WRITING: MONEY-WISE
Aug 02
Oct 02
Jan/Feb 03
Apr 03
Jun 03
Aug 03
Oct 03
Jan/Feb 04
Jul 04
Oct/Nov 04
Jan 05
Mar/Apr 05
Jun 05
Dec 05
Mar/Apr 06
Jul/Aug 06
Are you Taking a Bath? (Aug 02)
A colleague recently asked me if I had come into some money – perhaps a lottery win or inheritance?
Answering “no” brought a puzzled reaction from my questioner. Apparently he had just learnt the location of my house, and couldn’t comprehend how I could afford to live in such an area. He knew we were about the same age, and were earning about the same income.
The phrase “living within my means” seemed to wash right over him without sinking in. He was too focused on the price range of homes in the area, and how he couldn’t afford to live there.
It does sound obvious, but no matter your income, if there’s more money leaving your wallet than coming in, you’ll never get to a position of financial strength. It’s like trying to fill the bath with water, while leaving the plug out!
There’s heaps of ways to save, earn, spend and keep money. What works for you depends on your money values (more about them in future issues of Kiwi Stride) but the important first step is to know your current financial situation.
Staying with the bath-tub theme, imagine your bathroom…
1. How full is the bath?
…got any money in the bank?
2. How fast is the water coming out the tap?
…what’s your income?
3. Is cold water emptied out and replaced with hot?
…how much is spent on regular bills?
4. What’s splashing over the side of the bath?
…the interest payments on loans and credit cards.
5. Does the water level get lower each time you bathe?
…is your spending greater than your income?
6. Would you like a spa-bath?
…what are your money goals?
There’s nothing worse than sitting in a bath of cold water, with the water slowly escaping from a plug that doesn’t quite fit. What can you do to get a new plug (i.e. reduce your spending), or increase the flow of water (improve your income)?
Many people are surprised at just how wet the floor gets! Consumer debt (loans, furniture, car, credit cards, clothes, etc) is often a big reason for the water level staying low and cold.
And why have I included #6? Because it’s easier and more fun keeping track of your finances when you have a reason to do so! Give it a go – take a bath!
“Luck is not chance, it’s toil. Fortune’s expensive smile is
earned.”
Emily Dickinson
Got Enough? (Oct 02)
I asked a random sample of 110 women at the recent Women’s Lifestyle Expo, “What’s the hardest part of managing your money?” I was surprised to have 32% answer “Not having enough” or comment on their difficulty in earning enough. That’s almost one in every three! Are you in the same boat?
Money is simply a tool that assists the flow of goods and services. It has no power or emotion of its own – only that which we give it. So the first question I have for you is: what does money mean to you?
When you deal with money, are you trying to create a feeling of stability and security? Are you attempting to create a nice environment or buy new things? Do you desire the freedom to do what you want, when you want to do it?
Your money values act as a compass, guiding you on your financial journey. And because we’re all different, no set-in-stone rules can apply for everyone. It’s all about self-awareness and conscious choice. What direction are you heading?
“People have the
wrong idea about money. They spend their lives chasing a myth –
that the man with lots of it is happy by virtue of his wealth, and
that people without money are unhappy. In doing so, they create a
vision of something they want – realising later that, in fact,
they don’t want it. The only way to enjoy life is to keep one’s
needs simple.”
Sir John Moores
Credit Card Capers (Jan/Feb 03)
A newspaper article caught my eye in January. It reported that only 50% of people using their credit cards for Christmas spending expect to completely pay the balance during the interest-free period.
Another 25% knew they were going to pay interest for at least the following month. Over 5% had no idea when they would pay off the balance, with some still paying for the previous Christmas! That’s an awful lot of people paying an awful lot of money!
The survey I did at the Women’s Lifestyle Expo mirrors this trend – 17% of the women questioned described the hardest part of managing their money as ‘not spending it’, or ‘overspending’.
Are you constantly battling the credit card bills? Does it seem when you get close to paying it off the bank sends another letter, increasing your credit limit? It’s certainly an easy trap to fall into.
Here are five ideas to help change the spending-on-credit pattern:
-
Plan in advance. Christmas will be in December this year too! Work out now how much you’re likely to spend on presents, food and holidays. Put aside some money each week and let it grow into your festive stockpile!
-
Be strong when temptation strikes. Is it still a bargain after you’ve paid the interest on your credit card? What happens if you’ve maxed your card and a real money-emergency comes along?
-
Do you need to carry your card with you? I’ve heard of someone who keeps hers in a block of ice in the freezer. By the time it thaws, she’s forgotten why she wanted the item in the first place!
