Things are Changing Around Here in 2024

 

The Internet is becoming more and more of an abyss, what with social media blurring the edges of every website we visit and an assumption that everyone has fabulously fast broadband and mobile phones that can juggle a thousand photos, videos and applications. Sadly, this is not the case for everyone. Some of us live within the small percentage of UK to where such luxuries have not yet arrived. Blogging seems to have become obscured by vlogging and while viewer numbers on our own YouTube channel reflect no need for it to be there, it is still something that I want to do, There are no frills attached, not even voiceovers, just tiny fragments of videos that give our viewers the opportunity to see what we see while we are here. Getting the word out about anything is beyond affordability to the likes of us, despite taking part in local wildlife events and such like.

So here we are, trying to get back into blogging but now from the off-grid huts that sit amidst the wilderness that is Frugaldom. I am relying on an inexpensive 100w solar panel connected to a secondhand leisure battery to power the laptop and I access the internet by tethering the laptop to a mobile phone. This only work if I perch the phone on the edge of the camping stove. Granted, the view from the office window is fabulous on a clear day - fields, forest, Vincent Van Goat calling from his enclosure, rescue ponies frolicking around their track in whatever the weather and all against the backdrop of the Galloway Hills. Not bad, in my book. But that doesn't pay the bills nor does it put food on the table, feed in the buckets or hay in the nets.

AIRES AND SPACES

At just £5 for an overnight stop and a licence that allows for up to five campervans at a time, we have the potential to generate some income. Our yard is fairly level, secluded, enclosed and secure but lends itself better to hosting three motorhomes up to 7.5m so that is the number I am working with for now. We are off the beaten track bu only 4 miles from the main A75, depending on which route you take. We are not on a through road, nor even on a road to anywhere other than a wind farm and forest so only the farmer, forestry folks and windfarm maintenance people pass our gate, plus a few dog walkers who drive their dogs up to the windfarm. Again, this does not lend itself to overnight stops, especially as all around us are alernatives to paying for parking. But wait... could there be a small percentage of campervanners who may just be looking for a safe, secure hideaway to escape the norm? Or might there be the occasional individuals looking to pay £25 per night to have the yard to themselves? Even better!

With 5 spaces at £5 per space, our yard has the potential to generate an absolute maximum aire income of  £9,125 (less transaction fees) per year, but the reality is far different from that. Based on 3 campervans, the income potential is £5,475. Again, the reality is far from actual turnover as the possibulity of having 3 campers in every day of the year is just fantasy. Where we are right now, we are lucky to see an average 1 campervan a month. No point glossing over this fact. I am forever reading comments on socal media about how so many want to pay so little for so much and this is one of the reasons I feel we should move on from offering secure parking and look at alternatives. We are a very quirky project, not your normal run-of-the-mill campsite. We are an aire - a term I had never encountered before opening our yard to the land of campervanners and motorhomers. Indeed, I have never spent a night in either - my preference is hutting in the countryside, surrounded by famiiar landscapes and our regular visits from the badgers, pine marten, fox and yes, even the adders, when the sun decides to shine. 

We accept PayPal payments to Frugaldom either direct via the QR code posted at the gate or by email to frugaldom@gmail.com but we also use honesty and donation boxes for those who prefer to pay cash. On occasion, we will barter for goods, services or a little bit of help from visiting campervanners. It all helps when running a voluntary project with no regular source of income generation on site. So what is our niche?

HUTS AND WILDLIFE

Most nights, we are visited by pine marten, badgers and fox. As members of our regular support group, which costs from as little as £5 per month, you can visit anytime and watch for the wildlife. 

Bring some peanuts and you're sure to attract some animal attention, even if it is just a visit from Vincent Van Goat, who is one of our rescued residents living at the Frugaldom sanctuary.

We are special, we are quirky, we are affordable, we are niche, we are at Frugaldom. We will hold the ampervan aire open until the end of the year then assess the situation from there.

50 is the New 30

What are you doing to prepare for retirement when 50 has been deemed the new 30?

