Buying your first home

Last year I was sent a press release from a mortgage broking company that said

“It is becomingly increasingly difficult for first home buyers to save the deposit they need in order to purchase a property worth hundreds of thousands of dollars”.

This is the sort of statement that makes me get a little hot under the collar.

The CEO of that company then went on to say – “it was time for the government to act and do something before home ownership stops being the great Australian dream and becomes the unattainable dream”.

That sentiment really makes me cranky….

Over the past 70+ years, since the end of the Second World War, home ownership has been hailed as the best way to keep Australia safe; by owning your own piece of the country.

Unfortunately in todays’ society where living for today has taken precedence; the purchase of a home has been put on the back burner for many people. But what’s wrong with planning for tomorrow and living for it?

Many times in the media we hear and read stories of people who would like to buy, but can’t afford the price.

Taking on the responsibility of home ownership is a personal decision. It has nothing to do with the government.

From all the people that I help in setting up a budget, I find that buying a property has nothing to do with ‘affording the price of a house’. The reason many people don’t buy a house is because they have different priorities and that’s where they spend their money.

For many of them, home ownership is close to the bottom of their priority list.

Of course, once the purchase of a house moves up their list, they then get serious and the first thing they do is get a budget organised.

Buying your own home has always been affordable for those who want one. Part of that process is to curb the desire to spend on other priorities, set goals accordingly and work towards the end result.

Of course, managing your money realistically has a lot to do with attaining the outcome. And being practical about where you can afford to buy your home will also make the goal easier.

I get a little surprised however, by the young folk of today that live with their parents for 25+ years. They have a good income yet pay no living costs. They also don’t have any money saved towards a deposit for a home. It makes me wonder what on earth they spend all their money on.

Sadly, for some people the only hope of owning a home will depend on an inheritance from the generosity of their parents.

I am curious to know if they’ll continue to live in the family home until that time.

Bottom line? If you really want to purchase your own home then the first thing to do when getting started is to organise a budget.

But you knew I was going to say that, didn’t you?

 

 

©   Carmel McCartin – Budget Bitch

And don’t forget – (The views expressed in this blog are the personal opinions of the author. Don’t rely on them to make financial decisions; you have to make up your own mind. If you don’t like the content – then either stop reading or send me an email)

 

The truth about ‘downsizing’

Downsizing the family home is a term used by lots of people in my parents’ generation and it’s now becoming a ‘buzz word’ for the baby boomers.

So what does that mean? What exactly is downsizing?

A few years ago, whilst working in real estate, lots of older people told me that the reason they wanted to sell their house was because they “needed to downsize”.

At the time I accepted that – but I didn’t really understand it. Why on earth would you throw away 30 plus years of memories and collectables to jam yourself and your dearest possessions into a home that’s one third the size, with no room to keep all your familiar things?

It didn’t make sense to me.

But then when I worked as a mortgage broker I saw some ‘hidden reasons’ as to why people have a need to down-size.

My parents’ generation and indeed many of the baby boomers have never had the opportunity to provide adequately for their retirement. So, once they retired – all they had to live on was a government pension. As we know that’s barely enough money to provide more than a basic standard of living.

With things being a constant struggle, and the only asset they owned being the family home, it made sense to sell that home and buy something smaller. (Thus the term – downsizing)

So, in doing this, the maintenance costs on a smaller place are less and sometimes the running costs are also smaller. Regardless of where you live – your utilities will be pretty much the same cost as they are now. (unless of course you move to another country)

In the past, selling a larger house and buying a smaller unit or town-house would result in a reasonably good-sized chunk of money left over after the sale. This could then supplement the old-age pension and the quality of life for the retired was improved.

But the property market doesn’t stay static. Not only have house prices risen, so too have the prices of units. So the tired and in-need-of-maintenance homes owned by the strapped-for-cash retirees are no longer fetching as good a price as they could have.

Their owners just don’t have the funds to re-furbish and re-paint to ensure a better price. And if they do, they possibly won’t have a need to sell. Often these days, there won’t be a good-sized chunk of money left over at the end of a sale. It can seem that there is no point in ‘downsizing’.

Some people have decided to continue on the downsize plan. For them it means that they can live in a smaller and newer house that requires little in maintenance and maintenance costs for the rest of their lives.

In some cases, some of them have had to take out a mortgage to do this and therefore put their already stretched finances under even more strain.

So where is all this leading? Well, I guess it all comes back to planning; planning now for your retirement and for the major financial decisions for the future.

If you’re still working and feel that you’ll have a need to ‘downsize’ your home (for whatever reason) then perhaps it makes sense to do so before you retire from the workforce. That way at least you’ll still have a renewable income to ease the costs of selling and moving house and perhaps a small mortgage.

