I have posted before about my interest in Peak Oil and how it will impact fuel prices and the flow on effect for basically every product on the planet.

Yesterday I really FELT it!

When I was driving the 7.5 km to work I noticed that the fuel price at the United fuel station was $136.7 ( for the green fuel that I use) while across the road at the Coles Service Station it was $1.47. I suddenly remembered hearing on the ABC news the night before that fuel prices were meant to go to $1.50 for Easter and that fuel had hit a $108 US a barrel. I also remembered that this particular fuel station was often the last one to put up their prices.

I did a quick U -Turn and filled the car up, at the same time calling and texting everyone I thought would be interested to fill up before the price hike. I note that earlier in the week the price had already jumped 9 cents a litre.

So… I filled up my car ($70 gulp~!!) and hubbie filled up his ( $120 ~gulp gulp!!!). Sure enough, on the way home I noticed that it was $1.47. That is a TWENTY CENT LEAP IN SEVEN DAYS !!!!

At present, I budget $30 for my car and $20 for hubbies car a week ( just dropped hubbie’s from $30) I can tell you that $20 at this rate is just JZZZZZTTTTTTT click ! ( meaning it takes NO time at all before you hit 20 bucks !

So….. what to do. I could walk or ride to work… but it’s always about time. Hubbie walked to town today to pick up his new pushbike because he had ridden the other one into the ground, literally, the axel broke beyond repair and he already rebuilt it once. It took him one hour and 10 minutes. I just don’t have that at the start and end of each day. In a couple of weeks it will be dark when I walk home and there are sections that are just road, with no houses and no street lights. I live in a little town, outside a bigger regional centre. He rode the bike home which took about 20 minutes ( he is much fitter than I am. It would probably take me 45mins)

I could ride my bike, something I would really aspire to do. Logistically this is messy. I am a professional. I wear suits. Can I scrunch the suit into a backpack ? Can I shower at work ? Can I cart make – up? Can I do my hair at work ? I know, I know. Dump the societal expectations and not wear make up and don’t do your hair. Unfortunately, the clothes maketh the man in my game, or should I say, the suit, hair and make up maketh the woman in a man’s world ! LOL

Hmmmmm…… thoughts anyone ? ?

After a successful shopping trip on Monday the stockpile is up and running again. If you haven’t heard of this concept before, my aim is to have enough ’stores’ built up in my cupboard that I only purchase things when they are on special.
I have been doing this for so long now that I have a sense of the rotation of the specials, that is, that Vegemite may come on sale every five weeks and during that time my family will use 3 jars so when it comes on special I will buy 4 jars to cover it.
If you’re just starting out, take a percentage of your grocery money and use it to build up your stockpile. Each week you can devote more money to the specials and then you are left with a base line of weekly things that need to be purchased. If there are no specials to be purchased in a particular week the money just goes in the jar for next week.
I have found that I save so much money shopping this way and can ‘eat out of my cupboard or freezer’ any time I need to which is great in emergencies or when you want to save all your grocery money one week or if you are so busy you can’t go and do a ‘proper shop’. It prevents you from doing 4 runs to the grocery store a week to get ‘ just a couple of things’ which over the week adds up to more than your usual budgeted amount.

We hear all the time about how much money we can save. We see it in shops – save $15, save 30% or we read about people cutting $25 a week off their groceries.

But are these really savings ? and if they are where does the money go ? I am quickly realising that most so called ‘ savings’ should really be called ‘ not spending’, in that unless you were actually intending to spend, for example, $100 on an item and you only had to spend $80 and invested the $20 – then that is a true ’saving’.

Lets look at it this way.

When doing our budgets we go through and ‘reduce’ our outgoings – $5 a month here, $2 a month there etc etc. – adding up to $400 saving a month and a whopping $5000 saving a year. But do we actually invest that saving and earn interest off it and add to it and make it grow ? Or is it simply money that we could have spent but didn’t!

I am going to make sure that I ’scoop off’ all the little ’savings’ I find. For example, when I budget $150 for the weekly groceries but only spend $125 I will put some aside for weeks when I need to spend more to stock up and I will scoop off some and put in my ‘never to be touched’ savings account. I think in this category a 50/50 split with the leftovers will be good.

Are you frugal, do you work hard to save money …. do you channel that money into savings or into debt reduction ? Post your ideas here.