Not so long ago, the old age pension began at 55 for women but has gradually been pushed back to 67 for our age group – fast approaching 50 – but do you feel old?

50 is the New 30 … read more

Clearing Your Debts - Where to Start

We might be broke but we shouldn’t be broken!

What is best for you and your money? Is it a self-imposed debt repayment challenge or would, perhaps, employing the services of a debt consolidation expert help you more?

… In my opinion, the best place to start with clearing debts is to understand how you got into debt in the first place and take a long, painful look at exactly how much debt you have accrued. This is where many fail to get out the starting gate, as the full realisation is one filled with such horror that the 'head in the sand' approach seems the easiest option. Easy it may be, but pain free it is not. For every day debt it is ignored, that debt can grow. Much better to stop it now and send it marching back to wherever it came from in the first place. Better late than never, as they say…

… Only by seeing, understanding and accepting your own financial state of affairs can you take charge of the situation and begin bringing it all under control.

Full article can be read here - Clearing Your Debts - Where to Start

The Frugal Route out of Debt (Part 2)

Working Out Your Own Budget

(Part 1 can be found HERE)
Once you have estimated the amount of money you have coming into your household and have deducted everything that needs to be paid to sustain your accommodation, protect your income and get you to work on time, whatever is left is you basic household budget.

It costs money to be in fulltime employment. You could have expenses such as travel, childcare, lunches, workwear and additional grocery costs if your working hours inhibit you, timewise, from cooking and keeping up with the running of a busy household. All of these things eat into your income, so don't forget about counting up all those costs - it costs you to work.

Whatever you have left, after paying for your work-related costs and the actual roof over your head, be it rented or mortgaged, is what you have remaining to pay everything else. I count Council Tax as being part of keeping the roof over your head.

This is an example list of items that may need to be paid from the household budget:

Groceries
Toiletries
Cleaning products
Electricity
Heating (coal, logs, gas, oil etc)
Internet
Telephone
Mobile phone
Television licence
Shoes
Clothes
Gifts for others
Membership fees
Car
Insurances
Pets

In addition to the above, you might also have luxury expenses like:

Satellite television
Socialising
Entertaining
Hair styling
Makeup
Beauty therapy
Gym
Hobbies
Tobacco products
Alcohol
Travel & holidays
etc, etc, etc

Separating the needs from the wants, or the necessities from the luxuries, is what has to be done until such times as you are standing on your own feet financially. As long as you have debts of any description, your household is not financially independent. Even a mortgage is debt, although many overlook this fact. (You can't simply stop paying a mortgage and expect to keep the house, can you?)

So, this gives you an idea of where your money goes, after you have calculated how much of the stuff you actually have.

Step 1 - Work out your true budget

Step 2 - Work on those figures until you have a plan showing that you can afford to pay for everything from that amount. It's what's know as living within your means

Step 3 - Have some sort of contingency plan that will help counteract any sudden loss of income, especially if you have debt of any description. Clearing the debt is the obvious choice before any sort of savings pot can be afforded. Even saving loose change in a pot should be avoided, as every spare penny should be thrown at debts until they are gone. However, for the sake of sanity, some people prefer to save something, somewhere and there's no getting away from that fact.

As you have seen from Part 1, the magical figure of £4,000 or thereabouts keeps springing up, hence the reason I have always based these challenges on that figure. To this day, I still use the same figure and I still run my personal challenge as 'Living on £4,000 for the year'. This, I can tell you, would be far easier if I lived in a less rural area.

According to the www.minimumincome.org.uk website, as linked to the Joseph Rowntree Foundation, I need to earn £320.83 per week to lead what is perceived as a normal lifestyle. Well... you all know what I think of that! The suggestion that I should be spending £50.11 weekly on food alone had me laughing myself to sleep last night. (My average spend is less than £10 per person despite not having easy access to supermarkets.)

In conclusion, I can say never trust figures you read or hear from third parties unless they are calculated using your personal figures.

