Saturday, 21 April 2007

Wheres all the good posts gone?

Sorry for the lack of posts this week. I was called away to a conference for work and didn't have enough Internet time to keep up posting on the blog.

To make up for lack of posts, i have some great ideas planned out for this weekend.

Stay tuned


Monday, 16 April 2007

Progress Report Monday

Every Monday at the 6monthproject is Progress Report day.

Today was a positive day, for the first time since the blog started the progress bar has moved. We have saved 6% of our goal of $10,000

I made £310 ($614) in alternative income so far this month through tutoring and freelance. That money goes directly into my savings account.

In terms of budget, we're right on track. I drove a bit more than I've wanted. But I still have 1/2 tank of gas left, that should last until the end of the month.

Electricity is still our best performer on our budget. 18 days ago we put £10 ($20) on the electricity account. Today we have £2 ($4) left. That will last us 4-5 days. Our initial budget for electricity was £40 ($80) ! Needless to say we will be saving some money on this expense.

In 3 weeks I get paid. Income to savings target this month is £400 ($800).

The 96th Carnival of Personal Finance

AllFinancialMatters is hosting the 96th Carnival of Personal Finance. Go check it out.

This was 6monthproject's first carnival, and I'm happy to say we were listed! Here's to JLP for being a great host, and organizing the festival listings well.

Sunday, 15 April 2007

The ultimate in saving

Trent over at The Simple Dollar wrote a great article on the cost of childcare. It's a hefty article but well worth the read, especially if you have rugrats of your own.

But I want to focus on one area that caught my attention
I quit my job, she changes her job, and we move This is an option we’ve been looking at to target next spring. The advantage here is that we both have parents who live very near each other, but several hours away from us. My parents are both retired at this point and they would love to be free daycare for us a couple days a week. So, our plan here would be that my wife would seek a teaching position in that area and if one was located, we simply move back there. This would also likely involve me converting to a stay-at-home dad. Why do this, you ask? The biggest factor is housing costs. The area where we would move to has homes that cost 40 to 50% less than the homes do in this area, because not only is it rural, but there are no major cities anywhere close to the area at all. This option eliminates child care costs and reduces housing costs, but has the greatest salary reduction and causes the greatest change by far to our lives.
To me, the third option is the one that is the most pleasant, but it’s also the one that is going to require the most careful planning and probably require the biggest amount of cash in hand to make it happen. It also happens to be one that my wife is most uncertain about in terms of her own feelings.
As many of us know, moving from a city area to a rural area can be the most effective savings technique. We know this from The Millionaire Next Door (required reading for the aspiring millionaire) and from common sense! The reason Trent's post caught my eye is because the reason why I am saving $10,000 in 6 months is similar to Trent's situation.

In October 2007, I along with my girlfriend will step on board a budget flight to Orlando from Dublin Airport, it will be a one way flight.

I love the UK, I love the people, the climate, the feeling I get here. But there is one annoying factor. It's damn well expensive. In terms of taxes I pay the equivalent of almost $10,000 per year. In terms of consumer goods, everything is double the price that it is in The States. House prices are incredible. For a 2 bedroom 1 bathroom terraced house, you're looking at the equivalent of $350,00 - $600,000.

As you can imagine, the final straw came when my girlfriend decided we would look into buying a home. Upon realization that there was no possible way of getting a mortgage without falling into massive debt for many years, I broached the subject of moving back to Florida and buying a home there. When I say Florida, I'm not talking Miami or Orlando. I'm talking rural. After many weeks of research I finally convinced my girlfriend (a city girl) that this was the best position for us financially.

It's a difficult decision to just pack up and move to another city, state, or in my case country. There are different factors in each situation, in my case I have family to think about. But when you sit down and weigh out the differences, the situation becomes clear. In the end of it all, I didn't convince my girlfriend, the facts did.

