shouldn’t need this year, eg. I won’t need contact lenses I got enough that should last for over a year. The miscellaneous item is really the thing that I hope we can really keep down. Need to be more discipline about not buying useless stuff.
I would really like to save $3K for these items this year. That $3K would really be great contribution to the holiday fund (as a reward).
Things that are not in the ($20K challenge) list but are in the 2008 spending plan are:
Mortgage -$16,200
CC repayments – Will be paying minimum and will reassess at the end of the year on whether we want to just pay it off or not - $1,600
Medical (surgery) Expense - ~$1000
Tuitions – Depends on how many subject will be doing this year, still undecided (kind of playing it by ear on how busy it is at work) - $3,100 maybe
Text Books – Depends on above decision - $420 maybe
Various Funds:
Baby Fund - $50p/m ($600)
Car Fund - $150 p/m ($1,800)
EF - $50 p/m + some from extra income (until fully funded - $3000, only need $1K now) ($600)
Xmas Fund - $70 p/m ($840)
Repair/Furniture Fund - $500 p/m (planning to make some major repairs this year) ($6000)
Holiday Fund - $350 p/m (but if we can achieve our $20K challenge we won’t need to put away as much and will put more in the savings) ($4,200)
Various Retirement and Investments - $330 p/m ($4,000)

LONG TERM SAVINGS - $500 p/m + whatever extra left in the month’s income ($6,000).


I am really excited about 2008 it’s going to be a great year.

Okay finally got all the final totals for December. We managed to save 25% of our income this month. It was actually more but I decided to put $200 into the Car Fund, $50 in the EF and $250 into upcoming Medical expense.

So these are the final numbers for 2007 goals:
1. Pay $11,500 off cc by July.
Total Paid = $10,014 (83%)
NG: Pay $12,000 off CC in 2007.
Updated:25/11/07

2. Pay off Personal Loan ~ $3,000 (around $2,100 left).
Total Paid = $2034.50 (100%)
NG: Pay off Personal Loan by July.
PAID OFF 19/07/07

3. Contribute $1,000 to Ret Fund.
Current Total = $1,750 (175%)
DONE June 07

4. Have $3,000 EF.
Current Total = $2,000 (66%)

5. Have $5,000 Saving.
Current Total = $13,375.72
(267%)

6. Have $1,000 Car Fund.
TTD = $2,050 (205%)
Deduct = $247.00 (Service & Batt)
Deduct = $550 (LPG & Parts)
Deduct = $575.40 (Car Rego)
Current Total = $677.60

7. Have $3,000 Holiday Fund.
TTD = $3,600.00 (120%)
Deduct= $540.33 (April Holiday)
Deduct= $2,888.69(O'seas Holiday)
Current Total = $128.18

8. Have $1,000 Xmas Fund.
Current Total = $655 (65%)
Xmas Spending = $633.62

9. Put $5,000 into Investment.
Current Total = $5,198 (103%)
DONE Dec 07

This is our overall financial performance for 2007:



EDIT: For some reason I my pie chart is not showing. SO I will just write it out.

Debt Repayments - 33%
Household Expenses - 13%
Transportation Expenses - 5%
Insurance Expenses - 3%
Educational Expenses - 5%
Other Expenses - 10%
Superannuation (Retirement) - 2% (this does not included our employers compulsory contribution which should be 9% of our pre-tax income).
Shares (Investments) - 7%
Mini Savings - 6% (these are cash savings for near future expenses, I really see this as an expense as well not as a saving.
SAVINGS - 16%

Hopefully this year we will have a higher percentage in the saving and investment items

Well, it has been a great year, and we hope to have an even better year in 2008.
I’ve been blogging for almost a year now. One of the best things I did this year was to put my goals in my blog where I got to see it almost every day. I didn’t quite achieve all my goals; however, I was aiming really high.

What have we achieved this year?