-
Keep a ‘want’ list. When you come across things you haven’t budgeted for but would like, add them to the list. Wait 30 days. If you can remember why you wanted the item after one month, then work out how to pay for it. (This is a great way to stop buying things on impulse that you don’t really need).
-
Take the time to work out how much you’re paying each year in interest. As scary as this sounds, it’s often the jolt you need to take action. One way to reduce the interest is to transfer the balance to a lower-interest personal loan. Ask your bank for the details, but then don’t use your card!
Credit can be a useful money-tool, but falling into deep consumer debt creates stress and worry. Gaining control of your money habits can bring an amazing feeling of confidence and strength.
“Money is a good servant but a bad master.”
French
proverb
So What is Success? (Apr 03)
What's your definition of Success?
Many folk struggle to answer this question. In some ways, it seems too obvious. "A better job," some reply. "Winning the lottery," or "Meeting Mister / Miss Right," say others.
The media often answers with "fame, fortune, and beauty".
But what does it mean to you? In this busy-busy world of two-income families, fast food and instant credit, how will you know when you are successful?
Is money one of your bench-marks? How much is enough? Do you consider yourself not successful (a failure?) because you don't have a big bank balance?
This is a sign of being trapped by I'll be happy when... thinking.
Success is not a destination. It's not about reaching goals, completing tasks or 'getting ahead'. Being the best, keeping up with the Jones', or hiding your true feelings are not productive measures either.
How content you are - right now - is the best indicator of your success.
I'm not saying you shouldn't have dreams and have to work to bring them to life. I'm not saying that you should settle for what you've got, and just give up trying.
I am saying that attitude is a choice, and success is a journey. (Peace of mind is a powerful indicator of personal success).
How content are you with your current situation?
"Don't aim for success if you want it. Just
do what you love and believe in, and it will come naturally."
David Frost
Are You Learning? (Jun 03)
Isn't it funny how often the best education is free?
On one hand it seems that students are encouraged to rack up debt for the sake of some letters after their name.
On the other hand there are numerous examples of both ordinary folk and the famous who have achieved goals and glory with no formal learning at all.
Do you equate the value of what you are learning with the dollars you're spending on it? Or do the most relevant, appropriate and meaningful lessons happen out of the blue?
My dictionary describes learn as: to gain knowledge of (something) or acquire skill in (some art or practice). Have you stopped gaining and acquiring?
If you do feel a bit stagnant or stale, it needn't take the time and money of a course or class to change things...
All it takes is a change of mind.
Make a conscious effort to look for the new, the different, the never-considered... in your own environment. Ask questions, ponder the bizarre and appreciate the familiar.
And the people you live with, work with and play with are a constant source of fresh perspectives and new situations - if you let them.
Cyber-wise, here's a couple of sites that I find stimulating:
Fantastic pictures of far-away places, animals, sports, etc. All can be downloaded as screen-savers. Plus a daily quote.
Fancy a new word appearing in your in-box each day, complete with meaning, usage and history? Plus this site has a very cool anagram creator... 'Kiwi Stride' can be turned into 'Wiser I.D. Kit'!
See, learning and discovery needn't cost a bean!
Most people are willing to pay more to be
amused
than to be educated."
Robert C. Savage
Can You Afford It? (Aug 03)
I admit it... I was drooling.
The glossy brochure I'd pulled from the mailbox was filled with bright, shiny electronic equipment, big screen televisions and home theatre systems.
Have you seen how thin the plasma screens are? Have you seen how big the price tags are?
I have two ideas I'd like to share with you here:
1. "I can't afford it" thinking.
Whether you think this about a new TV, a concert you'd love to attend, or a treat for the kids, make sure it's actually the truth.
There's a big difference between not being able to afford it, and choosing to spend your earnings on something else.
The best phrase I've heard to make this distinction is:
"I'm not going to (buy, attend, spend) because it's not my current priority."
2. 10% Base
How powerful would you feel if you had a sum of money that constantly grew, wasn't earmarked for any purpose and you didn't miss the contributions?
There are companies around now who offer contractual savings plans and retirement schemes, but charge you for that service. Save yourself heaps of fees and do it yourself...
Live off 90% of your earnings and don't spend the remaining 10%.
This provides a growing reserve for unforeseen life-changes or investment opportunities, plus an amazing feeling of financial control.
Sounds too simple, doesn't it? I'm not saying that it's super-easy, because it does take will-power and a bit of 'habit modification' at the start, but I can vouch for the results it brings!
Want to know more about this 10% idea? Just drop me a line...
"Maturity is the ability to do a job whether
or not you are supervised, to carry money without spending it and to
bear an injustice without wanting to get even."
