Living Differently

My wife to be and son are napping at the moment so I thought I would take the time to type something up that I've been thinking about over the last two or three days. 

It all started with Maria's post over at the Money Principle, a great article that made me look differently at the Marxist theory. I then stumbled upon the art of non-conformity, another great article about how people don't understand, from flicking through Maria's "Money blogs" links.

I still love the fact that Maria is flustered by my milk and caviar comment from one of her old posts. I still can't understand how she thinks £120k is "enough". That's where the second article came in. Maybe she just doesn't understand the route a lot of people are now taking. 

People aren't just looking to make small changes anymore, a lot of people really want a wholesale upending of everything they do. Maybe because they're bored of their work, or where they live or they are just sick of the day to day of broken Britain. 

So maybe it's time to take the advice of the non-conformists. Maybe looking at life from a different angle is required.

A zero based budgeting approach comes to mind, whereby we scrap the budgeting tools we've used before and start with a blank page. What do we really NEED in our lives.

Humans usually need a few basics, water, food, shelter. Everything else are things we add for comfort or at the extreme greed. 

So maybe we shouldn't start looking to reduce our mortgage rate, or look to save on our car insurance, we should probably look at cheaper places to live other than houses and maybe start thinking about getting rid of the car altogether.

These are the kinds of changes that can turn an ordinary person into an early retiree or at least someone that is not forced to go to work to fund a lifestyle beyond their own means.

That is the kind of person that for me has really got life sorted in their own head, they’ve no need for superfluous items and their comforts come from within.

This kind of lifestyle leans itself to one where families spend more time with each other and learn how to do things for themselves rather than outsourcing at higher costs. Where skills are nurtured from an early age and progress with each passing project, without being put aside because we’re “late for Corrie”!

I looked at my own budget took out mortgage, car, and media costs and immediately my spending went from 80% of my wages down to 42%. This budget still leaves room for luxuries. With a savings rate like that I could retire in 11 years, which seems like a long time, but I am earning a sixth of that £120k and supporting 3 people!

Sounds pretty awesome to me, just imagine if I could double my salary… it drops to 6 years! As Paul Whitehouse once said… BRILLIANT!!

Of course this is unfortunately a pipe dream until I can convince the other half to move to a narrow boat and cycle everywhere ;)

The Banter Requirement

First of all, HAPPY NEW YEAR! 

It's a time of opportunities! So having this in mind I made a few changes. 

The small win first. My broadband / phone. I'm currently with Sky for both of this. There service is alright, I've never had much downtime on anything. There prices aren't too bad either. 

One thing that has annoyed me though, they continually raise their prices! Mine has increased by 21% this year! That is a little bit above inflation. 

Then they have the audacity to ring me to try and sell me other services! Don't they know we're in recession?!

Well, I'm having none of this. So I asked the nice lady if there was any way to reduce my bills. So she puts me through to a nice guy who turns out to be from just down the road from me, he goes through my bill with me and as I already knew, he can't give me any savings either, not without reducing my service anyway. Which isn't good enough realy is it. Considering they are shafting me for an extra 21% more a month! The nice man mentions that using the good old, "I'm gonna leave unless you give me some money off" tactic might help. Then puts me through to cancellations, the lovely Juliet in Edinburgh. Again after five minutes of going through my account she offers me 10% off my bills for the next 12 months. Not exactly the best thing considering the 21% INCREASE! But hey, I've already been on the phone for half an hour and am getting bored. So I wished her a happy new year and moved on with my life.

The good thing about letting them ring me and using this opportunity to reduce my bills is that I don't have to pay for the call! Normally I'd have to ring an 0845 number which from my mobile can be up to 45p a minute. This call could have cost me £13.50! This money is better off in my pocket and I'm happy to keep it there.

The other bigger win was with my mobile. I'm probably the same as most of you and had a mobile phone for a long time now. To be honest I've been paying over the odds for the service I get. So I thought I'd shop around. My contract actually ran out on Christmas Day which is handy and I've seen quite a good deal, with a free spanking new phone - OOOH! So I rang T-mobile my current provider, they said they can't compete with that and put me through to disconnections. Fair enough I thought, and was planning my trip to Tesco. 