Year 1 of your new challenge to follow some frugal living techniques will always be the most difficult.

Having worked out what you think your budget should be, you now need to keep records and receipts for all spends, so you can compare these after the first year to the figures you had estimated.

Spreadsheets are great for this purpose, as you can input all your figures and calculate spends as the days, weeks and months progress. If you spot an overspend in one category, it allows you to reassess your figures and make some cuts elsewhere to cover those additional costs incurred.

Get a very basic free spreadsheet from our 'handy links' section in the frugal forums, or just ask in the members' daily thread, where someone will be able to point you in the right direction.

If you don't have any software for reading or working in spreadsheets, you can download the Open Office free suite of programmes, also listed in our handy links page.

Remember, every penny or pound spent has an overall effect on your entire budget, so it needs constant attention to keep it within its limits.

Join us in Frugaldom, take part in our challenges and see how quickly you can clear debts and pursue the route to a good life. It really is that simple and it can even be fun.

NYK in Frugaldom.
 

The Frugal Route out of Debt (Part 1)

The Road to Debt Freedom

Long and boring? Perhaps

 

Full of personal opinions you may not like? Most Likely!

 

A pack of lies? No, just an honest look at some spending habits.

 

The problem with debt doesn't lie in how little money you earn, it lies in how you spend that money. Never having been in a household that has cleared £20,000 a year, I cannot begin to imagine what it must be like to have two fulltime salaries coming in, not even basing them on today's phenomenal (to me) minimum wage. In absolute honesty, the current minimum hourly rate has been close to the highest hourly rate I have ever earned as an employee. (That's probably more a reflection of my age than anything else.)

 

So, here goes for a rollercoaster ride that can take you out of debt and into what many in modern society think is poverty - how weird is that and how deluded are they? I call it a good life!Poverty, to me, suggests starvation and deprivation with no escape!

 

GETTING OUT OF DEBT ONCE AND FOR ALL - SOME SIMPLE CHOICES

1. Stop spending on anything that is not needed. 
2. Pour a cuppa and sit down with a notebook and pen, then count up exactly what you have coming in each week/month/year
3. Count up every penny you are spending each week/month/year
4. Take a deep breath and pour another cuppa
5. Make a start on a statement of your financial affairs.
6. Set yourself a budget and stick to it
7. Let your bank/building society/creditors know your full financial situation if there are any arrears involved 
8. Liquidate any assets you may have that could pay off any arrears. Declutter and sell your surplus, for example.
9. Start tackling the debts, highest interest rates are best to be cleared first.
10. If it makes you feel better (keeps you sane), clear off the smallest debt as soon as you possibly can so you can experience achievement as quickly as possible. 

Be realistic about your situation.  Be honest in setting your priorities and talking with your creditors.
Be kind to yourself, you are where you are, so there is no point in beating yourself up over it. (Thanks for this addition, Tad)

 

You have now made a good start by looking at the possibility of calling a halt to more debt and turning your situation around once and for all.

 

Now we will take a closer look at these simple steps, starting with number 1 - stop spending on anything that is not needed.

 

Basically, this means call a halt to everything, even if it's only for an hour to take the time to assess the situation. Determining your needs from your wants is a massive step to take for some, so the easiest way to do this is to look at everything you have bought or spent on since your last payday. Needs are the absolute basics to sustaining life itself - food, warmth, shelter, essential medications. Make a list, it's good to look back at it now and again to see how life changes on an almost daily basis without your noticing.

 

Now try to list everything else, and I do mean absolutely everything, right down to how many miles you drove and every bill payment, debt repayment, bank charge and interest charge. I know, it's already getting scary just thinking about it, let alone looking at the figure on the paper or screen in front of you, so here are a couple of examples from previous years. We all need to start somewhere and, in the beginning, we all make mistakes. But we all need to set our own budget and stick to it.

 

WHAT  IS A BUDGET?

