It’s all about getting the biggest bang for your buck

How’re is your February going?  Are you coping with the bad weather, the never-ending Lockdown and the inevitable tightening of belts?  I’ve always found February to be a tougher month, financially, than January.  In January, you run out of cash early because you were paid before Christmas and end up in debt/overdue on payments; February is when those debts have to be paid back.   (You may remember me mentioning that tough February 30 years ago, when Dumbo left me with little more £20 to get through the month. It was the inspiration for several years of the “£50 February Challenge”.)

We  went to the Butchers’ yesterday, spending £55.70 from the Meat Fund.  Since our meat shopping is all about getting the biggest bang for our buck, I thought I’d share what we bought, what the plans are for it and how many portions we’ll get.  The butcher doesn’t do an itemised bill, so I’m only recording prices where I saw them and can remember them.  Remember, there’s only two of us in this household.

• 1 large roasting chicken - £7.99 - dinner tonight (we’ll eat the legs), chicken fajitas on Tuesday and chicken risotto on Wednesday.  That’s at least 10 portions, plus stock.  
• 1kg minced beef - at least 16 portions when padded out with veg, lentils/beans, etc
• 1 rolled, stuffed, boned breast of lamb 1.2kg - £13.60 - minimum of 4 portions of roast lamb.  The butcher cut it in half for us, so we have two roasts.
• 8 chicken breasts, average weight 200g each - between 16 to 32 portions, depending on whether I double up in a recipe.   I usually only use one in a stir fry or chicken pasta dish that serves 4.
• 8 large chicken thighs - 8 portions of chicken tray bake.  
• 4 pork chops - two will definitely be served as chops, while the other two may get chopped up to make pork-and-beans and a stir-fry.  Either 4 or 10 portions, depending on the outcome.

That’s between 54 and 80 portions of meat-based meals.  As I said, it’s all about getting the biggest bang for our meat-buck.

With the exception of tonight’s roasting chicken, I have just finished shoehorning it all into the freezer.  Everything has been “bagged and tagged”.  I had to do it in stages to maximise space/freeze things in shapes that will stack and fit together, especially since the freezer was pretty full already with lunchboxes, tubs of soup/cooked pulses/homemade ready meals and sauces, not to mention the haggis that threatens to leap out at you... The mince was divided into 4 and carefully stuffed into freezer box to form 4 rectangles.  The chicken breasts and chops were bagged separately and frozen to be as flat as possible.  The chicken thighs were bagged in fours, while the lamb was stood on its end, to freeze upright.  

As you can see, once again, I win at freezer Tetris.

- Pam

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On with the Motley

Today is a special anniversary.  20 years ago, today, I joined the discussion boards of The Motley Fool.  The Fool has played quite a big part in making me who I am today: tech savvy; an investor; a knitter again (I’d given up in the ‘90’s).  I’ve made friends through it; discovered new places; learned how other people live and how other countries operate (tax, politics, etc).  The members of the Fool taught me to budget and how to put the “living” into Living Below Your Means (aka LBYM).  Their posts gave me a window into their lives, before Blogs became a thing and long before Facebook.  For all of that, I say “thank you”.  Yes, I am a Fool and so are they.

All of the above brings me to what I want to say today.  I think that we’re witnessing the start of the next Great Depression and we will need the wise counsel of the Fools more than ever.  No, it’s not because the stock market has crashed (the FTSE100 is down over 2,000 points).   It will be the unintentional consequence of The Big Shutdown that we’re experiencing in Europe:  everyone working from home who can;  flights cancelled;  schools closed;  hotels, pubs, clubs and restaurants shut;  shops closing their doors and hoping that their online business will keep them afloat.  All concerts and live performances have been cancelled.  So many lives are already disrupted and it will just get worse.  The British Government has stepped up for regular employees - if you are furloughed, you will get 80% of your regular salary*, paid for by a government grant - but if you are a zero hours employee or self-employed, as I write you are only entitled to the most basic of benefits (£92/week).

In all this, my thoughts turn to what we can do to help. I worry about how bad it will get and how many people will suffer.  I’ve already fundraised for the local soup kitchen and the food bank**, but I want to do more.   Since I am a Fool and a cook, I have decided that I will create a collection of recipes of really cheap meals, based on four principles:-

1. Tasty
2. Filling
3. Nutritious
4. Less than £2 for an entire meal

They will be posted here on the Blog, since it’s free to access, and possibly compiled into a PDF.  That will be my big task for 2020. 

- Pam

* There is an upper limit in the £2,500/month.

** How is it that, in the 21st century, people are relying on soup kitchens and food banks, institutions which disappeared during the majority of the 20th century.

Goals for 2020

A very clever person on MSE has devised a “20 in 2020 Challenge.  I’m joining in and have set the following goals for 2020:-

1. Knit 20 balls of yarn (that's between 3 & 5 jumpers worth)
2. 20 minutes a day learning French (via Duolingo and TinyCards)
3. 20 minutes exercise a day for 20 weeks
4. Read 20 books
5. Try 20 new dinner recipes
6. 20 gardening sessions
7. Explore 20 new places
8. Attend 20 "shows" (concerts/plays/films/BBC recordings)
9. Do the 2020 Fashion On The Ration Challenge and keep within the coupon count
10. Phone family/friends to chat 20 times (I'm hopeless on the phone)
11. Lose 20lbs
12. Mend 20 items of clothing (yes, that includes sewing on buttons and taking up hems)
13. Declutter 20 items
14. Run 20 miles (but not all at once)
15. Save 20 x £20 out of my “allowance”(£400)
16. Make 20 site visits for work, earning mileage 20 times (it goes to the car fund)
17. Write 20 blog posts (in 2019, I haven't managed one yet)
18. Log 10,000 steps on my Fitbit on 20 or more days (harder to do than it sounds)
19. Have a party in the summer and invite at least 20 friends
20. Watch at least 20 programs that have been on the DVR since 2018

And a special goal, number 21:  Post on TMF 20 times in 2020.  I owe that website a hell of a lot and I’d like to keep it alive.