I am currently preparing to do the $21 challenge at Simple Savings ( see my link at the right hand side). The reason that I am preparing this is that I have to really think about how I will tackle it. The idea is to be able to feed your family for a week for $21. You don’t have to do this all the time, but doing it from time to time means that once a month or so you have a considerable chunk of your budget not spent.
You are allowed to use things from the pantry that you already have, so the $21 doesn’t have to buy every little ingredient.
Is anyone keen to have a go or at least swap some recipe ideas ? There are two adults and two children aged 6 and 9 in my family.

Develop a Plan and Organise a System For Paying Your Bills

If you have bills arriving in the mail that you didn’t know were coming or you suddenly can’t afford to pay for something else because you have to pay this bill, you are allowing your bills to control YOU, instead of you controlling them.
To prevent this, you must have a plan and you must work your plan into a system.
Firstly, list your big expenses throughout the year. These may include electricity, water, school fees, registrations, insurances etc. If you are unsure when these bills fall, then mark them on a summary sheet which is divided into 12 boxes, one for each month, as they come in through the year. Knowing what is on your horizon will enable you to plan for the larger expenses rather than dreading them when the bill arrives in the mail.

To control the bills I have a system whereby I tally up every bill that I expect to come in throughout the year. I look back through old calendars and bank statements to get an accurate list. I then add the total of all the bills for the year. After I get up off the floor and recover from the shock I divide this amount by 52 or 26 if you work on a fortnightly budget and then know that this is the amount that I have to put aside. My version of “put aside” is to transfer it into an account that is only for bills. I don’t touch this money, except for bills. Depending on how much control you need over your finances, you may choose to have a plastic bag for each bill, whereby you put $20 a week into the electricity bill bag etc. Some people choose to do a bpay electronic transfer to each company so by the time the bill comes in, the amount is in credit or close to zero. The choice is yours. The only rule is that it has to be “a system” that is, something that is not too complicated and works for you. If you are the type of person that simply can’t have cash on hand because you are impulsive then don’t choose the method where you hang onto the cash. You would be better of paying each company a small amount each fortnight.

When a bill comes in I write the due date on the calendar and the amount. I then have an “unpaid bills” clip that stand on my desk. One of my jobs on Mondays is to look at my budget and pay any bills. I pay the ones that are due in the upcoming week. I also write a list of bills that I have paid so I can see at a glance how much variance in, for example, mobile bills over the past few months.

As you know from my previous posts we work on a cash only basis for our day to day expenses and for our savings. See my previous post for how I actually do this. http://avisionsplendid.blogspot.com/2007/07/working-with-cash-budget.html

To take away financial stress you have to be in control. Otherwise your money management is like a giant wave that keeps knocking you down every time you try to stand up. Removing financial stress will allow you to concentrate on more important things, like building quality family relationships and having a more peaceful, simplified family life.

Let me know how you are going via email or comments. If you have any helpful hints on how you reduce financial stress in your family, please let us all know.

STEP TWO: KNOW WHERE YOU ARE FINANCIALLY AT ALL TIMES.

We have embarked on a journey to take control and create a better and simpler life for ourselves and our families. Before we get into the nitty gritty we are doing some preliminary steps which are financial. Money is not the most important thing in our lives, but it plays a big role in our stress levels and can even cause relationship breakdown. We will therefore attempt to remove that stress by managing what we have and this will enable us to focus on things that truly matter.

So, in your notebook make a ’starting point’ page.
1. Head it with today’s date.
2. List ALL the money you have – every bank account, every wallet, every purse, every money box. Don’t list what you owe here, there will be a separate table for that.
3. Now list all the money you owe. This includes mortgages, credit cards, personal loans, loans to friends or family, lay-bys etc
4. Now, make a summary :

TOTAL WE HAVE: ___________________________

TOTAL WE OWE:_____________________________

Now that you have faced your financial truth you can start taking some steps to improve your situation. It is also helpful to mark a date on your calendar for 3 months down the track to do this again and look at how you have improved. If you want to keep a tighter reign on things you might re-do this sheet monthly. If you are really taking this seriously, you may even graph your progress so that what you have is in one colour and you can see that line going up, and what you owe is in another colour and you can see that line going down.

Don’t be too frightened by the results. It is important to know where you are so that you can map out where you are heading. Burying your head in the sand will only make your situation worse. Take control !

Don’t forget to give me some feedback. Email me with your results or let me know how it feels to face the truth!