 

In very simple terms, it is a calculation of all the money you expect in, from which you need to pay everything. Your overall annual household income is what your annual budget is based upon and from this, all spending must come.  Only by knowing exactly how much you are spending can you begin to take stock and calculate or estimate how much money you need to pay your way throughout the year.

For the purposes of frugal living, we are aiming to spend less than we earn at all times or, at the very least, afford to pay everything on what income we have, even if this means making some drastic changes to future spending and earning plans.

However, many people (and companies, banks and Governments) end up spending more than they actually have, which results in debt.

Here are a couple of examples from 2007 (taxes, interest rates and benefits have changed since then):

Lifestyle 1

Couple with 2 of a family, husband works full time on a salary of £30,000 and wife is a full time mother/homemaker (not sure what the politically correct term for this category is any more!) Total income is approximately £452 per week including Child Benefit.

Mortgage & Buildings insurance - £740 per month = £170 per week
Council Tax/Water - £125 per month = £24 per week
2 cars, both on HP - £300 per month = £70 week
2 x road tax, insurance, servicing, petrol/diesel etc = £270 per month = £62 week
Credit cards - £100 per month = £23 week
Loans - £100 per month = £23 week
Total expenditure before actual living expenses - £372 per week
Balance remaining = £80 for everything else
Equivalent to £4,171.00 for a full year

 

The annual household budget for lifestyle 1 is £4,171.00

Lifestyle 2

Couple with 2 of a family, husband works full time, wife part time, joint salary of £18,000 plus Child Benefit, total income approximately £300 per week

Mortgage & Buildings insurance - £303 per month = £70 week
Council Tax/Water - £100 per month = £23 week
Home Improvement loan - £266 per month = £61 week
Credit Cards - £100 per month = £23 week
Other debts - £100 per month = £23 week
Car - road tax, insurance, servicing, fuel etc - £100 per month = £23 week
Total expenditure before actual living expenses - £223
Balance remaining = £77.00 for everything else
Equivalent to £4,015.00 for a full year 

 

The annual household budget for lifestyle 2 is £4,015.00

It didn't really matter what the annual income was, there always seemed to be a significant difference in the way that income got spent. Attitude to debt differs from person to person, depending on how easy they can access it and then pay it all back.

As another example, a single professional person earning £52,000 a year may well only have a household budget of £4,000 after paying commuting costs, the mortgage and upkeep of a grander house in a more expensive area, a sportier car, regular entertaining, foreign holidays, the gym and other luxuries they think are affordable, such as beauty treatments, designer clothing, a gardener and/or cleaner.

No matter what your income bracket, we could all be in the exact same boat. Fortunately, we each have the freedom to choose how we stay afloat. The £4,000 is a figure that has stuck with me for many years and seems as relevant now as then.

No matter what you do or how you do it, you are always going to have to pay the cost of living. If you can reduce the cost of living and clear off ALL debts, then think of the fun you can have from thereon in - that is the good life.

Budget to within an inch of your life and see just how much it costs you to live. You can see by the above how I arrived at £4,000 and hopefully this will make things a little clearer for our newest readers and challengers on the www.frugalforums.co.uk, rather than having to search through years' worth of posts and pages only to find themselves in even older archives.

 

Part 2 is coming right up, so don't wander far - I hope you filled a flask rather than repeatedly boiling the kettle? :)

Edited in - Part 2 can be found HERE

Feeling Lost on the Road to Financial Freedom

Twisting and Turning - Taking the Frugal Route.

In support of a fellow frugaler and blogger. :)

This is the route I chose to take about 15 years ago. To many, it looks like it's all downhill through a rather bleak landscape, with nothing to look forward to but reaching the bottom, when things will hopefully level out and allow time to relax, go with the flow and even enjoy the ride.

It's the frugal route, it's the needs prioritising the wants, it's the saving combatting the spending and it isn't easy to navigate if you happen to take your eye off the road, even for a brief moment.

Here's the latest update on my 2012 Challenge:

The following was the rejigged (several times) budget for 2012 showing total amount followed by what's left (in brackets). This was for household of three that then dropped to two.