Credit Card debt – we managed to pay off more than 2/3rd of our CC debt. We could pay it all off now but choose not to. For us it makes more sense to put the money in the mortgage redraw account instead because of its higher interest rate. Will most likely get rid of it by the end of 2008 (maybe?).

Personal Loan and Retirement – The personal loan was paid off half way through the year. We used to pay $40 a week for this loan. We now used half of that amount to fund my retirement account, which the Australian government match it by 150%. Unfortunately, they only match up to $1K, that’s why I only put $40 every two weeks.

Emergency Fund – Sad to say that we only achieved 65% of this goal but might still have a bit of money to put in at the end of this month. I guess this wasn’t high in our priority list mainly because the saving in the redraw account of our mortgage can also be thought of as our EF but I really don’t want to think of this way. I really don’t want to touch that money unless we really really really have to. I’ve decided next year I’m going to set up a regular deposit into this account, plus any extra money I could find until it is fully funded.

Long Term Saving (Redraw Account) – It’s looking like that after this month we should have almost $14K into this account (although I will probably take some money out to put in the medical fund and other slush funds that need extra funding). So overall, we should have at least $13K into this account, which means we more than double my saving goal! We should be able to double this amount next year because DH will be receiving a big bonus and a severance payment after the work his working now finishes. The great thing is he already has a new job line up.

Car Fund – Although we more than achieved the goal, I would have really like to have a bit more in there to start saving for our next car. Also, our car insurance should be due next month (haven’t received the bill yet but I think it will be coming soon), which means this fund will be deflated even further. I think next year I will have a separate account for the car registration and car insurance as the Car Fund (for repairs and money towards the new car).

Holiday Fund – we are 20% over the budget but no regret what so ever. Next year will be more than this year we are already planning a nice couple of holidays. We will have to budget $5-$6K for it, I think. Of course, will try to spend less than that.

Christmas Fund – although was not fully funded we managed to have a great Christmas without going over the budget.
Investments – this went beyond my expectation, I really didn’t think we would have been able to achieve this one but somehow it did. This amount is not even including interests and/or dividends that we received.

Overall, this year our Net Worth surpassed the $100K mark.

Just cash in DH 2005 tax refund today, as promised I will put some of it to the EF. But decided to only put $300 (instead of $500 as I initially wanted) and put the $200 towards a medical expense that is schedule for some time in the next two months. I've already set up a Fund for it last month and already got $250, so this would make it $450 (about half way there). I might even put more money in it at the end of this month, depends how much saving we have at the end of this month.

Well, we managed to stay under budget. We still got just over $21 left in the Xmas fund.
I think I will use the left over for NY eve celebration. Our christmas was good, ate too much as per usual. Spent most of it buying great gifts. Just love giving gifts. It's great to have money set a side for this kind of occassions, no stress at all. We will be doing it again next year. I'm thinking of putting $70 p/month for it.

I'm still tinkering with my spending plan for next year, pretty much done. I'm getting really excited about next year, we will be focusing more on investing and saving. There will be quiet a bit of money coming in around early next year.

We are about to open 2 managed funds (maybe be 2?), domestic and international. Pretty much decided which once ones we want to get, we already got the money set aside for it (from the company shares that we sold few months ago). We will then be putting $100 p/m for each funds. Hoping to keep these for at least 10years or more, maybe until retirement. We'll see.

Overall, our spending this year has been very good, way better than the previous years. But I would like to do even better next year. I've already told DH of an idea I got on lowering our expenses (it will be our personal challenge for 2008), he seems to be with me in this one. I am in the process of putting together a plan to achieve this goal/challenge. And will blog about it once it's done. In my head it's achievable!

It has a link to the savingadvice forum.

http://money.cnn.com/2007/11/29/pf/bestweb_tracking.moneymag/index.htm?postversion=2007120413

I'm still trying to do our 2008 budget. I'm using this year's actual figures to base my 2008 budget, although there will be some extra spending next year. Holiday expense most likely be higher and also thinking of doing some house repairs next year. Dental/Med/Personal expense will defintely be higher also.

