Families Commissioner on how to beat debt

Frugal reader Jack reminded me about this story, which was front page news on today’s DomPost:

Families Commissioner Gregory Fortuin said the research, to be issued in full in September, indicated that household debt could be reduced by a fifth if three characteristics in the New Zealand psyche could be dealt with.

The main behaviours driving debt were the belief that life and financial management was out of your control; having aspirations based on comparisons with other people; and a tendency for impulsive buying.

The commission is now looking at what can be achieved by attending to those factors, which it identified last year.

The study also identified that a quarter of households were not keeping up with mortgage repayments and bills. More than one in five were selling possessions and turning to family for financial help, and a third were getting some form of community financial support.

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DEBT BUSTERS

– Regain control of your spending

– Don’t spend to keep up with others

– Don’t make impulse buys

On the one hand, the advice seems like common sense to me, but on the other, clearly it can’t be that common. And as we all know, these things are easy to say, but full of challenges if you want to practise them consistently.

Regaining control of your spending means that you have to start recording what you spend diligently, and using the results to construct a budget.

Not spending to keep up with others means developing a thick hide, learning to make the cheap look good, and resisting the pressures of your peers and a lot of clever marketing.

Avoiding impulse buys seems the simplest to me, but even then, there are days when it’s going to be difficult to get along without your wallet.

I think we might rustle up a post or several on these points in coming days.

Value for money in shoes

One of the reasons I have this blog, apart from enjoying hectoring you about my economic moral superiority, is that in making a pretence of being a sensible person online, I feel some pressure to live up to my own hype. So I’m wandering around town peering in windows*, feeling like spending some money, and then I think: Stephen, is that frugal? And then I don’t. See? The blog works, not for you, but for me.

For the last few weeks I’ve been thinking I need new shoes. My main pairs of black and brown shoes are both near wearing out. I am enough of a traditionalist that I believe I need a black pair and a brown pair in order to be a properly-dressed chap.

Unfortunately, both the pairs of shoes in question date from a time before I really cared much about frugality in the footwear department, and so neither pair can easily be resoled. Instead I’ve been pottering around shoe shops at lunchtime, marvelling at how much ugly and flimsy shoes cost.

Anyway, I finally bought some expensive shoes the other day. Really quite expensive indeed. Very sturdy, resolable, stylish rather than fashionable shoes, but expensive. Allowing for inflation, not as expensive as the Docs I bought in the 80s, but expensive. And the pleasure I felt in admiring my well-shod feet was somewhat mitigated by a sense that I had failed to be frugal.

Part of this sense stemmed from some ignorance about a fundamental issue: how long should a pair of shoes last?

Luckily my friend Mary told me a simple rule of thumb which I think seems pretty sound: one dollar per wear. So $100 shoes that get worn twice a week should last out a year.

By that criterion, the old Hush Puppies I’m replacing were successful. They cost about $200 some years ago, and have easily been worn once a week since. The Campers, which I loved and found very comfortable, were not. Their soles are so soft that they’ve barely lasted two years, even though they cost more than $300. I’m afraid I won’t be buying another pair again.

Interestingly, the cheap as chips sneakers I got from the Warehouse also pass easily, especially since I abuse them for martial arts training. They cost $15 a pair, so they’re well on the credit side of the ledger. It’s like pure profit every time I wear them… I’m hoping to get 10 years out of these new shoes and feel the same way about them.

So yeah, anyway, what counts as good value in shoes to you?

*A more common-sensical person, and honestly I am that person most of the time, would not peer in shop windows in the first place. Most of the time. Except when I need shoes.

Going large to save cash – Bulk Buy Bonaza

It occurred to me today that the world has moved on sufficiently if I can buy 5kg of flour and not have to worry about it being infested with weevils.

For starters I’d wonder how in the heck the little blighters got into the apartment, and second we’ll likely keep most of it in a plastic container.

The only real hassle will be using it quickly enough.

However, as long as we do use it all then the savings on this bag of flour are pretty good. This 5kg cost me $7, when a 1.5kg bag from the same place, Moore Wilsons, would have $3.88. So we save roughly $5 buying in bulk.

As I say, this is only an actual saving if you’re going to use the product in good order. But, with this winter being as damn cold as it is, baking seems to be the best way to get decent warm food in us while also heating the place up!

I’m planning three primary dishes for this flour. Mini muffins, scones, and, if I can get the yeast to rise, Bread.

Containers — who needs them?

There was a time when I felt we really ought to containerise things in the pantry. But we never did get enough containers.

And now I’m glad we didn’t. Here is what we do instead.

Kathy’s mother gave us a bag of bag sealers she had bought from a door-to-door salesman. They are so handy that every one is in use, and I bought some more. You can get a dozen or so for about $3 from Plastic Box.