Groceries, Toiletries, Cleaning - £1,200.00 (-£18.59)
Electricity - £800.00 (£15) probably won't be enough, but will try to make it last.
Coal - £245.00 (15p)
Logs - £165.00 (£4.75)
Other - £64.50 (£6.25)
Mobile - £10.00 (£5) there's no signal here, so why feed the thing more than it needs?
Telephone and Internet - £318.00 (NIL)
TV - £145.50 (NIL)
Footwear and Clothing - £50.00 (-£16.07)
Gifts - £60.00 (-£69.59)
Car - £750.00 (£12.59)
Postage and Deliveries - £47.00 (-46p)
Home Insurance - £75.00 (£75)
Household Pets - £70.00 (£9.77)

Total remaining from £4,000 = £23.81

As you can see, there were a few fluctuations after switching about balances. I deducted £100 from car budget and switched it to groceries and I didn't renew contents insurance - my contents are minimal, to say the least. Gifts budget is something I need to really work on, as I am so easily tempted when it's for family. That HAS to stop and I have to make much more of an effort to handmake gifts. Trouble is, you can't handmake things like concert tickets. (Nor do I want to become that crazy old lady who gives strange creations to grandchildren for Christmases and birthdays that they hide and then only produce when granny visits!)

Clothing budget went over because I bought some leggings, hi-vizibility vests, gloves and hats for all the extra walking and cycling we'll need to do, now that the car's gone.

On the 'EEK' front - this stands for Everything Else Kitty - over the past year, I have raised an extra £1,808.80 from sales, winnings, vouchers, cashback, interest on savings and cash gifts from family. There was also a small payment from the scrappy when the car got put to sleep, plus there will be another few pounds due at end of the month from savings interest - a pittance - and, hopefully, a couple of months' worth of road tax refunded.

Over the year, I have spent £1,806.46 outside of the strict household challenge budget - pretty much spending it as I get it - but I did use the bulk of my Amazon vouchers (transferred from Topcashback* and Nectar points) for gifts, cat food and bulk buys, plus set up my new micro-business for my part in the 2013 Frugaleur Challenge. (McGonks!) I still can't thank Frugal Queen enough for her activation of that love bomb! The explosion after shock is still rippling through Frugaldom whenever the post man knocks on the door (like he did today, again)!

The EEK (Everything Else Kitty) is what pays for that little bit extra in life, so it is a very important part of any frugaler's annual budget. If I don't have it to spend and want to steer clear of all debt, then I can't spend it without earning it as extra - over and above my normal or regular income. It should be noted that my 'EEK' earnings, even when added to my regular income, still don't come anywhere close to the national minimum wage, nor even the income tax threshold, but I do still pay my self-employed National Insurance Contributions, despite falling below the threshold for those, too! That's my only current contribution towards a retirement pension!

In comparison to others, I feel rather rich on my meagre income. The house is paid, there are no debts, each penny is my own. I am choosing to forego the car, I choose to live on a tight budget while saving what I can, I houseshare with a like-minded frugaler (read that as well-trained) and I choose to live this lifestyle because it's what I enjoy doing. Many people can't accept that fact and think I should buy a car, get a 'real' job (self-employed from home apparently isn't real 'work') and then throw a heap of cash at the renovation to get it done quickly. Hmm... of those people, I'd rather have my lifestyle than their's.

So, back to the original photo at the start of this post, if downhill is what you see, then find some free wall space and prop yourself up like this to look again...

What you'll see is a meandering path that leads us safely through the rocks and hard paces of life, gently rising from the depths of debt - be it loans, credit agreements, hire purchase, credit cards, binding contracts or mortgages - to scale the heights of financial freedom.

Along the way, we'll pass all manner of exciting and beautiful things that help us achieve our goals - smooth curves, gentle slopes, some spectacular views and, if we are lucky, some fellow travelers following the same route. It's sometimes weary and sometimes precarious, but it's heading in the right direction. A few fellow travelers will be passing us on their way down, descending the fast route, spending their cash less than wisely. These are the friends we try to waylay, in the hope they may turn around and accompany us back up the winding road, rather than risk plunging over the edge or hitting rock bottom unexpectedly faster than they'd thought possible. Others will be heading in the same direction, perhaps at a different speed, either overtaking us on their way or being overtaken by us when our own speed is faster than we realised.