Or maybe it would just make sense to start working on a household budget – to ensure that you can live on your retirement money without the need to sell your most loved asset, your home.

 

(c) Carmel McCartin – Budget Bitch

The words expressed in this post are, as always, my personal opinion. If you want to argue  – send me an email.

Back to school

 

 

At the end of this month a new school year will start. It can be a hefty financial time for many parents, not only do they have school books and uniforms to pay for, but for some there is also the cost of school fees.

Perhaps the greatest tip for minimizing these costs is to be sensible about purchasing only what your child needs as opposed to what they want or what the back to school catalogues tell you to buy.

If you are new to all this and have a child starting school for the first time, perhaps you could ask other parents with school age youngsters for some help with discerning what the essential items might be. There’s not much sense in sending a first timer off to school with a bag full of items that won’t be used until secondary school.

Of course, there are many other helpful hints but here are my top five.

 

 

©   Carmel McCartin – Budget Bitch

And don’t forget – (The views expressed in this blog are the personal opinions of the author. Don’t rely on them to make financial decisions; you have to make up your own mind. If you don’t like the content – then either stop reading or send me an email)

Happy New Year

It’s the start of a new year – 2017.

Now that we’ve got the past year and all its trials and tribulations behind us, we can start afresh and begin this year with a clean slate. Wouldn’t it be great if we had a crystal ball and could see what this year holds for us all!

Of course, at this time of year, we hear much about ‘New Years Resolutions’ – “have you made any?”, “did you keep the ones you made last time?”, “do you make different ones every year or do you trot out the tired old ones that don’t seem to make it past the first few weeks?”.

When the topic was raised at a family BBQ, it was interesting to hear the different explanations about the practice to the younger generation. It was summed up beautifully by one young nephew – it’s really planning your goals for the next year”. 

According to some newspaper polls more than 33% of the population resolves to pay off their credit cards each year, but statistics also show that 60% of New Year Resolutions are long forgotten by June.

It’s a great idea to plan some goals for the coming year but if your list is very long you may find that you struggle to achieve too many of them. Sometimes it’s easier to just have three or four resolutions, make a plan that works towards the end result, and then you will find that you can conquer them all. There will be slip-ups along the way but if you stick to the plan you’ll soon get the result that you want.

Don’t forget to make a ‘family’ resolution this year, after-all they’re the important people that make our lives worthwhile. A ‘financial’ goal is also a great way to start the New Year.

If you’ve got your budget under control – keep up the good work! If you’d like a health check for the state of your finances – please don’t hesitate to give us a call.

 

(c)  Carmel McCartin – Budget Bitch

And don’t forget – (The views expressed in this blog are the personal opinions of the author. Don’t rely on them to make financial decisions, you have to make up your own mind. If you don’t like the content – then either stop reading or send me an email)

I wish you a trim & taut body for 2017

So here it is – New Year’s Eve. And by this time tomorrow we’ll be sitting back contemplating the first few hours of 2017.  (Of course, there are some of us who will be nursing a more fragile state of mind)

Most people that I’ve spoken to recently tell me that they hope to pay off their credit cards at some point in time during the coming year.

But did you know that Australian households overtook the Swiss as the world’s most indebted this year?  Our outstanding debt is equivalent to 125 per cent of GDP and there seems to be no change in sight. As one of the highest ratios in the developed world – that’s a lot of debt!

During 2016, the Deutsche Bank  calculated that the ratio of average Australian weekly mortgage interest payments to weekly income had increased from 53 per cent in September 2013 to 66 per cent in December last year. That’s higher than the 57 per cent average and comes despite exceptionally low interest rates.

A financial goal is also a great way to start the New Year. If you’ve got your budget under control – keep up the good work! Perhaps it’s time to reassess where it’s heading.

If you don’t have a working budget in place, then maybe it’s time to take some responsibility for your finances and get them into better shape.

I find it amusing how many people spend so much money on gym memberships to get their body trim and taut, but never give a thought to spending anything on getting their finances into better condition.

Making your body look and feel better is a work in progress and sometimes, to get the results that you want, if you’re not careful you could end up spending money on that pursuit for the rest of your life.

Getting your finances to look and feel better is also a work in progress. But, unlike the gym, it only takes one appointment with Budget Bitch to learn how to get the results you want for the rest of your life.

It’s not expensive – call me!

 

(c) Carmel McCartin – Budget Bitch

And don’t forget – (The views expressed in this blog are the personal opinions of the author. Don’t rely on them to make financial decisions, you have to make up your own mind. If you don’t like the content – then either stop reading or send me an email)

Christmas – what do you remember?

I still have my first doll. Actually, it’s the only doll I’ve ever owned and it’s possibly stood the test of time because I didn’t play with it much. Why would you play with a doll when there was always a real live baby in the house to play with?

