Get organised in 30 days, Day 16

The Importance of Financial Awareness

Last week we looked into getting our bills and paperwork in order so that we can deal with one of the biggest and most overwhelming areas for Australians today... Budgeting

Many of us live on credit cards, store cards and have debt to the eyeballs. My husband and I were no different, just a few short years ago. We were renting, had 2 credit cards a personal loan, contracts that were costing us money, a housing authority Bond debt and were relying on hand me downs for our kids. When we moved into our last rental, we made a decision that would radically change our lives forever. We got Organised. Yes I started decluttering our personal belongings and paperwork, but we made tough decisions to get rid of debt and become financially responsible. We started with our smallest debt in size, but biggest in interest. I have since learned that the method I used is called "snowballing". As we paid off each debt, the money that was left over went onto the next debt on our list of financial clutter. Within 18 months we had got rid of 2 credit cards, reduced our telecommunications bill by $80 per month, paid 80 % of our Bond Debt and found out that were were able to purchase our first home by refinancing our personal loan. Even when we refinanced, we continued to pay it off at the same amount that we had been in the past. Within 36 months we had got organised, changed jobs, become financially aware and bought our own home. How did we do it? We learned to Budget. We were tough on ourselves in the first 6 months and we really shopped around for the best deals on everything before we did anything.

Today, we are over $4000 ahead in our Mortgage (in just over 2 years) and we are also ahead on our personal loan. We are driving 10 year cars that really need replacing, but we know that as long as they are still working we can manage. It is so important to change our mindsets from I got to have the latest and greatest NOW, to I can make do with what I have and work toward the thing that I want.

Having an organised office is so important in this process. You need to be able to put your hands on paperwork and bills, whenever they are needed. For me, paperwork is still my one area that I struggle with. I really need 2 rooms for what I do in my office at present (I sew, blog and run the family accounts), but I will work with what I have until we can make changes.

Time to count the cost

Today is office day, so I challenge you to get your office in order today. Have an area where you can keep all your office supplies handy: stapler, pens pencils, paper, envelopes, files etc. Have large envelopes to contain your tax returns and receipts, so that you can keep them stored for 5 years safely incase you get audited. It is also handy to have them when applying for finance.

When you have your office together and you know where to find everything, it is important to decide  how you are going to manage you budget. I have found a couple of free ways and a couple that will cost a small amount. Please keep in mind that I am doing this as a service and that I am not a paid financial advisor. I am also not being paid by any company for the links.

You can go old fashion pen to paper or computerised. I have tried both, and as I am a visual person I find the computer style works best for me.

Ok Freebies

Paper  monthly budget by Organizher 

Microsoft Money Sunset. I love this program. I have used Money for many years and was unhappy to see them remove it from the range. They came to the party with this last version as a freebie.

Paid Versions

Quickbooks Personal. At $99.00 it seems a little steep, but the program is stable and easy to use.

In the Apple Mac app store there is Home Budget. it is the closest I have found to Money, since changing over to a Mac.

The Organised Housewife also has an Excel based Budget. I suggest that if you use a Mac, not to get this program, as it is difficult to use in Mac based Excel programs.

At the end of the day, check them all out, they all have their own merits. I have used them all. 

Remember when budgeting to put some into savings. Even if it is just $5.00 per pay period. It will get you into a regular routine. I also recommend when budgeting, that you get out all the bills for the last 12 months and add them all up and divide by the number of pay periods in a year. Then add 10% to the figure. This will help you ensure that you can pay bills on time and even help cover the unexpected Shocker. Spreading the payments out over pay periods makes for less bill stress and a greater sense of knowing what you can play with.

Remember also to give yourself a little to have fun with. My Hubby and I get $20 each a week. Just enough to treat ourselves to lunch or that piece of fabric I have been eying off LOL.

Ok enough rambling! Go into your office and conquer your financial clutter!! 

Have fun and God Bless

Rivkah