The helpful lady at disconnections asked what the deal was, again repeated that they couldn't compete but asked for 5 minutes to speak to their third party provider chitterchatter, she then duly rang me back and announced that the deal could be beaten, they will do more minutes, more texts, more internet for less a month. Ermmm....ok! 

So end result I'm saving almost £10 a month from my mobile alone. To make this money I'd need £5628 ( basically a full cash ISA) earning 2% interest. 

To get these savings I've just had to do a bit of research, then ring them (or let them ring me), being willing to leave makes it easier. Then just have a chat, make sure they realise your a person, not just a phone call - ask them how they are. Have some Banter with them - calling the guy from Derbyshire a sheep shagger on New Year's Eve seemed to help! Relate to them, they called me at work, so I asked if it was busy, I told them I was at work - I knew it wouldn't be we could both relate to this. 

The fact that just having a bit of banter with someone on the end of the phone has saved me this much money is a huge win for me.

I'm going to be doing more of this, think home/car insurance, mortgage. hopefully these larger expenses will bring larger rewards.

Here's to the new year, bring it on buddy!

Stay well

Dom

Image: By Jon Sullivan 

Well done!!!

Source: Wikimedia commons

A lot of bloggers this time of year are doing their yearly reviews. I think I've already covered most of my good news and my plans for the coming year. So I guess I'll cover current affairs. 

You may or may not have realised that the end of the world didn't happen yesterday as "predicted". I'm glad because I wouldn't have been able to read Monevator's great round up, the highlight for me - "Everyone likes money" - I think we can all at least agree on that. 

The other blog I wanted to point out was mortgagefreeby30, who not only completed his challenge in amazingly quick time, but was also one of the inspirations behind this blog. Well done! Mike has worked really hard on a side hustle, to help him pay off his mortgage. What's next for him? Holidays and a well earned rest I think!

Make it count.

So what's the next step? I've been thinking a lot about whether retiring early is really what I want to do. I think it's a difficult decision to make with the thick end of 70 years in front of me. So I'll just let future Dom worry about it. 

For now I'm still going to concentrate on living well and on a lot lower level of consumerism than the average Joe. 

The new focus will be making each pound count. This thought came to me after talking about Christmas shopping.

Someone told me I was a scrooge for setting spending limits on peoples presents. I tried to educate them in the ways of frugal living. Obviously they didn't get it, FI/RE didn't appeal to them (how would I afford my trip to Disney Land?! WAH WAH). 

So I tried a different tack - not wasting money - squeezing every penny from every pound. Getting exactly your money's worth, if not more! This means not wasting and maybe accepting all the good stuff that comes with this. 

Another benefit of living this way is the change in mindset. You are no longer thinking oh I'll get so and so this jokey gift, they'll think it's hilarious. You start thinking, this joke gift would be hilarious but after 5 mins it would be binned, maybe this useful gift would help them out with that problem they were talking about, or maybe even - hmm, they don't really need anything maybe I'll just focus on cooking a really excellent meal that will be enjoyed by all. Or get a good board game that can get all the family involved in some banter and maybe even let us turn the TV off for half an hour.

Installing this kind of thought pattern has really helped me so far. Or should I say reinstalling? I believe this is what we all grow up having then as consumerism grinds down our conscious thought into the "what to buy nextathon" that is Christmas / sale shopping.

Anyway, hopefully this will be a little food for thought.

Enjoy your holidays.

Stay well.

Dom

Is one income for a family enough?

I've been thinking more and more about the past recently. Mainly on how it has affected my family.

After having a few conversations with my Dad over the last week or two, it became apparent how little I know about the country and even the town I grew up in before I was about 16-17 years old and started paying a bit more attention (not a lot of attention).

The growth of standards of living have gone up enormously. I would say most people in Britain now live in houses that have some kind of heating. This wasn't so up to even 20 years ago.

I couldn't even fathom this. I took it completely as a given that everyone had heating, electric lights and a power shower*!

Then you start thinking about other "technologies" that have bedded themselves in just in my lifetime (I'm still young I tell thee!), think of mobile phones, solar panels, efficient cars.