I'll look forward to updating you on that chapter of our lives when we get there. Until then lets focus on this $10,000

Revamped RSS feed

I've revamped the RSS feed, so if you can please scrap the old feed and use this feed instead


Saturday, 14 April 2007

Saturday Links

Every Saturday I will post some of my favorite articles of the week.

Leo over at Zen Habits talks about doubling your productivity

Trent at The Simple Dollar talks about saving some money at the grocery store using Grocery Store Math

Dawn at Frugal For Life talks about decorating frugally

I read these blogs on a daily, twice daily, and three times daily basis. If you're not familiar with them, go ahead and read through them, its worth it.

Saving money on heating

The Tight Fisted Mister has a post on heating his apartment in April.

I moved to England from Miami a few years ago. In Miami, heating is not a big expense, infact it isnt an expense at all. So when I arived in 'Ye Olde Damp Country' I cranked my electric heating on 24/7.

It didn't take me long to realize how much money this was costing me, so I started looking into alternative heating ideas. I found one method to stick out above the rest in terms of cost effectiveness.

Portable Gas heating offers a convenient and frugal way to heat any area of the house. With a cheap start up price £100 for the portable heater and a 15kg barrel of butane this method is a clear winner.

How does it work?
You buy a 15kg butane canister and plug it into the portable heater. 15kg's is enough for 200 hours of use at it's highest setting. You roll the heater where you want it, turn on the heater, and in about 2 minutes a normal size room is fully heated.


  • Replacement Butane is very cheap (£20 if you trade in an empty canister).
  • Does not use electricity
  • Can be rolled to any room in your house.
  • Very quick to heat.

  • Very faint smell of gas when you first turn it on (my girlfriend hates this).
  • Not too safe around kids and pets.
  • You must open a window or door slightly when the gas heater is in use.

Final Costs:
£100 for the portable heater and 15kg butane
£20 for every replacement canister of butane

A one 15kg canister of butane can easily last a month (even more if used frugally) so we're looking at £20/month.

Thursday, 12 April 2007

Cutting the fat on your budget

Is your budget bulging around the waist? It could be time to cut the fat, it sure is for me.

I am already living to a tight budget, I need to be to realize my goal of $10,000 in 6 months.

Lets break down my monthly budget briefly. Items in Blue are adjustable and can either be higher or lower based on my habits. Items in Grey are "fixed".

Rent: £485
Food: £80
Electricity: £40
Petrol: £40
TV,Internet,Phone: £18.99
Cell Phone: £20
Car Insurance: £183
Entertainment: £20

This comes out to £887 a month.

How can I cut the flab?

First lets look at the adjustables

  • Food: I have allocated £20 a week for food. However, my girlfriend and I have managed to buy a month's worth of food for £34.00. How in the world.... Look, you need to be vigilant, you need to look around for the best deals. Check out The Simple Dollar's article on choosing a new grocery store. Also consider writing out a detailed meal plan. We realized that we could have awesome left overs either for dinner or for lunch at work. Having an effective meal plan not only saves you money, but also allows you to assess the amount of nutrition you are getting. This month we've cut £46 off the food budget.

  • Electricity: Being frugal with electricity is not only good for your wallet, but also has important environmental impacts. By doing a few simple things you can save tons of money. I'll post an article on saving electricity later, for now lets examine it within my budget. I have allocated £10/week for electricity. By breaking old habits (like leaving the computer on all night) and being aware that electricity COSTS MONEY we have managed to make £10 last 2 weeks! Therefore, our electricity costs this month are going to be somewhere around £20. That means we have cut £20 off the electricity budget.

  • Petrol: Boy, isn't petrol expensive. You guys in America have it easy. I'm paying anywhere from £.88 to £.98 per litre! When I wrote out the budget I knew I would have to cut down on driving. So i set myself a strict budget of £10/week. Seeing as it costs about £20 to fill my tank, i knew I had to choose wisely when I drove. How can I cut the fat here? This one is a no brainer. It's Spring now, the weather is better, the sun is shining, and I only live 3 miles from work. Time to brush the dust off the bike. By not using the car during the week, every week, I am saving myself up to £20 a month! This is one advantage of living in a city, we can walk everywhere...and now we do! Savings on petrol: £20.