At the end of the day, when we look closely at the reality of this 'meandering rollercoaster', we may all be on the same path. Finding ways of feeling good about it all the time can be tough. Some days we simply need to take a break, or even backtrack a little so we can survey the lie of the land and then take a run at the next hill. On such a life changing journey, and that's what your adventure into frugal living can be, nature has provided for every creature to rest awhile and recharge. You just need to turn over any rock to see what's lurking below it, then decide which you'd rather be, or else decide why you'd rather be who you are and carry on regardless.

As a final offering, this is what some folks think of me when I'm of less than cheerful disposition, shall we say!

More than just a little nippy, or just plain 'crabbit', as we Scots normally put it. :)

Photo credit 1: Photo credit: snarl / Foter / CC BY-NC-ND
Photo credit 2: Fuschia Foot / Foter / CC BY-NC-ND
Photo credit 3: NYK Media, taken on the beach nearest to Frugaldom
* Referal link for cashback

 

 If nothing else, I hope this post makes someone, somewhere smile.

Teaching Money Matters in School - WHY?

Home Economics + Basic Arithmetic = Good Kousekeeping!


Shona Prophett gets into her stride on the state of the nation.

I've been watching the recent news and developments with regards to the petitions that are floating around the place. They are plying us with reasons to pledge our support to their cause, asking us to help bring money matters into schools as part of our basic education system. To be frank, I just don't get it!

School is a place for children learning the basics needed for their future adult lives, isn't it? These lessons are simple, they establish an elementary understanding of subjects that are important to everyone during future careers, regardless of what that career may or may not be. We can choose to listen and learn or we can tolerate these 'lessons' up until the point we have the freedom of choice to leave school and learn in another capacity - through life itself.

Some may see school simply as a place where children get sent during the day so they aren't wandering the streets with nothing better to do, biding their time until they are old enough to earn. School, like nursery, could even be seen as a place where children go so their parents can carry out activities other than childcare, like earning an income or anything else they see fit to do in the absence of their offspring.

Whatever any of us thinks of school, it is our right to have a basic education and our duty to provide similar for future generations. But it is not our duty to accept responsibility for the bad spending habits of others. We each receive a basic understanding of reading, writing and arithmetic, along with the simple concept of economics, be they home or otherwise, so common sense should prevail. But it doesn't!

Those who should know more than us have burdened this society with false beliefs that we should all be classed as equals, that we should all be able to partake of a decent meal, own designer labels, buy the most up to date gadgetry and possess all manner of luxury items. We should all be able to afford hobbies, pastimes and holidays, convenience and luxury should be readily available, en masse.

They led us to believe that we could all own our own homes and have the basic skills necessary to turn us into entrepreneurs or even just start our own businesses. But they overlooked one fundamental flaw in the plan - the fact that money is not a living entity. It cannot grow naturally, it cannot adapt to its surroundings and it cannot learn right from wrong. It is nothing more than paper, plastic and metal developed, manufactured and controlled by the chosen few who, to their disgrace, have been unable to balance the nations' books.

The concept is simple - take one pile of money, divide it be any number to whom you see fit to lend, then sit back and watch them pay dividends, by way of interest. If those payments fail, charge even more, add on penalties and drive the borrowers further into debt. Offer an array of incentives and promises of a better future, more security, better choices and the potential to feel good and then sit back, watch the borrowers borrow more and spend more, lining the pockets of the chosen few or those who chose to become one of them by sheer grit and determination. They all seem to have one thing in common - a total disregard for others when things, not surprisigly, go wrong. But there are always the 'get out' clauses of insolvency and bankruptcy!