I got it for Christmas when I was a pre-schooler. I don’t remember actually ‘getting’ it but I know that it was a Christmas present.

When I think back through all those Christmas festivities in my life, I can’t remember too much about the gifts I received. But I do remember the games we played with the family members that visited.

As we grew older our games became a little more sophisticated and the laughter became louder.

There was no shortage of food and we always ate too much. As a kid, I always wondered why the adults always had to have a nap after dinner. As an adult, I’ve discovered the reason why.

They were happy times and my memories are filled with love and laughter. With all the emphasis that’s put onto gift buying these days, you’d think that I’d remember everything I got and who gave it to me. But I just simply don’t.

I remember the good times but I can’t remember the gifts.

 

Sometimes I think we’ve all forgotten that  the best Christmas memories are about people and events – the size and cost of the gifts are insignificant.

©   Carmel McCartin – Budget Bitch

And don’t forget – (The views expressed in this blog are the personal opinions of the author. Don’t rely on them to make financial decisions; you have to make up your own mind. If you don’t like the content – then either stop reading or send me an email)

Planning your budget for Christmas

A Tip – Money Tips from the Budget Bitch

 

With just a month until Christmas Day, I thought I would share an excerpt from my book – “Money Tips from the Budget Bitch”

 

12 .  Don’t leave your Christmas shopping till the last minute.

There are so many of us that do this… and then we find that because we’re out of time, we dash about in a frenzy and actually spend more than we intended. Sometimes we even buy things that are totally unsuitable, either as gifts or refreshments.

How many times have you finished the festive season with almost half the foodstuffs that you started with? Sure, it means you may not have to shop for a week or two but are mince pies, nuts and pretzels really something you want to eat everyday?

A little pre-Christmas planning and thought will go a long way in making sure your budget parameters are met.

 

Do make lists well before December.

Buy gifts to suit the tastes of a particular person rather than buying a gift to suit a monetary figure.

 

You can also find more great tips and hints by clicking this link

 

©   Carmel McCartin – Budget Bitch

And don’t forget – (The views expressed in this blog are the personal opinions of the author. Don’t rely on them to make financial decisions; you have to make up your own mind. If you don’t like the content – then either stop reading or send me an email)

 

How to fit Christmas into your budget

In just a few weeks’ time it will be Christmas – one of the most financially stressful times of the year.

We all know how important it is to not have a financial blow-out, yet every year we hear horror stories about families that suffer terribly as a result of over-spending.

Whilst we all seem to over-eat and drink too much over the holiday season, it’s the money carnage that has the biggest impact.

It’s a crazy time of year for sure. Before you get too embroiled in all the celebrations, let’s take a moment to share some thoughts about the festive season…

Christmas is just one day of the year.

If Christmas is a time for your family traditions, then now is the time to talk about changing or adding some new ones that won’t break anybody’s budget. You’ll possibly find that there are some other family members who are secretly longing for this to happen.

Perhaps your family would benefit from a ‘pre-Christmas planning’ day which will give everybody a chance to plan for the event properly. Why only get together once a year?

Christmas is a time of sharing.

Not only do we share food and drinks but we also share time with our family. Some do that willingly; some do that because it’s expected of them.

It’s not always easy to get a family of different personalities together for a day of bonding. There are bound to be some frayed and jagged nerves by the end of the day.

If you’re hosting the family Christmas party and will have a house full of guests, then hopefully they’ll contribute something or share some of the chores. Let’s face it – it’s no fun cooking for a crowd and then having to wash all the dishes as well.

If this is what usually happens at your place (or wherever you spend Christmas), then maybe it’s time to change some of your Christmas traditions. You’re probably not the only person who needs to watch their money.

Perhaps your ‘traditional dinner’ could be divided into parts that each guest could provide (eg: somebody brings the turkey / ham, somebody else provides the veggies. The pudding could be supplied by somebody else, and the custard could also be made by another guest. Are you getting the idea here?)

  • Consider keeping it simple – you could always arrange for a ‘buffet’ lunch, where everybody brings a platter.
  • If you are cooking lunch at home, delegate tasks. You don’t need to do everything yourself.
  • Share the cooking – ask guests to participate by contributing a part of the menu. Don’t forget that there are other people who would love to bring their ‘family favourite’
  • Plan your menu in advance and also use a shopping list
  • Store brands are great for side dishes and salads etc – nobody will even realise!

And of course, it’s not just the food costs that need to be calculated, liquid refreshments also need to be considered.

  • A lot of money is spent on alcohol at Christmas. Try serving guests a festive glass of punch – you can even stretch out servings with apple juice.
  • Christmas Punch goes a long way, and is less expensive (alcoholic and non-alcoholic).
  • Use lots of ice – this also helps make drinks last longer when the weather is hot

Christmas is a time of giving.