A couple of years ago I bought 60ft of twist tie. We still haven’t finished it (after all, a length of twist tie is re-usable). I don’t know how long it’s going to last, but I do know it’s doing good work on bags of pasta and legumes and rice and in the freezer.

We have a fine collection of jars — too many in fact. And I used to scoff at Kathy’s propensity to wash and save plastic food containers from ice cream, hummus, cream cheese and what have you, but they turn out to be just the right size for leftovers and lunch boxes.

I feel pretty good about this. I admit it’s a bit ugly, but we’re avoiding using some resources and reusing others. When things stay in the bag, you can see what they are and check the expiry date easily. And there’s nothing to be sad about when a plastic tub or a jar cracks or breaks. It cost nothing after all.

Squeezing out every last cent

One of the downsides of handy modern packaging is that it’s sometimes hard to get out that last little bit of something.

And this is an example. This hand sanitiser, in short supply currently because of people worried about swine flu, is no useless. This is because the level of the gel contained in there has dropped below the level of the tube that sucks it up into the dispenser. As a result, we’re out money because we can’t squeeze out those last few drops.

Now, some people would throw this away now because it is, after all, only a little amount of gel. Other more sensible people will unscrew the cap, and wait a minute or so for the gel to drop all the way to the cap end, and then use the remainder. But, that’s at least a dozen or more uses of that gel in there, and unscrewing the cap and waiting for it to trickle down involves an interminable wait when you have an infant on the changing table giving you hell about, well, anything.

So what to do?

Well, we’ve put the boffins here at Frugal Me onto this one, and we think we may well have an answer.

1. tip the now-useless dispenser bottle of gel upside down until all the gel runs to the cap end.
2. unscrew the top carefully, so as not to get gel all over yourself, and tip the remaining gel into the new bottle of gel you bought to replace the old one.
3. relax in the knowledge that you probably saved 50c, while also not telling those manufacturers get the better of you.

Awesome.

Op-shopping

Since I’m on holiday with the offspring at the moment, Hannah and I spent a couple of hours pootling around op-shops today.

We both scored well — she got a very nice old cashmere jacket, and I got a warm wool blazer and some very classy trousers. Total cost $30.

Seems to me that if you can find clothes you like at all, the economics very strongly favour op-shops. New, stylish clothes of the cheaper sort rarely last more than a year or two before they wear out or look obviously old. Paying a much smaller price for things that will wear just as long seems smart.

Spending money on what gives you jollies

An important part of the philosophy we have been trying to promote here is that spending money is not bad in itself; rather, spending money on things that don’t give you jollies is bad, if you could be using that money on things that do give you jollies. True, this could be rather broadly defined — not having a penniless and starving old age sort of gives me jollies, but not in the same way as some really classy coffee beans, or seeing a good show — but in principle anyway we are trying to encourage applying your resources where it counts for you, whatever that means.

So I was intrigued by a New York Times article on people’s spending preferences and satisfaction.

I cannot help but feel that we are getting a view into the psyche of the New York Times reader rather than a universal guide to human happiness here, but it’s still interesting.

…we were struck by how much overlap there was between the most-expensive list and the most-happy list. People repeatedly included on both lists their homes, their college education, their vacation trips, their high-priced electronics (large-screen televisions, Blu-Ray player, audio equipment, computers) and certain models of cars (BMW 325, Audi A4, Jaguar, Subaru WRX, Toyota Prius, Honda Civic).

Personally, looking back, I would say:

Expensive but jollies-producing: musical instruments, foreign travel, books, my espresso machine and grinder.

Expensive and a big waste: rollerblades and other speculative forays into hobbies that didn’t take; the cake mixer and certain other marginal kitchen appliances; ill-advised “investments”.

Cheap and jollies-producing: musical engagements, large and small. Cooking nice food from crap ingredients. Class fees for capoeira.

Of all the material goods I own, I’d have to say that right now, my Ortlieb pannier bags are giving me the most jollies from sheer joy of possession, never mind their utility. I feel a bit stink about being so attached to such mundane objects, but I cannot help it.

Bulk buy frugality, coffee edition

As some of you know I roast my own coffee at home. I was turned on to this idea by my friend and former colleague Steve, who has been doing it for quite a while now. I don’t actually do it for frugality reasons — it’s more of a hobby — but since I am unwilling to give up the coffee habit, it’s very clearly the cheapest way to indulge it.

Yesterday Steve and I and a bunch of other people carefully divvied up about 100kg of green beans. Steve had cut a deal with a wholesaler and organised it all. Together we bought one 60kg sack and several 10kg bags. The average cost per kilogram was $11. Even allowing for 20% weight loss after roasting, that’s a very substantial saving for roasting it yourself, and actually somewhat of a saving over normal retail for green beans. Another win for buying in bulk.