Ann Landers
Value for Money? (Oct 03)
This segment was hatched at a five-year-old's birthday party, and with Christmas only nine weeks away...
When you make a purchase, are you getting value for money?
In today's mass-produced, I-want-it-now, throw-away world, there seems to be an abundance of products that have little, if any, lasting value.
This isn't a question about price, for there are still bargains to be had, and it's easy to get a very expensive piece of junk. I'm asking if the item will last long enough to serve its purpose.
If a child came to you for advice on how to spend their pocket-money, what would you say? Would you recommend the small, low-volume water-pistol they can afford now, the super-soaker with a large reservoir (which is another month of allowance away), or suggest water-balloons, at a fraction of the price of both and just as much fun?
[ Can you tell it's a wonderfully sunny 24 degree Celcius day as I write this? ]
The same dilemma raises its head every winter, with people crying "I can't afford to heat my house", when just a little planning and effort would produce an increase in insulation or efficiency, greatly reducing the heating expenses.
It's about having a bigger picture - knowing how to make the most of the cents, so you've got more dollars to play with!
"Anybody with money to burn will easily find
someone to tend the fire."
Pocket Crossword
Puzzles
Christmas is Coming (Jan/Feb 04)
Now this isn't meant to scare you... but there are 45 more weeks to Christmas.
For many people this won't come as a surprise. After all, Christmas is at the same time every year!
But for some, there never seems to be enough time to save for presents and festive fare (or school uniforms and books, for that matter).
So here's something to consider. If you put aside $10 every week from now until Christmas, you'd have $450 sitting ready for the bank-battering month.
Or, how much do you normally spend on presents? Just divide that amount (say... $225) by 45 weeks to get your savings target (in this case, $5).
Wouldn't it feel wonderful to have a plan in place so early?
"Thorough preparation makes its own luck."
Joe Poyer
Cars Out in the Cold (Jul 04)
I love walking. Especially on a sunny day, walking around my neighbourhood is a great way to blow out the mental cobwebs and get the lungs pumping.
But lately I've noticed something strange... cars parked in driveways, not in the garage. Hmmmm. So I starting paying closer attention to garages with raised doors, and was surprised to see the amount of 'stuff' piled high in many of them.
Here's an assumption - if it's in a box in the garage, it's not being used, so therefore why was it bought (or why is it still kept)?
More importantly from a money angle, all that 'stuff' piled high is keeping the car out in the elements! Which is of greater value and faster depreciation?
With the southern-hemisphere spring just around the corner, have you given thought to a spring-clean? Imagine what you could do with the cash raised from a garage sale!
And I'm sure your car will thank you for the extra space...
"It is not the man who has too little who is poor, but the one who craves more."
Seneca
Doing It For Nothing (Oct/Nov 04)
A Scout Troop in my area sent a notice home to parents, asking them to help keep the hall tidy by selecting one week of the year when they could come to sweep the floor and clean the toilets.
Several forms were returned with the message: "Increase everyone's subscriptions by $5 and pay someone to do it".
Are these the same parents who get their knickers in a twist when their children won't help around the house, can't motivate themselves to study, or expect to be driven short distances to school, sport or the mall?
I've just had a weekend with 50 other volunteers - putting the finishing touches on a Jamboree for 4,500 Scouts and Leaders from around the globe this New Year. Do they do it for the money? Obviously not.
Do they do it for the logistical challenge? Perhaps.
Do they do it to see the wide-eyed smile of the mud-caked Scout emerging from Hobbit's Challenge? Yes.
Or the whoop of success from the nervous first-time abseiler? Yes.
Or the sense of harmony as children from NZ, Tonga, Japan and Australia swap badges? Yes.
There's more to life than increasing subscriptions...
"Sometimes you earn more doing the jobs that
pay nothing."
Todd Ruthman
Different Presents (Jan 05)
How do you buy Christmas presents?
I don't mean whether you pay cash or use the credit card. I mean what's the thought process behind each gift?
Do you carefully consider each person's likes and interests, pondering thoughtfully over different options? Or is a last-minute she'll-be-right gift grab more likely?
For the last two Christmases, I've changed the way I give gifts to my family... I don't buy them anything!
That's right - no parcels, no wrapping paper, no ribbons, no bows. Before you gasp "How inconsiderate!" let me explain.
For the last two years, I have treated them all to an experience! The first time was a delicious lunch for everyone at a local cafe and we've just returned from a nearby holiday destination where I'd booked a house for the weekend.
Did these ideas cost more than individual presents? Nope. Were they a great way to spend time together as a family? Yup!