When it comes to gifts, many of us tend to go overboard in that department. How many times have we heard people tell us that Christmas has become too commercial? Or – ‘it’s the thought that counts’ when it comes to gift giving.

Have you ever wondered why so many people seem to place such great importance on the price of the gifts from family members that they only just tolerate and hardly see throughout the year?

We’ve all heard many times, the complaint – “the stingy so and so only bought me a measly ….”

Of course, for those whom we love unconditionally, we’d accept the button off their shirt as a gift – if we knew that was all they could afford.

Maybe this Christmas we could give an extra gift of tolerance and understanding to those relatives who we find hard to love. It won’t cost anything and you may be surprised by the results.

When it comes to buying presents, the first thing to do is to make a list of everybody that you need to buy a Christmas gift for and stick to the list! Then –

  • Work out how much you can comfortably afford to spend on each gift, and do not overspend.
  • Consider a Kris Kringle (Secret Santa) for large family gift-giving events; where everyone draws a name out of a hat and buys a present only for that person. (You’re not the only one on a budget)
  • Choose a theme for your gifts – Calendars, books, chocolates, home-made treats, socks, pens, glasses, pillows, etc. This works really well with a Kris Kringle because the focus is then placed on getting the most suitable gift to for each recipient.
  • Give vouchers – lawn mowing; painting; baby-sitting; house cleaning etc. Nowadays people are time poor, not possession poor.
  • Spending time with loved ones is the best gift of all. Consider a family day pass to the zoo or theme park. Movie tickets for a family outing will also be appreciated

If you are one of those people that just love to decorate the house to celebrate the season, then you may also need to keep an eye on those costs.

  • Don’t over-spend on decorations. Recycle the ones from last year or just add one or two new pieces
  • Wrap gifts in bright and glossy junk mail—it all ends up in the same place in the end!
  • If you must have Christmas lights all over the place – get solar-powered ones and at least cut down on your electricity usage
  • Buy inexpensive candles and decorate them yourself with a Christmas theme. Use tinsel, glitter and ribbons to decorate and save money instead of buying pre-packaged Christmas ones.
  • When decorating the dinner table: Buy inexpensive glasses and paint each guests name on the side, or attach a tag with each name to a glass stem. As an extra gift for everyone this also helps with having heaps of glasses to wash. (each guest takes their gift-glass home)

 For lots of people, spending time with family and loved ones is the best part of Christmas and it’s important to remember that the best Christmas memories are about people and events. The size and cost of the gifts are insignificant.

If you haven’t already, it’s a good idea to start your Christmas planning now. Doing this will avoid a major ‘money melt-down’ due to lack of preparation.

Did you know that people who leave everything to the last minute will spend more money because they’ve run out of time?

So it doesn’t matter how much money you do or don’t have, you can fit Christmas into your budget. If you spend more time on the planning, you can make sure you spend less money on the event.

 

© Carmel McCartin – Budget Bitch

And don’t forget – (The views expressed in this blog are the personal opinions of the author. Don’t rely on them to make financial decisions; you have to make up your own mind. If you don’t like the content – then either stop reading or send me an email)

It’s never too late

This morning I sat down to write something about budgeting for the blog and then realised that the end of 2016 is really not that far away.

Once again, the year seems to have slipped away so fast and it made me think about all the things I said I’d do this year. I’m not talking about New Year Resolutions because let’s face it – who keeps those anyway?

So let’s see if some of the things I promised myself I’d try to improve have been done …

  • Go to the gym on a regular basis – check
  • Put a regular amount into my holiday account – check
  • Write another book – Have got it started, but it’s going slowly
  • Go to bed earlier every night – well … I’m working on it, ok?
  • Lose 7 kilos – errrrrrr…. Next…..

So now that it’s November, I realise that I still have time to put some steps in place so as to improve the areas where I have been a little slack.  I know I won’t get everything finished before the end of the year; but at least I won’t be putting off making a start.

And I can still hear my mother saying – “Never put off till tomorrow what you can do today” *sigh*

Nonetheless, I’m not going to be too hard on myself for being a little slow off the mark in getting these projects started. It’s human nature to procrastinate when it comes to ‘difficult’ tasks. Sometimes it’s the very thought of doing something that makes us want to procrastinate.

What have you put off starting this year?

Could you get cracking today to finish the year on a high note? It’s surely got to be better than just sliding to the end on empty promises that you made to yourself.

 

 

©   Carmel McCartin – Budget Bitch

And don’t forget – (The views expressed in this blog are the personal opinions of the author. Don’t rely on them to make financial decisions; you have to make up your own mind. If you don’t like the content – then either stop reading or send me an email)

 

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