Care to join me?

- Pam

I'm a contractor - get me out of here

It's two months since I started my new job.  On the plus side:  it's closer to home so my mileage/fuel consumption is considerably less, they're paying me a reasonable rate, the job is (finally) keeping me busy and they are really nice people.  It's also very obvious that the Big-Boss-In-Charge-Of-Everything is not an absolute bastard.  There is considerably less stress floating around than in my previous company.  No stress puppies here.

On the downside, I'm a contractor.  I have no job security and I don't really have a role.  I'm picking up the pieces of things that others in the team haven't had time to do.  It took weeks for me to get busy and I don't know how long it will last.  I have also been battling a series of almost-colds - mainly sore throats - for the last six weeks, which makes me paranoid about getting something more serious because the job could evaporate if I got really ill.  (Yes, I have had this year's flu jab.).  At least my company now has money in it.

Yes, I now own a company.  In the UK, you have to contract through a company - either your own or an employment agency's.  It's the law.  Setting up a company is easy and cheap. The Companies House website will guide you through the process and charge you £12 for the privilege.  (We used to charge £200 for a company when I was in practice.)  Registering the company for corporation tax can be done at the same time.  Even registering the company for payroll taxes is a piece of cake (although I'm still waiting - a month later - for the payment docs so that I can actually pay said taxes).  HMRC even offer free payroll software that reports your numbers automatically to them.  

Setting up a company bank account, on the other hand was a a palaver that I would never want to relive.  It took over a month.  And that was to open an account at a bank with which I have had a 25 year relationship.  (I even own their shares!)   In the old days, you'd rock up to the bank with your company's Certificate of Registration, some ID, have an interview with the manager and that'd be it.  These days, everything is handled  online and by a call centre.  Nowhere on the paperwork is anything that asks you about your prior relationship with the bank; as a result, I had to prove my identity and my residency status twice.  To do that, I had to go into a branch and get them to photocopy my docs before they send them off via their internal post - a process that surprised at least one branch employee.  Why the hell they couldn't just do the vetting and the forms in the first place is beyond me.  It would have saved so much time and effort.

I finally got the bank account set up in time to pay myself my first salary at the end of October, and I'll pay myself again next week.  The payroll docs situation is equally frustrating, because I'm currently relying on guesstimating how much my take home pay should be, with a bit of help from the folks at https://listentotaxman.com .  Included in my calculations is an employee contribution to a pension fund* that equals what I paid in my old job and I'd like to bring that up to £1,000 a month, with the employer's contributions, but until I can run a draft payroll and test everything, I won't know for certain whether that is too much.  As well has having enough left over to actually pay the Taxman, I have to leave sufficient cash in the company to pay myself holiday pay and sick leave (if necessary).  And, of course, keep paying me after the job ends. Yes,  I can't claim unemployment benefits if the job ends, because I'm still an employee of my company.  (Grrr..... I can only go "on the dole" if the company winds up.).

The other reason I'm undecided about whether I like being a contractor is IR35.  IR35 is the Inland Revenue regulation governing "personal service companies" like mine.  The basic principle behind it is that directors of these companies are effectively employees of the companies with which they have a contract so, therefore, they should pay payroll taxes to the same level as if they were directly employed, instead of paying out their earnings via dividends at much lower taxes.  This is my first close contact with IR35 -  it was implemented in the year 2000, so post-dates my time working in the contractor unit at SL.  (Twenty years ago,  I spent a year doing the VAT and accounts for 300-odd computer and engineering contractors.  This was my first job as a trainee accountant.).   I think the rules are quite straightforward but, we'll see if I get tripped up.

In the meantime, I must be the only person in the country who is looking forward to a letter from the Taxman.  Come on HMRC.

- Pam








* UK equivalent of an American 401K or Australian Superannuation.

Tales of the Unemployed

If we aren't connected on Facebook then, chances are, you won't have heard my latest news.  My job finished on 5th August.  I was "restructured" out of the company.  It wasn't my choice;  I wasn't given much notice; and the business I looked after didn't have any say in the matter.  In fact, I had to break the news to their senior management.  (Being Finance, the line management that determines your fate and the people for whom you are actually working are frequently totally disconnected.)

Dark, God bless him, came down from Manchester to ensure I wasn't alone on my last day, took me out to lunch and made sure my sense of self didn't feel too battered. He is the most wonderful friend.  With his unerring sense of timing, he'd phoned me just after I'd got home on the day my boss broke the news to me and I cried all over him.  

It was the end of a brutal couple of weeks.  Definitely, the hardest part about leaving was saying goodbye to people.    Because I'm me (and conscientious), I wrote handover notes for whomever will pick up the work afterwards, and I made sure my business boss (Our Man in the Middle East) has copies.  I handed over my projects to someone I can trust to look after them properly.  I couldn't just walk out the door, leaving people who depended on me in the lurch.  (My line manager, on the other hand....)