Are they likely to be remembered longer than the latest toy, book or voucher? You bet!
Don't let Christmas 'tradition' trap you into ordinary, everyday presents. Put some creativity into your shopping list.
"You may give gifts without caring - but you can't care without giving."
Frank A. Clark
How Much?! (Mar/Apr 05)
The Maldives are a four-hour flight from Singapore and I arrived at 10pm. Not only was it very hot, it was also pitch black.
The airport is on a small island separate from Male (the capital city; pronounced Mar-lay), and my friend had forgotten to come meet me. <vulnerable feeling #1>
The helpful chaps at the information booth couldn't get through by telephone, so they pointed me in the direction of the ferries to Male.
I followed the crowd and trusted my instincts, hopping onto a crowded boat for the 15 minutes journey. But I had no local currency... <vulnerable feeling #2>
Thankfully the ferry folk accept US dollars (though they know which way to slant the exchange rate!), so I was allowed to disembark. Immediately I was bombarded by enthusiastic drivers: "you want ride?" - all looking remarkably like family cars with a basic stencil of 'Taxi' on the side. <vulnerable feeling #3>
Deep breath, lucky dip, hopped in and showed the driver the piece of paper with my friend's address on. With gusto we're off, whizzing through the insanely narrow streets, barely avoiding the dozens of strolling pedestrians and suicidal scooter riders.
Then the driver radios his boss in a language unlike any other, but I can tell he's asking for directions! <vulnerable feeling #4, big time>
So it's dark, the route we're taking is making me dizzy and I don't speak the language. I want my mummy!
Suddenly we turn a corner and the driver pulls over as far as he can, allowing traffic to squeeze past. He points to a tiny door, which does actually display a word that's on my bit of paper! <relieved feeling #1>
But then he asks for "20". I stare at him as only the jet-lagged can - how can he justify US$20 for a five-minute journey? Is he crazy?
Ohhhhh... he means 20 Rufiyaa, the local currency (about US$2). I pay up, climb several flights of stairs and find my friend at home. <enormous relieved feeling>
These are experiences that money can't buy - you wouldn't find them on a packaged tour. But looking back I wouldn't have argued paying US$20 for finding the right apartment!
What priceless adventures have you had lately?
"Things will probably come out all right, but sometimes it takes strong nerves just to watch."
Hedley Donovan
It's Too Expensive! (Jun 05)
"It's too expensive!"
I've heard this exclamation a couple of times lately in relation to a Scouting event this coming January (I'm leading a contingent of 40 Kiwi teenagers to Sydney for the 2006 Australian Venture).
Let me see... 13 days offshore, flights, accommodation, transport, meals, awesome activities, and the chance to mix and mingle with around 1000 other teenagers from around the globe.
Now for some people the required $2000 (approx, depending on activities) is a lot of money. When you don't have a lot to start with, any amount can be too much!
But the amount itself is neutral - it's neither cheap nor expensive, it's just a dollar sign followed by some digits, to be exchanged for some experiences and memories. We give it the emotion ourselves - and that's a good thing, because we can choose what emotion to give it.
Using the sentence "It's too expensive" implies we have no choice in the matter, that the decision to attend is blocked by the large fee involved. Rubbish!
What we are really saying is either "I don't currently have enough money to pay for that" or "I choose to spend the money I do have on other things".
Just like "I can't afford that", saying "It's too expensive" blocks our creativity and traps us in the cycle of "Poor me, it's not fair! Why can't I afford to go?". Instead, by asking "How can I afford it? How could I fundraise the money? What can I do to create some extra dollars?" our creative juices are encouraged to flow, and positive action can follow.
What blocking words are you using to describe neutral events? Do any of these sound familiar...?
"I don't have time to exercise" (Don't you mean you choose to do other things with the 24 hours you've got?).
"I find it really hard to get up in the morning" (Which indicates you don't have a compelling enough reason to get out of bed. Are you living, or surviving? What would catapult you from the pillow with a smile?).
"My kids - or partner, or pet, or boss - make me so mad!" (Wrong - you choose to feel mad in response to their actions. What constructive action could you choose instead? Counting to ten, using more effective communication, trying to understand their perspective...?)
Become free from your self-imposed brain-washing. Monitor what words you use to describe your situation. Then take control and design your way through it!
"Only a fool thinks price and value are the same."
Antonio Machado
Drawing Deep (Dec 05)
What Christmas gift can't be bought, made, wrapped, put on hold or found in the Boxing Day sale bins?
What gift can't even be given to someone else?
A breath.
