Where will money go this year?

The first quarter of the year is gone and here are my family's achievements for the last 3 months.

• Paid off 2 of our 3 credit cards
• Paid our monthly dues before due dates and paid slightly more than what's due - Whew! Look at all those "due" words!
• Gave birth to our wee bub! :)

Paying off our credit cards was courtesy of our savings so at this point we don't have much of it to show for. Yet there are more expenses to come.

• Wedding dinner - We are finally taking the plunge and hosting our dinner at a restaurant that has very good reviews. The easiest, and probably the cheapest, way to host a group of 20-25 people at dinner is to have a set menu. We were looking at $35 per head but we found out that was only good for lunch. We chose the $50 per head set menu (as it was the cheaper of the 2 sets) so roughly our bill would be between $800 and $1,250. Not all the invited are coming I think.
• Wedding bands/rings - We went for a pair of 9 carat white gold bands. I would like to get an 18 carat pair but we could do that later. At this point, we're pretty satisfied with what we got. The rings cost us around $610. We charged it.

So now that you know what our finances have been up to, it is not looking way up eh? The positive side of it all is that our liabilities (debts) are going down. The negative is that we're not saving much, if we're saving at all. This month our internet-phone-cable bill reached its highest at $258. We shared our internet with our downstairs neighbor but we think they were not aware of their usage. Unfortunately here in NZ, it is not common to offer unlimited access. If we are strict about our usage, we are only to pay around $160. Look at that extra $98! Aargh! No, they no longer have access to our internet and we are within our means so far. So that's good.

Another expense coming up is our homecoming trip this December. Just for the tickets for the 3 of us, we're looking at spending $4,600 including taxes and fees. That's if we purchase the tickets soon. That's just the air fare. We are planning to have our christening there as well, which will probably cost us $500. Of course that's not the only expense we're going to have during our month trip. Oh, there will be a new weekly expense introduced by July and that is called daycare, and we're talking about $200/week.

Those so far are our big ticket purchases this year. Top that with paying debts, I don't know how much we will be saving at all this year. That's why I brought up taking on "challenges" with J. I mentioned lowering his allowance to $130 (from $150) or lowering our internet package to $130 (from $160). I agree with him on the allowance that it should remain the same. We agreed that we'll do a review of our internet usage after 3 months. If we remain below our monthly allowance, we'll reduce our package accordingly.

For your child - buy used or new?

The other night J asked me if we made dumb purchases for the baby's things. He asked that if we had bought a $300 stroller instead of a $680 one, would it have been smarter? Instead of an $800 3-in-1 cot, would it have been smarter to buy a used one for $400?

If I thought of the costs, of course cheaper items save money but let me just explain (or justify) the reasons why I chose brand new items for our kid.

3-in-1 Cot
I didn't want to buy a used one with lots of teeth marks on the railings for my child. Some sellers advise to sand the marks but to bother with that, plus repainting if you like, would cost another $50 or maybe $100 more. I also have noticed that the sellers sell their cots after warranty has finished. Of course the cots don't come with mattresses so there's a need to purchase one, which costs between $130 and $200 nowadays.

No warranty, lots of teeth marks, need to get new mattress... uh, no. I think the 3-in-1 cot is worth buying new because the child can use it until he's about 5 feet tall, or about 4 or 5 years old. So I do the usage calculator - price divided by the number of usage. The lower the result, the better for me.

Stroller/Pram
I searched TradeMe and found nothing worthy of my $200 or $300 when I was still on the lookout for one. Some even have rusts on them! Some looked so used and worn out that there is nothing left for my baby to wear out, you know what I mean? I'm not saying that people are selling pitiful strollers on TradeMe, but when I did my searching I didn't find one that suited my taste.

I don't know, but you can say whatever you like about my choices. I draw the line of my frugality somewhere. We decided to rent out our car seat from Plunket and we didn't get a new one for that. We received used clothes and shoes from friends and I didn't mind that. We bought and repainted an old drawer for his clothes. I don't mind getting or receiving old stuff. They just have to be within a certain boundary for me.

Another credit card paid off!

I was staring at our budget-expense spreadsheet yesterday trying to work out a way to pay off some of our consumer debt as soon as possible. Then I had an idea of using a good chunk of our savings to pay off one card. I brought it up with J first, and he thought it was a great idea, and within an hour I made the payment. It feels good to know that we are inching our way into paying all of our debts despite having weak savings. Now we have 2 cards with $0 balances and one more card left to go. If only we have enough savings to pay it off we certainly would. It is our biggest card debt.

There will be upcoming expenses in April that are not part of our monthly items but I know that we will be able to pay them off in no time. It feels great knowing that my family's in good shape and is learning the discipline of money management day by day. Each day I get excited that our lovely boy is growing up, and although he is making us spend more, he pays us back with lots of cute toothless smiles!

If love were to be quantified, I'd be so damn rich! :)

I want our own house

I think I might have mentioned in my past entries that we are going to rent until we pay off the student loan. As this is our biggest debt, and should only be once our CC debts are gone, we planned to pay it off aggressively within a period of less than 5 years. If we pay only the minimum, which we do now, it would take us roughly 8 years to pay it off.

Having my parents with us temporarily meant that they have taken interest in the property market here in NZ. They have been observing (or researching?) the neighborhood and the houses and their selling values. I think that a lot of home owners are trying to beat the crash and burn by selling their properties as soon as they can. My folks can't help but tell me to take advantage of that once the property values have calmed down. I think that they think that's happening soon.

My dilemma is how to take advantage of the property market crash with a big student loan still hanging above our heads. As per my ever wonderful parents, our rent could be part of a mortgage payment that could be slightly higher than rent. Of course they have a point but they don't know about the student loan.

I know it is possible and they cheer me up that J and I can do it. Of course we can despite knowing how tight finances will be as the baby grows. At this moment I think I better head back to sleep and dream of winning that lotto. Sometimes I'm tempted to bet on it at least once a month.

Savings interest rate up a notch. Again!

A month ago, one of my online savings accounts' interest rate went up from 8.20% to 8.25%. A month later, it went up again and this time to 8.35%!

Yay!!!

Rent increase and worries

We had a visit from our landlord today for a quick inspection before we renewed our contract for the next 12 months. I was not totally surprised when she told me about the increase of rent to $15 more per week, but of course it was not a welcome expense given that I'm only on maternity subsidy in addition to J's salary.

I tend to worry about money when I think ahead. I want us to have our own home but would like to pay off all of our debts first. I can't help to think about the amount of rent we pay that could be part of a mortgage payment. Then again we don't have enough savings for a deposit either. We'd like to pay more than the minimum (5%) to get more equity and pay less interest. There's still the student loan that we need to tackle, but having a child is not cheap nowadays. I'm living it all each day and I don't want to quantify the expenses of child rearing in, say, 3 years. I feel bad as a mother and guilty of such thoughts.

In the last 2 weeks, we have dipped into overdraft again. We bounced back this week but it worries me that in less than 4 months we'll be paying daycare, which is another $800 a month, and that's the cheapest estimate I know. This must really be parenthood - worrying, budgeting, being poor :) I hereby welcome myself to it.

Despite all the worrying J and I are still checking out the property market online. We are keen about it cooling down. By middle of this year we will be checking how much we could be loaned for. All our 2008 goals - getting rid of debts as shown in the column on the right - are still realistic I believe. I hope to get a raise by middle of this year as well. Who knows, maybe I'll apply for that job that would allow me to work from home.

I just really want to vent right now.