Since then, I've spent the last two weeks licking my wounds and trying to figure out a way forward.  I have never not worked.  The plan of attack has been:-

1.  Update my CV, which I hadn't done since 2011.  It's been drafted and redrafted, and then summarised.  (The latter was the hardest part, so I enlisting the help of a friend who writes CV's for the National Careers' Service. Thanks Eva.)  
2. Updated LinkedIn.  At some point over the last few years, they deleted the job details I'd laboriously put up in ?2012, leaving only the headline job titles.
3. Signed on with the DWP/Job Centre.  No, I don't need the derisory £73 per week they'll be paying me as contribution based Job Seeker's Allowance but this was a point of principle.  I've paid into the system for 27 years, I'm entitled to the money.  Also, I want the NI "stamps" that come with it, which will go towards my state pension.  (I will probably rant about this in another post, later.)
4. Contacting agencies.  I have contacts at several so have been gradually dropping them all emails.   Two are putting me forward for jobs as I type;  a third, I shall see next week. I spent Friday morning meeting with three recruiters at the one agency, who were really positive about the job market for accountants in the Thames Valley.
5. Working out how to eek out my payoff.  I've got savings and a reasonable payoff coming to me a the end of the month, but my "hope for the best, plan for the worst" conscience tells me it could take considerably longer than I expect to find a new job that will pay me what I think I'm worth.  I've shut down everything I can think of:  the ISA savings; the share investments; the money being set aside for holidays; Audible subscription, etc.   The only things I'm committed to contributing to are the joint account for the mortgage/household bills and the housekeeping.  I reckon I can eek the payoff out to last a year without having to sell off any shares or raid my existing savings.
6. Working out what do with the money.   Beyond picking a savings account into which to shove it all for now, this is still at the daydream stage.  Each month, I'll transfer back the minimum I need to pay my share of the household expenses.  As to whatever is left after I get a new job, well, at the moment, I'm tempted to put it all into an FTSE100 tracker.
7. Spending my profits from the Employee Share Save Scheme.  Under the rules of the scheme, I had to either sell or transfer my shares from the scheme manager when I left the company. I'm currently sitting on a 44% profit so have decided to sell.  As agreed with DH, this profit will be my "mad" money, to spend without inhibition on whatever I fancy.  I'm thinking of spending it on a multi-fuel stove for the lounge, a new "fake Aga" for the kitchen (my beloved stove is 16 and showing its age), and getting my sewing machine serviced.  Probably not what he had in mind, when he suggested I have some mad money, but hey...
8. Figuring out what to do with my days.  This is actually quite hard.  I don't know how to be "a housewife".   I have never been unemployed.   I've been in continuous employment since 1992.   Even when I didn't have a job before then, I did agency nursing.  Without the Olympics or the European Football Championships to keep me entertained (as they did when I was stuck at home with my foot), day time television is mindblowingly boring.   I've started a daily To Do List, just so that I don't become completely zombified by TV and, instead, actually achieve some things.

- Pam

Thank you Hector

In case you've never seen him before, here is Hector the Tax Inspector, the image of HM Revenue and Customs. 



Although I think Hector has never uttered it, he is permanently associated in my mind with a catch-phrase from earlier tax-self-assessment ads, "Tax doesn't have to be taxing"...

So... Why am I introducing you to Hector?  This afternoon, I broke the procrastinator's habit of a lifetime and completed and submitted electronically my 2013/2014* tax return**, over six months before the due date (31 January 2015).  Thanks to several midnight dramas while I was in Australia at Christmas, Hector tellls me I'm due a refund, having paid too much tax in advance via my tax code***. 

What happened at Christmas?  You may remember that I rent out my flat (we didn't sell it when we bought this house 11 years ago).  Well, I don't think I ever told you about being 13,000 miles away and having to replace the boiler when it broke just before Christmas.  Nor do I think I told you about being woken up at 3am Australian time on Christmas Day (!) by a phone call from the tenant downstairs, when water was cascading through her bathroom ceiling four days after the new boiler was installed and frantically trying to get hold of the rental agents on Christmas Eve UK time.  (Thank God I had their mobile numbers.)

Anyway, I knew that the costs would have a knock on effect on this year's tax and had been eagerly collecting the relevant paperwork****.  For once, I wanted to get my tax returned filed as soon as possible.  This afternoon, with DH out of the house and the Wimbledon final on the telly, I sat down to do the necessary.... And got a pleasant surprise.  Just between you and I, it never occured to me that I might be due a refund for the last tax year - shocking, I know for an ex-tax professional - but because I pay estimated-in-advance-tax on my rental income via my tax code, I was hoping it would increase for this year and, with it, my monthly take-home pay*****.

The question now is what to do with the refund.  While, it's not an earth-shattering amount - several hundred Pounds not several thousand - I don't want to fritter it away.  Since I spent a large proportion of my "F-You Boss" money on rebuilding the kitchen, I think I'll put the refund into my cash ISA to boost that up.

- Pam


* The British tax year runs April to March.

** Not everyone in the UK has to file a tax return.  If you're a basic rate tax payer and only have employment income, chances are you will never have to file one. You'll pay all your tax via the PAYE system (pay-as-you-earn).

*** Every UK employee has a tax code, which tells their employer how much of their salary should be tax free.  For most people, it is their tax-free personal allowance (currently £10,000 per annum), but if you fill out a tax return, you can elect to pay any tax owed via your tax code.  Additionally, since our tax system requires payments-on-account if you've got rental income or self-employment income above a certain level, if  you're also an employee then you can opt to pay that via your tax code, which is what I do.

**** My P60 arrived promptly in April, but my P11D (benefits in kind statement) seemed to take forever and only arrived on Wednesday.  (The deadline for issuing them to employees was today.)    A P60 is the equivalent of an Australian "Group Certificate" or an American W2.

***** I am still expecting that to happen, but only by £10-£20/month because the 2014/2015 tax year estimate will be based on this latest tax return.

Nickle and Dime-ing it

 (How annoying - I wrote this post and then lost it.)

Have I ever mentioned to you our coin collections?  How, every day or two, DH and I empty our wallets of 1p, 2p, 5p and £2 coins and pop those coins into various jars and a money box.  The coppers (1p and 2p) go into one Celebrations sweet jar; the 5p pieces into another; while the £2 coins, aka the "Running Away Fund" goes into a Maltesers phone booth money box.

 The coppers jar holds about £22 and takes a year or two to fill.  Ditto the Running Away Fund, which holds £600.  In the thirteen years since we started filling it, 5p jar has never been emptied.  The above photo is at least three years old and, even though we have been adding to the jar assiduously since then, it took forever to fill.

