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Wednesday, December 5, 2012

Financial Planning 101

I think I always irritate my hubby and mum ALOT when it comes to $. I am calculative, in the sense that I don't like to owe people, nor do I like people to think that I owe them. I know most people around me are not calculative nor scheming kind of course. But it's just a matter of principles.

$ is the roots of all evil. I ever fought with my sister a few times because of $. Once was because she brought me to the doctor which cost about $200 plus and she said she will pay for it. I wasn't at all working and she was already a working adult. THEN she one day nagged at me about it as if I owed her my life. In frustration and anger, I dug out all my coins and paid back to her. She is not a calculative person but I just hate the thoughts of owing her.

We currently owed our parents some renovation loan. And I am racking my brains over it. My parents are not calculative and my mum keep saying don't need to worry about it, don't stress my hubby. I know they don't need this money now but it's just frustrating to know that you have a loan to pay off. To us, the sooner you pay, the better you feel and the less interest you planned to incur. Also feel bad to hold on their funds for so long. I actually put aside some money to repay my dad for the university fees. But I asked him to write it off :p I am so evil! But surprisingly after six years of working, I have peanuts savings. Even when I have an excel spreadsheet to track my bills, I hardly had surplus. I am a big big waster. For instance, I have 25 hom yoga class (paid $461) all expired on 4 Dec and non-transferable and I couldn't get them extend until I give birth! I am so upset about not utilising them, wasted $ for it!

After a year plus of union, my hubby finally showed hand! I am so touched that he provided me with more information to help him handle his financials. I am so going to do a good job for him! So that he will feel richer and happier.

I am actually a bad planner as I hardly shopping or buy things but yet can't save much! But at least, it beats spending without knowing how much you can spend and thus overspent!

Basic financial planning 101:
- Nobody owes you a living, nor you owe anyone a living
- If you said you pay for it, do it. You have to make sacrifices of course, money don't just come like that.
- Plan plan plan! I plan at least two months ahead, knowing how much credit card bills I need to pay next mth.
- Pay yourself first. Deduct away all savings on the day you get your pay. After planning in advance, you will roughly know how much more you can save, perhaps put a float of less than $500 for your withdrawals.
- When you put aside your savings, don't take it out.
- Credit cards are evil. I really feel like cutting away all the cards, my card bills racked in thousands every month. I don't know why. Somehow, every month there is a big payment out.
- If you go by installment plans, just take the 12 month (max 24 mth) plan. 36 mth is pretty painful IMHO. It can chuck up a fair bit of money per month when you pay by installments.
- My friends used this method and most people do it but I don't, I just manage the float I had or my hubby will pay for certain things like dinner or spendings and sometimes I pay him back - Withdraw a fixed amount of money for your use for the month/week and spend within that.
- Another method I find it quite good - transfer all your remaining money to your saving accounts and have a fresh start before you get your pay! at least you make sure that you are spending on the pay itself, not surplus from prior month.

Theory is easy but putting it into practice is tough! I am very very interested to see how I can help to manage our finances as one household! Let's see!

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