This continual building of debt has now escalated to such a height that even they cannot fathom out an agreeable method to stopping it, let alone putting it right. Their solutions are to print more money, cut back on what they think is 'unneccessary' spending and make it even more difficult for 'normal' people to build real, reputable businesses that can grow to prosper and employ others.

They price ordinary people out of the market with legislation governing maternity pay, paternity pay, pension schemes, insurances, restricted working hours and minimum wage thresholds, then sit back and await the next emergency move.

But where do they go when all the previous options fail? They need to cast blame further and wider, so now we see the blame being laid on the children... If the youth of today and the common people had learned more, this may never have happened.

Well that is bullshit!

Those who dragged this nation to its proverbial knees were the very people who allegedly benefited from extra education. All their accumulated wealth of wisdom and expertise led us to where we are now, watching and waiting for the next global catastrophe that can quickly be assigned a few billion that adds to the amassed debt. They need huge tragedies, wars and disasters, so future generations can look back on history and point the finger of blame in any direction except that which is true. Nobody appears to have shoulders broad enough to support the burden of controlling what really cannot be controlled, so let's start again - educate the young.

To whom should we look for this teaching?

How and why are the current teaching methods allegedly failing us so badly?

Controlling a company, household or personal budget is nothing more than a combination of basic arithmetic and home economics, so why are so many people so bad at it?

Why isn't a closer look being taken at the education system itself?

Why are teachers failing to teach the basic principles of addition, subtraction, multiplication and division?

Why are parents failing to teach their children the basic skills necessary for survival in a capitalist society?

Is it not possible that some form of brainwashing has swept through our entire Western civilisation, engulfing an entire generation, and that generation is not the youth of today! Nor even is it their parents' nor their grand parents' generations.

There has always been poverty, unrest, unfair division and class differences. YES! I dare to suggest that we still live within a 'Class' system and I dare to deny the existence of this so-called 'classless society' or equality that was dreamt up by some 'numpty' who thought the only way to cast off blame from those who should have known better, would be to invite society's minions into their lifestyle of wanton greed and waste - offer them more credit, hold them down by debt, if they come out fighting, let them take the blame when it all goes wrong.

So, I guess what I am trying to say here is that, in my humble opinion, people won't learn lessons that they don't want to learn, even if it is taught in schools. Brainwashing is everywhere - it's called advertising! Unless we ignore all of that and accept that debt is caused by spending more than we have, then what gets taught in our schools matters not one jot.

It is up to us, as individuals, to challenge ourselves to live within our means and if speculative investments need to be made, have a back up plan in the event you don't quite pull it off in time.

Shona Prophett
www.shonaprophett.co.uk

How to... assess your own financial state of affairs

FRUGAL LIVING DOES NOT MEAN YOU'RE MEAN!

News abounds of potential interest rate rises, property slumps, price increases, business failures and job losses. Threats of redundancy are looming over many, unsuspecting heads. It seems to be doom and gloom wherever we look. (Unless we happen to be top bankers or trade wisely in the city.)

I read, with interest, that the resilient Brits are fighting back in the only way they know how - by acting like the proverbial Scots and tightening their grips on the purse strings. I mean no offence by this!

As a native Scot, born and bred, I like to think of myself as thrifty, even frugal to the point of no return. But this has, for many years, been perceived as meanness. It's almost as annoying as describing yourself as 'home-based' with regards to work, then a certain sector within society jumps to the conclusion that it means being sat at home sponging an 'income' from the Welfare State! It simply is not true! If it was true, I wouldn't fancy my chances for longterm financial happiness, me being a mere home-working 'Jock' and all!

Frugal living does NOT mean you're mean! It simply means that you are careful in your spending. I like to think that 'frugalers' have the intelligence to budget and have the will power to refrain from making rash money decisions that could affect their longterm financial goals.

Sadly, many don't find frugality until after they've hit the fast road downwards. Many have already been sucked into debt traps or plied with false hopes of earning fast fortunes in far from lucrative (non) investments.