A couple of weekends ago, the jar was finally full.  And heavy (once they were bagged and tagged, I weighed the coins: 10.2kg).  It took the two of us over an hour to count them all.  5p coins are small, about the size of a dime, and the instructions from the bank was to put £5 in each bag - i.e. 100 coins.  We filled 32 bags.   DH lugged them into the bank on the Monday and added them to our Running Away Fund (holiday money) savings account.

Thirteen years of saving 5p pieces netted £160.

- Pam

In which the Toy gets a new "pacemaker"

The Toy has had starter motor problems since the summer. When I got him serviced in September, I told the mechanic that he was getting slow to start and was advised to wait until it got really bad, once winter started, and then get a new starter motor fitted: "No point doing it now. Might not get worse for months. Might as well save your money until then." (This is a local garage not a dealership.) Last Monday morning, I switched on the engine and all Toy could manage was a single, asthmatic wheeze. Waited a few seconds and tried again: the coil light for the glow plugs came on followed by a bit more wheezing. On the third attempt, he started. (Toy is a diesel. Once the fuel is warm enough to ignite, he'll run forever. I bought him new, 12 years and 263,000 miles ago.)

I drove into work, phoned the garage and booked him in for his new starter motor, which was done on Wednesday. He also got two new tyres (they needed replacing) and a set of new wipers (the old ones squeaked even in the past week's heavy downpours). The last time he had his starter motor replaced, 6 years ago, was back when I regularly him to a dealership for servicing and repairs so I was expecting a bill for at least £600 plus the cost of the tyres (say £750 in total). I was pleasantly surprised when I got the bill - £287.17 for everything, including VAT.   My bank balance was much relieved.

Oh, and guess who now eager to get going on these dark wintery mornings and starts first pop?   Makes me wonder exactly how long the starter motor had been going.  

- Pam

Dear BBC

Thank you for all those years when you broadcast the Grand National live on TV. Today was the last one and your coverage was better than ever. (I am not saying that just because I had 50p each way on the winner, either.) You will be missed.

To the Powers That Be: I, for one, would happily pay an extra £20/year on my TV Licence to enable the BBC to continue broadcasting top sporting events. Even if you increased the licence fee to £20/month to pay for more sport and drama, it would still be good value (currently £12.12/month). Personally, I think the BBC is worth every penny of £20/month. Stop trying to cripple it.

- Pam

Frugal Friday - Temptations and Balancing Acts

I am having one of those days, when I want something "just because" and part of me is rationalising hard to get it.  The thing is, it might turn out to be pretty ordinary when I finally get my hands on it.  But I won't know that until I handle it.  All I've seen are pictures and the colours are lovely...

Naturally, I'm talking about yarn.   I subscribe to the Lidl newsletter, which lands in my in-box on Mondays and Thursdays.  Every so often, they do knitting yarns and the odds are 70:30 in favour of their yarns being good instead of cheap, nasty acrylics.  Yesterday's edition announced that, as of Monday, they'll be stocking a cotton-wool-blend sock yarn (this one with a new name), some 100% DK cotton in assorted packs (meh), and a cotton-viscose blend DK which really caught my attention (this one, I think).  The colours I'm lusting after are the two at the back, the pretty pink and the aqua:

 (Photo from Lidl's website.)

They'll be sold in packs of 4 skeins for £4.99 a pack.  Two packs of either would be enough to make a Soleil from Knitty; three would make a Raina from the Twist Collective.  And here is where my argument with myself really starts:

On the one hand, the price is totally within my self-imposed £3/ball limit.

On the other hand, purchasing enough to make the Raina would absorb a quarter of my £60 yarn budget for the year and we're only one month in; buying both colours would have me spend £25 or even £30 on something I might not knit with for 2 or 3 years.  That's 40% or 50% of the budget.  Can I really go 11 more months on £30?  Money will be tight until DH gets a new job and I don't want to set myself up so that I'll break the budget later on.  Also, if I spend this much now, what will I do if something better comes along later?

On the first hand, I'd like to encourage Lidl to keep stocking yarn, and the only way to do that is to buy some.

On the second hand, I have two separate yarns in virtually the same shade as the pink (if the photo is true to life).  I don't need more.

On the first hand, I don't have anything like that aqua.  I could settle for just the one colour.  And while Soleil is nice, the Raina will be more flattering (especially if I modify the neck to a sweetheart one like this one in Ravelry).  Or I could do the Soleil - that'd mean only spending £10.

On the other hand, I have far too much yarn as it is.  I DON'T NEED MORE YARN.

God, I hope the stuff looks horrible in real life!  That'd save me from trying to square the circle.  Knowing I only have £xx to spend means that I want to get the best value possible and not squander it.  I have to balance the "I want it now" with the "but will I want that more, later?".   That is what budgeting is all about.  It's a way of ensuring that sufficient money accumulated now for goodies later. 

- Pam

Frugal Friday - the "M" word

M is for money. 

It seems that, every where I looked before Christmas, people were talking about budgets and budgeting.  The BBC ran a series of the Money Programme looking at people and money. Channel 4 ran a Christmas Special episode of Superscrimpers as well as The Ultimate Guide to Pennypinching.  We recorded most of the episodes and have caught up over the last week.

The BBC Money Programme series started with an episode about people paying hundreds/thousands of pounds to attend wealth seminars, in the blind hope that they'll discover some big "secret" that'll make them rich overnight without putting in some hard graft first.  The people profiled missed the big irony - that the real secret behind wealth seminars is in the income they generate for the organisers a.k.a. "wealth counsellors" and not in the information they're presenting to their audience.  (That is a rant for another day.)

What was more interesting to me were the second and third episodes:  the second episode was about couples and the conflicts money (or lack of it) causes;  the third profiled several families where their combined, after-tax  income was £40,000.  In each, the couples talked about their budgets and their attitudes to money.  The couples episode, in particular, included questions about whether they ever talked about money to each other, how they rated the other person's attitude to money, etc.