I remember growing up, not that long ago, in the mid 90's having to wait for my sister to finish her phone call on the landline so I could ring my friend. This is completely unheard of now. You just whip out your mobile and bam, text your friend, send them a picture of a particularlly long cat or whatever.

You can even speak to a friend in Australia whilst walking through the countryside of Cumbria (if you can get signal). Come on, that is amazing. 

I guess we take these things as read now. 

Anyway, back to my point. Have these technological advancements increased the costs of the standard persons life. 

Well there's one thing I can see stick out like a sore thumb. How many couples do you know now, where both of them work full-time, I would say over 95% of the people I know do and hate it! 

Do they do it because they are chasing Financial independence and want to retire early? No, is it because they love their work and wouldn't give it up for BILLIONS OF DOLLARS? Nope. 

It's because if they didn't both work they couldn't afford to live. It's as simple as that. You now have single mums working full-time to fund their child care costs. Couples working 80-100 hours a week between them to try and afford the wedding they just have to have.

So are we better off than my parents generation? Yeah! We live in comfy ass homes where you flick a switch for heat, with fancy insulation that retains the heat and drive a car EACH to our jobs that we want to try and excel in because goddamnit I am good at this.

But if I could swap for one of us working a 40 hour week, not having a mobile/laptop/internet/abroad holidays and having every weekend free, to give my other half a rest because the kids have been running riot all week. I would in a heartbeat.

I think as much as possible, I'm going to cut out that excess crap until I'm at the "bare minimum" for living a modern life. But am riding a rocket ship compared to peoples lives in the 80-90's. 

Hopefully, these technological advances that seem to have turned us into a nation of workaholics can be kept at bay with a little effort and a little thought and I can live well, because really that's all that matters.

Stay well,

Dom


* A power/electric shower is one of my necessities for life, along with double glazing and love :D

picture: longcat

Indulgences / Temptation

It seems Briton is spending itself rotten at the moment who would have thought we're only just out of recession. 

So I thought I'd get involved!! But in my own way. I love indulging my thoughts having a look through the latest gadgets, or maybe some new shoes. But the difference is I have the mindset that I can't afford these things. 

Why can't I afford them? Am I really poor. Well no, I have a good job. I earn a decent amount, I've worked hard to get where I am and I hope am going to get further up the career ladder. 

So? What's the problem? Why aren't you busting down the road in your brand new puma's or writing this on the new ipad 3 with 4G technology? 

Well... there is a problem I have to admit. I cannot bring myself to spend my hard earned on such frivolous things, especially when I have much more important things in my life.

Like what? You might be thinking, you've worked hard, treat yourself go on! Worked hard? How can you measure that. Yes I think I have worked hard, maybe a little too hard, but I always think I could have done so much more. How can I justify treating myself? I don't think I can. I already have so much. 

Come on people. When you were 8 would you have ever believed that you would be walking round with a star trek style communicator that allows you to talk to someone on the other side of the world!!!! If I think about it I kind of can't believe it now. I think it works through pixie dust though!!

Maybe I am already treating  myself, I cook up yummy meals for myself every night and get to hang out with really cool friends and my life is generally pretty awesome. Would it be improved with the latest gadget? I think not.  

I love looking though.

Looking for a side hustle

What a weekend it's been. The weather has been crap, mostly. So like a lot of people it has made me look inward. 

I've pretty much got my budget in order, so what next? 

Well as MMM says, it's spending and income or income and spending. So income then. I'm pretty settled in my job. Ha guess what I'm not paid enough though! So I could either work harder on cutting my costs, or get a side hustle!!

Side hustles can range from a fully blown part-time job, which works well for some, to earning a few quid filling in questionnaires.

I've done both in the past and enjoyed neither very much. Probably because I have this little thought constantly ticking along in my head that I'm worth more!! $25 doesn't seem like that much though, I was thinking more like £50. 

So what side hustles could stand up to my (probably inflated) sense of worth? Well  £50 translates to £104k a year. I think earning that much is probably a little out of my league at the moment. Unless I break it down.