There are money pits everywhere, glossed over with finery that can beguile even the most money-savvy minds. In some instances, there seems to be nothing more than a filament separating frugality from blind stupidity. So how do we tell the difference? We budget wisely. We aim for a debt free future. We plan. We experience the results and learn by those experiences.

Suggestion: calculate a well-informed estimate, don't articulate a 'guesstimate'.

Step 1:

FORGET about how much money you have coming in for a moment. Instead, sit calmly (and patiently) with your entire household and get everyone to write down every single item that they spend money on - use credit card bills, bank statements, receipts and houshold bills. Count it all up for everyone in one lump sum. If it's a weekly amount, divide it by 7 and then multiply it by 365 - use a calculator if you must. If it is monthly, just multiply it by 12.

Step 2:

THINK long and heard about how much you possibly spend on non-regular items, like car servicing, MOT, tax, holidays, gifts for family and friends, socialising, pet care, healthcare (prescriptions, dental treatments etc), entertainment, beauty products, haircuts, hobbies, cigarettes, alcohol etc, etc, etc... this list can be extensive.

Step 3:

ADD totals from steps 1 and 2 together - this can be a scary number!

Step 4:

ADD up the total household income.

Step 5:

DEDUCT the total spends from the total income - this can be an even scarier number!

If you are fortunate, you'll see how much you have left over to kickstart a sensible money plan in the event that any one of your sources of income stops. However, more often than not, this is NOT what seems to happen. More often than not, the household suddenly realises that there simply isn't enough coming in to absorb any major dip in the income.

That financial dip could be for any reason - a pregnancy, illness, redundancy, a wedding, a funeral, a house move... even a major repair bill can upset a fragile balance, leaving families unable to meet regular payments. But how can anyone foresee the future?

The simple answer is that nobody can!

Big events will occur, the cycle of birth, life, death will continue, Christmas, birthdays and anniversaries will come around every year, prices will fluctuate, jobs will come and go and life will carry on regardless. No matter who you are, how much cash or debt you may have or what you do, you ARE part of that cycle. It's the nature of life, itself, so go with the flow.

Inflation is high, interest rates are low - every penny in the bank could be losing us money. Inflation can fall, interest rates can rise, debt levels can reduce or increase accordingly. Unfortunately, we aren't living in a country where our national leaders are leading by example, not by a long chalk! As far as balancing the books is concerned, but without getting into a political debate, the current state of affairs has been with us for a long time. Truth be told, it will probably be with us for a great deal longer.

Someone knew it was coming.

Someone possibly knows that worse is still to come.

Someone might tell us that things will get better.

Someone might spin a great story, create a great diversion or distract our attention.

Whatever happens, the problem of dealing with insufficient money remains real!

Don't follow in the footsteps of the British Government, take control of your own financial destiny and act now, even if it is only one penny at a time. Protect your own assets, no matter how much or how little you might perceive them to be. Keep your friends close and, as they say, your enemies closer.

If a bank debt is costing you 10p in the pound, pay them at least 11p plus the necessary contribution to the overall balance. Get rid of it as quickly as possible.

If a credit card debt is costing you 20p in the pound, pay them at least 21p plus the necessary contribution to the overall balance. Get rid of it as soon as possible.

Learn to see clearly, so you can distinguish true needs from unrealistic wants. Don't be duped by marketing and advertising, they're merely trying to convince you that life is meaningless without the goods or services they are plying. Basically, they want your money and few care how they get it or if you can afford it.

For oodles of ideas about how to help cut costs, earn a few pounds extra or even just to make savings on your grocery budget, join us FREE in the Frugaldom Forums.

We're all here for the same reasons - to kill debt, make savings, share experiences with like-minded others and, most importantly, to ENJOY LIVING THE FRUGAL LIFE.

Yes, sacrifices need to be made, but being able to share the highs and lows of your moneysaving, debtbusting exploits is something we can all appreciate.

We're all in the same boat, but don't worry, IT'S AN ARK, and it's one that won't be going down anytime soon.

See you there, even if you're wallet's bare!

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