Some really stuck in the memory.  For example, I don't rate the longevity of the marriage of the legal secretary who despised her NHS-employed, research scientist husband's income for being too low at approximately £31k.    He has a PhD and is working on potentially life-saving research but science doesn't pay in this country (frankly, if he was married to me, I'd be really proud of him for the work that he does and not care about his salary).  Her opinion, though, was that he is failing as a husband because he would not keep her and her children in the manner to which she'd liked to be accustomed.  According to her, he was "tight" with money.  It was obvious that she compared him to the lawyers for whom she worked, who earn a lot more than he does and who probably have stay at home wives, kids at private school, etc. They only married because she got pregnant within 6 weeks of their first date and didn't have a "money conversation" until long afterwards.

(Incidentally, the obvious money-earner has never seemed to occur to her:  studying law and persuading her employers to back her. Or as DH put it, "Stop moaning about your husband's income and work out a way to earn some more yourself".)

One of the eye-opening points of the show, of all these shows really, is that many couples never talk about money.  Oh, they grumble about each other's spending and how much things cost, but they never really talk about money.  Or about what they want it to do for them.  That is what a real money conversation should be all about:  goals.  It's about determining what you want out of life and how you will get there. It's also about working out how you will pay for it.  For a couple, it's about give-and-take, determining what is jointly a priority and what they'll sacrifice to get there.  It shouldn't be about one person giving all, while another take-take-takes.  Both partners need to pull their weight.

Really, that is what budgeting should be all about.  Sitting down with your partner and determining what you want out of life, what it's going to cost, how long it will take to get there and how much you'll need to set aside from each pay-cheque in order to pay for it in the long run.  Then when the priorities are settled, you need to work out together how you're going to have a good quality of life from the money that remains.  The aim is to have a champagne life-style on a beer budget without going into debt to support it, while setting money aside to work towards your goals.

- Pam

It pays to shop around

I should be fuming.

The Toy turns 11 next month.  With his insurance due for renewal, I went on line to compare quotes.  His current insurer is quoting me £50/month or a one off payment of £560 for fully comprehensive insurance including business cover - £20/month more than I was paying the same company a year ago.  In fact, it's more than I was paying when he was brand new!

Lured by their advertising, I logged onto Comparethemeerkat.com comparethemarket.com and typed in my details. Everything exactly the same.  Half-way down the list of insurance quotes was my current insurer, quoting exactly half what they quoted to me.  So I phoned my insurer.  "Sorry, madam, we can't match that quote....You're an existing customer and that makes you ineligible."

Huh?  So you don't want to keep my business then?   Good-bye.

Frustrated, I turned back to the quotes on the internet.  Directly above my current insurer and £2 cheaper was a subsidiary of the same company.  Five minutes later, I've bought identical car insurance through them.  And scored a free Meerkat toy, with my own Meerkova Village Parade.  Enjoy!



- Pam

Tightening My Belt

For most of my working life, the last working day of the month has been Pay Day.  This morning, as usual, I did my accounts.  Using the cash book pages in my Filofax, I listed my income and my outgoings.  While I do this every month, today I had a bigger incentive - having watched the numbers closely in June and July, I made the decision in August to save and invest more money.  And now, I wanted to see what the effect would be on my bank account.  (Yes, that's right, while I can run scenarios in Excel until the cows come home for work, I never seem to get around to doing it for myself.  Wishful thinking numbers, yes [e.g. daydream scenarios of lottery wins].  Real numbers, no.)

So, this morning, I added my salary payment to the balance in my bank account, deducted money for the joint account, my savings accounts, Weight Watchers, Audible, the Housekeeping money, my share ISA, £180 to the Petrol/Diesel Accrual, and £180 to my Money to Live Off.  I went to write down the next line:, "credit card repay", and stopped. Staring me in the face was a brutal truth:  I'd been too cocky with my calculations when I changed the savings and investment numbers.  No matter how many times I added up the numbers - and most of them are the same each month - there was no way I could avoid what I was seeing.  If I was to maintain my debt pay down levels something would have to give.  I had a shortfall of £35.

£35.  Not a huge some of money.  There have been times when I've spent that much on a meal out.  But it was £35 more than I earn.  £35 I don't have.

I stared at the numbers. I started arguing with myself. I baulked at cutting the debt pay-down money.  It made me nauseous to think about it.  I also rebelled at cutting my savings and investments.  Just couldn't do it - that money is needed for future things, important things, for which I have plans.  That left little else to choose from:  my Sanity Fund? No! Everyone needs a Sanity Fund and mine is only £60/month (earmarked for a pressure canner, clothes and craft supplies).  Cut out Weight Watchers?  No, even though I don't go to meetings any more, I need access to their website to track my points.

ARRRGGHHH!!!!!

In the end, I decided it'd have to be split equally between my Money To Live Off and the Petrol/Diesel Accrual, which is money I allocate to pay for fuel for the car during the month.  £17.50 off each.  It's not going to be easy.  I'd already cut my Money to Live Off back so that I could save more money.  Now it's £162.50 a month to pay for everything I might need and/or want:  birthday presents, social events, music for choir, hair cuts, clothes, software, books, DVDs, dental visits, etc, etc.  Seems like a lot of money until you realise that a round of four drinks at the pub quiz can cost over £12.

The effects on the Petrol/Diesel Accrual will be even harsher. At current prices, it's down to little more than 4 tanks-worth of diesel a month.  I usually go through one tank a week in a normal-commute-to-work-week.  As long as a tank of diesel stays below £40, then I should have a little time to save up for the next 5-week month.  That will be March; September won't qualify because we're taking a holiday and December includes work's Christmas shut down.

Fingers crossed I get a salary increase when the pay reviews are done in December.  I'd like my £35 spending money back, please.

- Pam

Talking about money - the Housekeeping

(Yay!  Blogger is working agan.  For a while there, I was worried that Google had completely screwed it up.)