  • Entertainment: This is for when we have to see that new movie (300) or we need to treat ourselves to a drink at the pub. But generally, we download all our movies, and when we buy drinks we buy them from a Polish store called Budget Booze...classy. This is the only part of our budget where we have overspent. By £10... So no savings here.
Next lets tackle the "fixed" areas of our budget. These may be payments that are bound by contract such as a mobile phone, or cable. But as we'll soon find out, these aren't set in stone and can be reduced.

  • Rent: Our rent is £485 / month. That's cheap for Bristol, but not cheap enough for me. It just so happens that my rental contract is up on May 1. I also found another apartment for £350 a month. I asked my landlord if he wanted to match that price, and if he couldn't then we would be moving on. We're moving on. You have to be willing to make sacrifices to meet your goals, and seeing as we are leaving the country in 6 months, this seems an easy sacrifice to make. Savings: £135 / month

  • TV,Internet,Phone: £18.99 for all three! What a good deal you may be thinking. Your right, it is a good deal. This same package was offered for £30/month. This is how much I was paying up until last month. My cable TV provider had lost 2 very good channels when I called to complain, they apologized profusely and offered to drop the price to £18.99, and I had only been a customer for 4 months! If a service provider is disappointing you contact them and let them know. Ask outright for some sort of discount and you'll probably get it. Savings: £11/month

  • Cell Phone: Before my days of frugality and savings I bought a Blackberry. Damn it was cool. caught onto the inclusion of the past tense verb "was". My Blackberry was stolen while I was on holiday. I was paying £35/month for phone service, and blackberry data package. I called T-Mobile told them my situation and they turned off the blackberry data package saving me £15/month

  • Car Insurance: £183 a month for insurance! Highway robbery, they must know that they give away licenses in Florida and hike up the premium. In all seriousness, I am paying such a high premium because of my age and the fact I am driving on a international license. How can I reduce this. Is your car worth more than £5000? Mine isn't. Then why did I splurge for "full comp" instead of the bare bones "third party" ? Unless your car is worth it, full comp isn't cost effective. I called up my insurance company and reduced my monthly charges to £150. Savings: £33
So how much did weight did my budget lose? Excluding TV,Phone,Internet, and Cell Phone (these were reduced in March) and subtracting £10 for the overspend in Entertainment....

we have saved £244 !

Please digg this article if you found it informative.

Wednesday, 11 April 2007

Smokers save you money

I want to start by thanking all the employees at my job who smoke. These poor suckers smokers take on average 15-20 minutes out of their work day to enjoy a slow suicide. And they get paid for the pleasure.

So how can this make me money?

I get up to one hour unpaid lunch break everyday, but it is up to me to decide how much of that hour I take. To maximize my daily earnings I have been taking 15 minute lunches. Some people need more time than this, but I find any break longer than 20 minutes tedious. However, these 15 minute lunches still are unpaid.

This is an injustice, you get paid to smoke on the job but not to eat. Instead of clocking out for lunch, I will take the smoking time that I deserve and use that time to eat my non-carcinogenic lunch.

I get paid £10/hour. On a normal day I will make £70. By using my allocated smoking time to eat I will earn £80 in a day. That's £10 extra a day!

But wait, what if I get into work a 1/2 hour before my shift starts. Not only does this show your boss that you are committed to your job, but it also allows you to settle into your day in a more relaxed way. To top it off, leaving for work just 15 minutes earlier than usual can drastically cut down of the amount of time you're stuck in traffic. If I leave at 8:30am I won't get to work until 9:00. However, if I leave at 8:15 I'll be at work by 8:30!

By getting into work at 8:30 and using my allocated smoking time to eat lunch i am adding £15 to my daily earnings. That's £75 more a week. That's £300 more a month.

So yes. Thank you for smoking.

Somethings Gotta Give

In order to meet my goal of saving $10,000 in 6 months somethings gotta give.