Another thing that will be happening next year is some major changes in DH employment situation. There should be a bit more money coming in next year, which I can't wait.

Once I get all my budget done, DH and I will then look at it together to see if he got any other suggestions/input.

He will be getting some company shares, worth around $700+. That pushes us over the $5,000 mark, which means Goal #9 is now done.

A lot has been happening here, financially, for the last week. This could be a long post, unless I get tired.

Firstly, we finally got our car converted from "petrol" to "LPG (gas)". It cost $2400 but it was only $400 out of pocket because we will be able to get a $2,000 rebate back from the federal government (which should take 2 weeks to get processed). We should be able to save around 40-60% on our fuel bill from now on. It was interesting to see the difference in prices. Last week before the conversion we filled up the car (although there was still some in the tank) and it cost us $72 whereas the cost to fill up the LPG tank for the first time was only $40, a saving of $32 (44% saving). DH thinks the saving should pay off the conversion in about 5-6 months time. We are planning to keep the car for another 7-10 years. I was thinking to keep budgeting the same amount for fuel per month and will just save up any saving towards the car fund (for repairs, rego, car insurance and for our next "new to us" car).

On another financial news, I counted my coins in my piggy banks and there are $135 that I can add to our xmas fund. In total we have $655. Already spent over $200, already bought turkey and bought about half of the gifts already. Only need to get some seafood (can't do that until the day or two before xmas)and already thought of what to get for the other gifts just needs to get them. Most of the gifts for the inlaws I just got online they live interstate so it was easier and cheaper.

It was spendy yesterday, I bought a lot of clothes, it was planned and did get a lot for my money. Spent $114.89 for 3 tops (work clothes), 2 jackets (work clothes), 1 top and bottom summer pj, and 5 pairs of sport socks.

Well thats it for me for now. Hopefully we will be able to stay under budget for xmas, I will update my total after christmas.

It's that time of the month to update my sidebar numbers.

We managed to save 13% of Nov's income.
I've put a bit more money in the xmas Fund. I will also empty my piggy bank maybe next week, and that money will also go towards the xmas fund.

Last month of this year-long challenge, I can't believe we achieved so much. Budgeting does really help!

This is our Jan-Jun expenses and savings:



I can't believe half of our income went to Debt repayments!

This is what we hope to get in the next 6 months:





I will do more itemised analysis later.

Thanks everyone for your warm welcome and encouragement!

I decided to list more minor goals, these minor goals will help me achieve my big goals for 2007.

1. I will not buy any clothes in the next 6 months except for 2 winter coats and underwear. Clothing budget for the next 6 months is only $150.

2. Cut down on the groceries. I will try to only spend $50 this week, and try to use up what's in the pantry and fridge already.

3. Only spend $50 on entertainment this month.

4. Look into lowering the house insurance premium.

That's it for now.

By writing these down, I will be able to see whether I'm making progress. This is a good habit for me to get into.

hmmm...

Finally taking the plunge to start a financial blog. I thought now will be the best time to start, being a new year and all. I hope to use this blog to keep track of my financial journey.

My 2007 goals:

1. Pay off CC#1 and CC#2 by July 2007 (~ $10,000).

2. Pay off $1,500 of CC#3 by end of July 2007.

3. Pay off personal loan by the end of 2007 (~$3,000).

4. Contribute $1,000 to my retirement fund by the end of 2007.

5. Build up an emergency fund (I've got $500 so far) to $3,000.

6. Have a $5,000 saving by the end of the year.

7. Save $1,000 to put towards a new (second hand) car.

8. Save up for a holiday overseas (~$3,000, I've got about $700 so far).

9. Save $1,000 for next Xmas expenses.

10. Put $5,000 towards long-term investments (shares).

Wish me luck!