Yesterday was the first Friday afternoon in months where I had the house to myself.  DH has started a full time job with regular hours, 9 to 6.  It's not in his field - it's in retail, whereas he's a design engineer who's always worked in manufacturing - and the pay is just above minimum wage, but knowing that he'll have regular money coming in and receive his statutory benefits (sick pay, holiday pay, etc) is a great relief.  It also means we can start looking forward instead of staying in fire-fighting mode.

As a result, last weekend, we spent an hour or so going over our finances.  One of the hot topics was what to do with our housekeeping kitty.  Until now, we've been drawing cash each month and stashing it in various pots:

Groceries:  £120 (farm shop, wine and all supermarket shopping)
Meat fund: £ 40 (includes fish from Costco.)
Christmas: £ 10 (also used for Easter Eggs)
Bulk fund:  £ 10  (for Costco visits, WingYip visits, special deals at the supermarket, etc)
Total        £180 (£90 each) 

The Meat, Christmas and Bulk funds are left to accumulate until there is a reason to spend them, whereas the Grocery kitty rarely has anything left at the end of the month.  If there are bargains to stock up on, we raid the Bulk Fund.  I've thought for a while that £10/month isn't suffiicent and that's one of the things we agreed about on Sunday, upping it by £5 each to £20/month. 

One of my permanent niggles is that we don't put money aside for the garden.  At the moment, either we pay for it individually and suck up the cost or then go through the drawn out process of getting it back from our joint savings account (an internet account that doesn't allow you to transfer money anywhere - you have to go to an ATM or request a cheque).   I don't know exactly how much we spent last year on the garden but it was under £100. 

One of DH's permanent niggles is that we have these "funds" sitting around in cash for months at a time, not earning interest.  It was also one of the reasons that he's previously vetoed a garden fund - he didn't like the idea of leaving that cash lying around for 9 months of the year. 

On Sunday, we reached a compromise:  we'd start a garden fund but it'd be saved in ING instead of in cash.  Ditto the bulk fund and ditto the Christmas fund.  The garden fund would be £10/month.  Bulk is to go up and Christmas is to remain the same as before.  In ING, they'll have their own accounts and it's easy to get reimbursed since we can transfer the money bank-to-bank.

So, our new housekeeping budget is as follows:-

Groceries:    £120
Meat Fund:   £ 40
Christmas:    £ 10
Garden         £ 10
Bulk fund:     £ 20
Total:          £200   or £100 each a month.

- Pam

Daydreams

Today had one of those frustrating afternoons.  I had a report to produce that I'd forgotten how to do, followed by the finance system going on a go slow.  By 6pm, it had ground to a complete holt, twice, but  I had an invoice to get out, so had to persist.  Lots of time spent waiting for the system to respond to even the simplest commands.   With my computer seizing up,  I daydreamed, wistfully deciding what I'd do if I won certain amounts of money in the lottery.

£100,000?  I'd clear our debts (say, £10,000), buy a new car (another £10,000), finish the house (£20,000), get the garden sorted out professionally (£2,000), fully fund an emergency fund (say £20,000), spend £10,000 on IVF, throw away a bit on gifts, travel and toys (say £8,000), and invest the leftovers in shares (£20,000).

With £500,000, I'd do all of the above, pay off the mortgage (£200,000) and split the remaining £200,000 into deposits for between 3 and 6 flats to have as rental properties.  (Each property would cost between £120,000 and £200,0000, with the balance coming from a mortgage.)  £500,000 would produce enough income that only one of us needs to work, so DH could retrain to become whatever he wanted.   And, having paid off the mortgage, we could invest each month's "mortgage money" in shares.

A win of £1 million, would mean we'd both be able to retire.   I'd do the above, and then spend another £300,000 on rental flats - maybe buying a couple outright for the income, as well as using some of the money to fund deposits for others.  The remaining £200,000 would go on shares.

If it was a £10 million win, we'd be able to do all of the above and give some sizeable cash gifts to family.  With £10 million, none of the properties would need mortgages, so would give us a sizeable income every month, to live off and reinvest.

I didn't get any further - a colleague interrupted my reverie and I didn't feel like sharing my thoughts with him.  Instead, I had to turn my mind back to work.

- Pam (if it was you, what would you do?)

Stitch & Craft Show, Olympia

Errr.... How do I put this?  "Forgive me Father for I have sinned...?"  No, I'm not Catholic.  How about "I've solved the dilemma about whether to buy a 16GB or a 32GB iPhone4.  It'll have to be the 16GB one because I've spent the rest of my money on yarn"?

Yes, I think that works.

Today, I took the day off work to go to the Stitch & Craft Show at Olympia, the little sister to the big Knit & Stitch Show held at Alexandra Palace every October.  This is the second or third time I've been to this particular show and I may not have gone if it wasn't that one of the magazines I subscribe to offered discounted tickets at £5.

I told myself:   it'll be a cheap day out.  I can take my lunch and some coffee and save my money for yarn.

I told myself:   no stash enhancement unless I find something amazing or an amazing bargain (and, preferably, aran/worsted weight).

I told myself:  I don't need any more yarn.   I'd just buy some tools, maybe some KnitPro/KnitPicks crochet hooks.

I told myself:  I'll set the budget at £30 and stick to that.


I lied.

I'd barely walked in the door when I encountered the Black Sheep Yarns booth.  (They were directly in front of the door.)  I've mentioned them before.  Every show, they bring along thousands of skeins of yarn, which they sell by the bag at half-price or less.  The owners dump all the sealed bags  into a big heap and the knitters just dive in.  It resembles a rugby scrum.  Would you believe me if I said I was sucked into the vortex and barely made it out of there alive, clinging to bags of yarn to escape?

No.  I didn't think you would.  