When did you last give any thought to your breath? You can't save it or stockpile it. It anchors you in the present moment. Are you breathing deep and well?
Stand tall, head high, shoulders back and give yourself the ultimate free Christmas present... a lung-stretching, life-giving breath.
Enjoy.
"The best things in life are nearest: breath in your nostrils, light in your eyes, flowers at your feet, duties at your hand, the path of right just before you."
Robert Louis Stevenson
A Question of Tax (Mar/Apr 06)
Everyone has a different idea about money... and especially when it comes to taxation.
I came across this story recently. The author is unknown and part urban legend! Being American the percentages may be different from yours, but the principle remains.
I'm sure if you share it with your friends and family, it will lead to an interesting discussion on "what is fair?".
--//--
Where’s My Tax Cut?
Suppose that every day, ten men go out for dinner and the bill comes to $100. Suppose too, that they decide to pay the bill the way we pay our taxes. This is what happens:
The first four men (the poorest) pay nothing.
The fifth pays $1.
The sixth pays $3.
The seventh pays $7.
The eighth pays $12.
The ninth pays $18.
The tenth
man (the richest) pays $59.
The ten men are happy with the arrangement. But then one day the owner
throws them a curve.
"Since you are all such good customers," he says, "I'm going to reduce the cost of your daily meal by $20." Dinner for the ten now costs just $80.
The group still wants to pay their bill the way we pay our taxes, so the first four men are unaffected. They still eat for free. But what about the other six men – the paying customers? How do they divide the $20 windfall so that everyone gets his ‘fair share’?
They realise that $20 divided by six is $3.33. But if they subtract that amount from everybody's share, the fifth man and the sixth man would end up being paid to eat their meals!
So the restaurant owner suggests that it would be fair to reduce each man's bill by roughly the same amount, and he proceeds to work out the amount each one should pay. And so:
The fifth man, like the first four, now pays nothing (a 100% saving).
The sixth now pays $2 instead of $3 (a 33% saving)
The seventh now pays $5 instead of $7 (a 28% saving)
The eighth now pays $9 instead of $12 (a 25% saving)
The ninth now pays $14 instead of $18 (a 22% saving)
The tenth now pays $50 instead of $59 (a 15% saving)
All six of these men are now better off than they were before. And the other four continue to eat for free. But once outside the restaurant, the men began to compare their savings.
"I only got a dollar out of the $20," declares the sixth man. He points to the tenth man, "But he got $9!"
"Yeah,
that's right," exclaims the fifth man. "I only saved a dollar,
"That's true!" shouts the seventh man. "Why should he get $9 back when I get only $2? The wealthy get all the breaks!"
"Wait a minute!" the first four men yell in unison. "We didn't get anything at all. This system exploits the poor!"
The nine men surround the tenth and beat him up.
The next night, the tenth man doesn’t show up for dinner, so the nine sit down and eat without him. But when it comes time to pay the bill, they make a disturbing discovery. They don’t have enough money between all of them to cover even half of the bill.
And that, boys and girls, journalists and college professors, is how the tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may stop showing up.
In fact, they might start eating overseas, where the atmosphere is somewhat friendlier.
--//--
Hmmm…
"Real charity doesn't care if it's tax-deductible or not."
Dan Bennett
Toss That Coin! (Jul/Aug 06)
This month New Zealand changed some of its currency - the 10, 20 and 50 cent coins reduced in size and weight (the 10 even changed colour!) and the 5 cent piece went out of circulation altogether.
As to be expected, this caused a bit of confusion, frustration (and sometimes merriment!) as people got their head around the change. Merchants raced to ensure vending machines, parking meters and phone boxes were all updated.
This was a situation that individually people could do nothing about. The treasury department devised the plan and implemented it, for the common good of everyone. Much like the weather, it was outside the direct control of Joe (or Jane) Public.
Yet - just like the weather - some people dug their heels in and were determined to not enjoy the change-over process. You know the folk... if it's a cold day they're wishing the sun was out, if it's a hot day they explain how they don't like to sweat.
What difference would it make if they put that same energy towards something they could affect?
The quote below sat above the door to my watch-house at Outward Bound, and was a nice reminder when I didn't really want a cold shower. Even though I couldn't change the fact the water was cold, I still had a choice. I could have chosen to grizzle, gripe and throw a tantrum (and go smelly!), or I could choose to take a breath and have a very quick wash, getting it over and done with.
In every single situation, we have a choice... even if it is no more than the way we think about the situation itself.
Are you putting energy towards constructive choices?
"Grant me the
serenity to accept the things I cannot change, courage to change the
things I can; and wisdom to
know the difference."
Reinhold Niebuhr
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