So today I did some painting. No, I'm not the new Van Gogh, it was more for decoration purposes. So what's this got to do with side hustles? Well I had a look on myhammer and to paint a four bedroom flat they were quoting £1000! Shit I thought, I effectively saved that much today. Although we did only one room, so only £250, but how long did it take us? 5 hours, woohoo that's £50 an hour! Where's the champagne?

Yes, this is simplistic, it ignores the cost of the paint we bought and there was two of us doing it. 

So maybe not quite living the dream yet, but I guess it depends on your dream.

Laugh

I had to laugh today, quite a few people were late into work today due to some bad traffic that had closed a road nearby. People were saying "oh dear, it took me over an hour longer to get into work today" so I asked how long in total they were in the car "oh, two hours, so I guess it wasn't that much more". 

I sort of lost my cool and started laughing at them (very not cool of me I know, I'm sure karma will kick my ass for it later!)

Don't these people realise how much of their time they're wasting? 

One person I talked to him and his wife commute over an hour each, each way! These people are incredibly intelligent people, they have both progressed in their careers to quite senior positions, what the hell do they think they're doing? 

I also love the fact that they complain about how little time they get to spend with their kids. Or how they don't seem to sleep very well and don't know why!!

I must admit before I had my epiphany, I was the same as them. Now I've realised what a huge waste it is it actually gets me a little angry that these actions are allowed to take place. 

Now I've realised don't get angry I can't force these people to do what I want, so instead I just laugh. Although I'll try not to do it right in their faces next time!

Oh well, we live and learn.

Motivation

I've always struggled with motivation. I always blamed it on being plain lazy. I'm still pretty lazy now, but I have got better.

One of the things I've found that helps me out of the rut is picturing the end. Whether it be the finished masterpiece or the pay rise that will (hopefully) await me.

As you can tell from the rest of my blog I try to save as much as possible. As I'm just starting out I don't have a lot of savings. I thought the best place to start saving was in a tax sheltered ISA. This type of savings account allows all interest or capital gains to come to me tax free. 

Great! I thought so I looked around for the best rates and what did I see? Bum all! 3% was the best I could get without tying myself in for 3-4 years. As I will probably need to tap this cash in the next 12-18 months I had to put this limit in place.

So as you can probably tell I'm not earning a lot of interest. This has caused me some concern, is it really worth saving all this money if I hardly earn any interest? 

Then I had an epiphany today. I got my water bill! Hardly the most exciting news ever. But   when I saw the amount I thought OUCH! Is that just for water? Then I looked a little closer, it was for 4 months of water usage, so it then didn't seem too bad.

Then I had another thought, even my small ISA balance with it's paltry savings rate has allowed me to earn as much interest as this entire water bill!

Then I thought, someday I'll have enough saved up to earn enough interest to pay all my bills!! 

So now all I want to do is save as much as humanly possible to get to this end point as quickly as possible!!! 

Any tips on how to do this would be brilliant!

Picture: http://www.flickr.com/photos/teosaurio/

Struggle

I've been struggling over writing a post all about how I feel about happiness. I'm finding it difficult to put the words together that define exactly what it means to me. As you can probably guess I don't buy into the regular short term buy your way out of sadness idea.

So here's something completely different while I mull over that. 

A few blogs I follow have been banging on about the Blog-up event, it sounds like a laugh a minute I have to say. Maybe a little bit corporate? Or am I being a little cynical - hey if they were able to drag the ermine away from the Stella bashing, all is good in my eyes!!

In other places, MMM has highlighted the upsides of p2p lending, I've looked into it and would like to have a go at some point - I would also like to have "play" money to test out these ideas. I hope he doesn't start thinking he's winning monopoly as that would be a dire shame, his head does seem in the right place though. Hopefully we'll see the good affects of a moral and wise investor giving back. Maybe something we can all learn from.

Otherwise it has been a quiet week, a gem from the other side of the sea has popped up in the shape of http://whatstostopyou.blogspot.co.uk/ after having a short read through, his ideas seem very close to my heart, along with an acute financial brain (spot the economist / accountant!!), I also love the wonderful moment of the day.

Which brings me back round to my work in progress post, I love taking a moment each day to find a bright point. Even when the auditors are breathing down your neck and you know you won't get home til 8 :(

Picture: www.picturesdepot.com