My haul from Black Sheep includes:

• 30 skeins of Sublime Cashmere Merino Silk Aran, in the coast colourway (light blue).  Sufficient yarn to make a sweater for DH.  (I've probably bought far too much but that was the quantity recommended by Carole from Black Sheep for a man his size.) I was thinking of making the Inishturk Sweater from Lionbrand for him.  If he doesn't like the yarn, I'll make it for me.   Total price:  £68.97.
• 20 skeins of an unknown brand pure-wool 4-ply, in a really pretty baby-pink.  Given their size, I assumed the skeins were 25 grams each - I've just weighed a bag and I was right. Knitting destination - something vintage. Total price:  £19.98.

At this point, I escaped Black Sheep and wandered around the show.  However, I had to pass them as I was leaving and the only way to get out of the vortex was to buy:-

• 10 skeins of Sublime Soya Cotton DK in shade 085, Noodle, bought to make the pattern, Souk, from the book shown, The Luxuriously Exotic Soya Cotton Hand Knit Book also by Sublime.  Cost including the book:  £23.98.

(I  really like the cover pattern, Passionflower, and the colour it's in (shade 088, pomegranate) which is why I returned to the yarn heap.  However, they didn't have any pomegranate and it does occur to me that it would work well in the Sublime Angora Merino in Giggle Pink, that I already have stashed.)

The other place I dropped money on yarn was the Lang booth, home of Addi Turbo knitting needles, and Jawoll sock yarn.

The Jawoll Magic is for a pair of socks for DH; the other two are self-patterning and we may fight for them.  Total cost:  £19.

So much for self control.  [sigh]

I did buy some tools: stitch holders and the like, spending £9.45 in the process, but not the KnitPro hooks - the available sets didn't appeal to me.

Anyway, I've just added up the cost of today's haul and I'm not proud of myself:  £141.38. 

Yes, I have the money in the bank to cover it.  Yes, I won't get into debt over it.  Yes, I will use it all... Eventually.  But I'm not pleased with myself for walking in the door at the show and diving straight into the Black Sheep yarn pile, going "Aran!  Aran!  Must have Aran!  What can I make with it now I've found it?".  (The light blue wasn't even a colour on my list - it was the only shade they had that appealed to me that both DH and I can wear.)

[sigh]

This was meant to be the year when the stash decreased NOT increased.  If I knit for an hour a day, every day, until Christmas, do you think it'll make a difference?  (Like I don't do that already?  [sigh])

- Pam





PS:  The show wasn't just about yarn.  One of the stands was manned by Corum, the charity that was originally the Foundling Hospital.    They were displaying some of the thousands of foundling tokens left with the children by their mothers (in an age of illiteracy and before fingerprints, the tokens were a means of identifying a child should the mother come back to claim them later).  Most of the tokens are cloth, sometimes embroidered, sometimes just a piece of ribbon onto which was written a name.  (Many mothers tried to name their babies even though they knew they'd be renamed once they were admitted.)  The token was attached to the child's record of admittance.  They form a valuable textile archive, which is why they are being displayed a this show.   Someone commented to me that they found it fascinating. "It's heartbreaking," I replied and started to cry.

Frugal Friday : How I Saved The Week

I had a "well D'uh!" moment this afternoon.  After I collected my new glasses (see below), I popped into the bank to deposit a cheque and ended up having a chat with one of their advisors.  In the middle of her trying to sell me one of their "new, improved" cheque accounts complete with shiny fees, we both had an epiphany.

Her rationale for "upgrading" my account to a shiny new one was that it because it has a much lower rate of overdraft interest, even with the fees it'd be cheaper.  They're currently charging nearly 20% p.a. on overdrafts for accounts like mine.  Plus they've imposed a monthly fixed fee of £5 for each month in which the account goes into overdraft.  And even with last year's good effort, I'm still overdrawn for much of the month. If I didn't want to do that, she suggested, what about taking on a bank loan and transferring my overdraft to that?  Or utilise a 0% credit card offer?    "I've got a 0% credit card offer.  I used it to pay for the freehold to my flat," says I.

"And why haven't you transfered your overdraft to that?" she demanded. 

At which point, I stared at her.  And the penny dropped.

Hard.  

I could do that. And I could continue paying down that debt and pay it off faster because I wouldn't be clobbered by interest and charges each month.  The effective interest rate is about 4% p.a. instead of 20% p.a., so why haven't I done it before?  (4% because that's the rate of the balance transfer fee.  I'm simplifying, of course.)  The 0% rate runs out in November - that should be enough time to clear the overdraft, while continuing to pay down the balance already on there for the freehold.

There are risks.  The biggest being that I could drift back into overdraft, ending up worse off than where I started:  heavily overdrawn but this time carrying a similar balance on a credit card.  Can I trust myself not to do that?  A year ago, I don't know, but now I think so.  I've paid a lot of debt off in the last year.  I track my spending.  I've put money into savings.  I've recovered from the drain on my finances of having an empty flat (better, the tenant has just signed a new 12-month lease with a rent increase of £25/month).  And my salary's gone up (I've had two raises). 

When I got home, I logged into the credit card website and made the transfer.  It does make sense.

- Pam



PS:  About the title, one of the podcasts I listen to is the Knitcents podcast.   Roue, the host, does a segment called "How I Saved The Week" where she lists her latest efforts to save money.  I've stolen it from her.

Sit-Rep 2010 - June & July

Apologies for the lateness of this Sit-Rep update.   It's not my fault!  In the last week of July, DH put a tank of diesel in the Toy for me and I've waited two weeks for him to tell me by how much I needed to reimburse him.  (Proof that nagging doesn't work - I must have asked a dozen times.)  Anyway, here is my update.  My last update is here.