April is our first month of living to a budget and so far we're doing pretty good. This is our experimental month, we're seeing how much we spend and where we spend it. So far the results are good.

Our best area so far is electricity. We have a "pay as you go" electricity box. You top up your card at the post office with however much money you want, when you get home you stick the card in the box and that's it. This is very useful for budgeting purposes, as we can see how much electricity we are using and how fast the money goes.

We topped up £10 on the 29Th of March and today we have £5 left! This is great ,2 weeks of electricity for £10. At this rate our electricity costs per month should be somewhere around £20 instead of the budgeted £40! A savings of £20 a month!

The majority of thanks needs to go to my girlfriend, she does everything she can to conserve electricity, I'm sure her list of todo's will make it up here at one point or another.

More on point with today's topic is giving something up to reach your goals. In this case I am giving up driving my car to work everyday and instead riding my bike. I live 3 miles from my job, it's a disgrace to the environment and to my bank account to drive there everyday, especially now that winter is behind us. The savings to our fuel budget will be great! Currently I have £40/month allocated to fuel. To fill my tank it takes £25, usually i need to refuel twice a month. By cutting out my work commute I should be able to nix one full refuel dropping the monthly cost to £25!

The point is we need to give and give and give to later receive. Cutting out a comfort like a car won't kill me, in fact it will make me healthier. And I'll be saving money at the same time. Sounds good to me.

Where we stand...and what we're doing

Oh boy am I in a bad situation.

  • Checking Account Balance: -£183.07 ($359.45)
  • Savings Account: £0.00
  • Tax Free Savings: £0.00
  • Credit Card Debt: £0.00
As you can see I am currently broke. I am one month behind on my rent, and I don't get paid until the end of the month. Oh yeah... I need to save £5,000 in 6 months. Yup that's $10,000 folks.


You may be wondering why I would set myself such a ridiculous goal. $10,000 in 6 months! In 6 months, I'm moving back to Florida. I've been in the UK studying and working for the past 2 years,my girlfriend and I both decided it's time to move back (more on that subject later). The thing is, I definitely do not want to move back without a good financial cushion (and lets face it, my current financial situation is no cushion....more like a ditch filled with poison tipped spikes). The plane ticket is bought, the accommodation is set (I'll be paying the mortgage on my dad's house in Florida) all I need is to buckle down and set my sights on my goal.

How the heck am I going to save $10,000 in 6 months? I would need to put away $1,666 each month. I don't know about you, but after rent, gas, groceries, electricity, and water... I don't have $1,666 left.

1. Favourable Exchange Rate

£1.00 = $1.97

The exchange rate has been stable since December usually fluctuating between 1.95 to 1.97. Based on these rates $10,000 is equal to £5,092

In order to save £5,092 in 6 months I will need to put away £848 per month (still a hefty amount. but more doable)

2. Living To A Strict Budget

I make £1,024 per month. My goal is to put 30% of that into my Tax Free Savings Account ( I can put £3,000 into this account per tax year)

That leaves me with £716.80 to pay our rent, pay our bills, buy our food, put gas in the car etc... Obviously with this amount of money to work with, we need to live very frugally. I will post our budget in another post so you can see exactly where everything is going and how much we're spending.

3. Finding Additional Sources of Income

I am a professional web developer by trade, so it is easy for me to find people who want to learn how to make websites and tutor them in the dark arts of web design. I use craigslist and gumtree to advertise my services for free. Currently I have 1 student and another who is interested. I charge £20/hr and put that money directly into my Tax Free Savings.

Being a web developer freelance web projects are of course a potential gold mine. However, this is a very over saturated market and getting contracts are not that easy. I will make more of an effort to acquire more freelance contracts, as this is going to be the area I will make substantial sums of money (£350 - £1500) that could go directly into savings

The key here is to set a good portion of your monthly salary into savings and live within your means. Any additional income you may acquire should be ignored and placed into your savings immediately.

The question is can I do it. Can I save $10,000 in 6 months?