STASH  Maintained cold sheep up until the day that I visited KnitNation on 31st July, when the lovely Sarah at Brownberry Yarns sold me 6 beautiful skeins of Artesano Alpaca Aran in a denim blue (photo to follow - I have a KnitNation Report to post).  I bought their last six skeins in that colour, right out from under the nose of another knitter.  At the time, I wanted 8 skeins because I'm a bit worried about the yardage (6 skeins = only 864 yards/790 metres), so I've ordered 2 more from Brownberry but couldn't get the same dye lot.

In other Stash/Kniting news, I've knitted another skein of Heathland Hebridean into the Brown Cable Cardigan (almost finished the second front).  I didn't mention, last time that I started the second skein of the Wagtail Mohair half way up the back of the Mohair cardigan, which is now almost complete - I've got less than half of one front to go, plus the edging.  Two skeins of Phildar Shoot went into a 5 Hour Baby Sweater for a colleague, which left me with 3/4 of a skein - that yarn was a charity shop find in 2009.  The leftover Cherry Tree Hill yarn from my sister's Zig-Zag socks went into a pair of fingerless mittens using the same zig-zag pattern.    And I've finished off another skein of sock yarn.  So that's 5.5 skeins for a total of 15.5 skeins.   Doesn't seem like a lot, given the amount of knitting involved.

GARDEN  Guess what my birthday present from was this year?  A terracotta strawberry planter filled with compost and three strawberry plants!  The plants are thriving and have given us a handful of strawberries (it is very late in the season).  One of them has already put out a runner, so we anchored it in a spare hole in the planter and now I have four plants.

On to the rest of the garden.  Didn't get a huge number of broad beans - while I was a dedicated squisher of blackfly, they won several battles.  The butternut squash is taking over the world, as are the tomatoes.  Most of the onions are doing well and the two broccolis which survived from last year have thrived (they were last year's failure-to-thrives that somehow survived being neglected in pots over the winter).   Some of the peppers and chillies are doing well but a couple of the jalapenos are just sitting there 3 inches high and sulking - in their case, I'm wondering if they were getting waterlogged in their grow-bags.  The rocket did well, then bolted and now is setting seed.    We've harvested two of the three potatoes and they were heavenly.

On the failure side:  I planted out some pak-choi and it died in the sun.  I doubt the garlic harvest will be that good but at least, now, I know what I've done wrong - garlic needs a freeze early on to prosper.  The courgettes failed to thrive, as did the runner beans; the plants didn't die; they just didn't grow any bigger.  I think watering may have been an issue, since June and July were both dry months and, although we watered every night, I don't think they got enough.  About 3 weeks ago, I invested in a soaker hose, which seems to be helping.

As well as buying and planting out my garlic before Christmas next time, the other thing I need to do is to get some fresh seeds.  The broad beans were grown from old seed, which may have been a factor in their not growing many beans.

FITNESS  Weight Watchers?  What's Weight Watchers?   Let's not go there, shall we?  I'm still attending Pilates and Yoga classes, but I need to add some aerobic exercise pronto.  At least I've located my new running shoes (bought at Christmas).

OVERDRAFT Paid back a combined total of £233.02 for June (£127.76) and July (£105.26) which gives a total pay back of £970.18 for the year.  Although I'm glad to see the balance is decreasing, I know is has slowed down a lot.  There are two main reasons for the slow down:  I've set a couple of new savings goals (next year, I will pay cash for my Chelsea season ticket for the first time ever); and I've increased the amount of money that goes into our joint account, in order to cover more of the shortfall from DH's unemployment.  I already know August will be a bad month for paying back the overdraft:  KnitNation fell into August's spending (it was after payday) and I've already run through my entire "Money To Live Off" budget.  The only hope for August is that I won't spend so much money on diesel for the car*, so the balance of the diesel accrual can be offset against the overrun.

SOCKS  As suspected, I didn't knit a complete pair of socks in June; instead, I did the Zig-Zag Fingerless Mittens and about half of one sock.  I finished those socks in July - they're my typical Use It Up Socks made from the leftovers of the self-patterning sock yarn and some Lisa Souza Sock! in ecru.  Hopefully, I can catch up in August.

- Pam (photos to follow)



* For my trips to Site, I habitually offset one tank of fuel against the money from my mileage claim since I use approximately one tank extra that week.  Since I'm going to site more often at the moment, it's possible I won't spend as much of my diesel accrual as I would in a more typical month.

And the answer is...

£64.  That's the net amount in my pocket of my pay rise each month.  Better than I thought, although not as good as it would have been if personal allowances weren't frozen this tax year (i.e. frozen at last year's level).

No, it's not going on yarn.  It's going to the joint account where it'll probably get spent on bills or builders.

- Pam (may spend a little bit on an Audible subscription, though)

Impatient!

It's two days to the end of the month and I'm impatient to get paid. This month's paypacket is the first after I was told I'd received a small raise and I want to see how much that translates to after tax and NI. I know it won't be much - somewhere around £60 extra a month in my pocket. But it'd be nice to know for sure - the perfectionist in me wants precision and my old rule of thumb, that each £500 translates to £25 net a month, has been complicated by changes to the NI rates and deductions for pension contributions, the employee share scheme and me buying an extra week's holiday (won't need to do that next year - at the rate I'm not using my vacation time, I'll have 2-3 weeks' leave to roll over in September). .


If the truth be told, I'm always impatient at this time of the month. It used to be a feast-famine reaction: Payday = Money to spend. (Yay!!! Just think of the possibilities! Oops, it's all gone!) Two days before Payday = No money left = Almost broke. (Booo! Must. Have. Cash. Now!) However, over the last few months, since I got serious about micro-managing my money, I've become impatient for Payday so that I can do my accounts and work out how much further my overdraft should decrease next month. I want the virtuous reward of watching that balance go down.

In theory, I could work out my tax position and take-home-pay position for the next year, but I'm too lazy. Instead, I'm impatiently checking our electronic payslip system every morning to see if the data's been posted yet. (Also, once it's there on the screen and in my bank account, I'll know the b*stards have followed through with their promise.) Only two days to go.

- Pam