Give yourself a rate cut!

If you were paying off this picket fence (well, the house that goes with it), you'd know your mortgage interest rate - and be sweating on every Reserve Bank announcement. Why not take your credit card debt that seriously?

All this hoo-ha about the banks not passing on interest rate cuts to home lenders! What about credit card holders? When was the last time your provider got in touch and said, you know what, we're going to REDUCE your interest - I'd imagine never, not even by the lousy 0.1 per cent some of the banks are planning to pass on from Tuesday's 0.25 per cent Reserve Bank cut.

Most mortgagees can tell you, down to the decimal point, how much interest they're paying on their home loans. They'll tell you when the last rate cut was and when the next one is expected.  Could you say the same about the interest rate on your credit card? Given that interest rates range from around nine per cent to around 20 per cent, it's an important question. 

The banks aren't going to pass on interest rate cuts to you. You need to make like the Reserve Bank and give yourself a rate cut. How? Research whether or not you've got the right card. Chances are that you could be paying less for your credit. Sure, different cards come with different features, but are you using them all, or are you just paying extra for the privilege of having them?

Start by taking a good look at your statements - the last six to 12 months worth - and working out exactly how you're using your card. Then get on to canstar.com.au to find the best possible card for your situation - at the lowest possible interest rate. Peter Arnold, a financial analyst with Canstar Cannex, was reported in today's Sun-Herald as saying that there are at least 13 cards right now offering rates below 12 per cent. If you're not paying off your card every month (and therefore paying no interest), you owe it to yourself to get one of those cards working for you. 

It won't take long and it could save you $1000s in interest.

pic: Old Malvern Pickets

Beating stress on a budget

I know that it goes against the Stress-ista ethos, but I'm stressed. Tired. Rundown. Overworked. Underpaid. All the classic symptoms. I'm also struggling with the notion that I need to take time out from work (eek! the world will surely end if I'm not slaving away at my desk) at a time when work is hard to come by.

What to do, what to do?

In frugal times, it's difficult to justify the lazy $60-$100 required for a massage or a facial (particularly in light of this NY Times story that questions their relevance at all), but the fact is that you need to recharge to stay on top of your game. Overstress leads to poor performance which leads to more stress which leads to... well, you get the idea.

If touch therapy is what you need, why not try a student massage? They're generally half the price, well-supervised, and, let's face it, a vast improvement over letting the kinks in your shoulders grow to gigantic proportions. In Sydney, you'll find one through NSW School of Massage or Nature Care College - find one near you by Googling 'student massage' (taking care to avoid the obvious porn sites).

If you're addicted to facials, beauty colleges often offer a student version, or you could throw yourself in a rose-scented bath, slather on a mask, and read a book for half an hour (far preferable to me than inane chatter about my weekend with a beauty therapist).

Other free stress-relieving options include taking a few deep breaths, walking around the block a few times, or getting someone you love (or would love to love) to give you a hug. Cuddling releases the hormone oxytocin into your nervous system, making you feel soothed and safe.

Once you're all calm and focussed again, it might be time to consider some Income Protection Insurance. There's nothing more stressful than discovering that you suddenly can't work for a while - due to illness or accident.

Take a load off your mind and consider your options at www.lifebroker.com.au

Pic: HelpGuide

Leftovers are the new takeaway

The GFC, in all its glory, has coincided for me with a move to a simpler life on the south coast of NSW. Not only does this bring forth previously suppressed desires to grow my own vegies (still in the planning stages) but it also brings a dearth of home delivery options. From a funky inner-west bastion of Thai, Vietnamese, Greek, Lebanese, Italian et al cheap eateries, I have been reduced to multinational pizza joints, multinational fast food joints, fish and chips, a whole lot of Chinese restaurants (sweet and sour anyone? and one lone Indian (pretty good, since you asked).

So I've hit the kitchen. Now if I want a night off from cooking for the family, I need to have planned (48 hours in advance) leftovers. Tasty leftovers. Leftovers that people will actually eat without turning their noses up and feigning sudden illness.

It's not easy. My new BFFs are recipe mags like Super Food Ideas and Good Taste, and you know what - they're great! Easy, tasty meals that don't require a list of gourmet ingredients as long as my arm. I'm in love. But not as much as I love taste.com.au, the online archive of these two mags and three more besides.

We're saving heaps of money, too. I fed four of us for $107 last week. Breakfast, lunch and dinner. I know that there are people who can do it for less (possibly the same people who save their soap scraps to make new bars), but it used to cost me closer to $200 and we'd have takeaway two nights a week on top of that.

Need help with your budget? I reckon you could do worse than starting with a shopping list. Plan your meals like Nanna used to. Turns out that old-fashioned is the way forward.

Pic: taste.com.au

HOUSEHOLD BUDGETS: why bother?

In an age of credit cards, ATMs and redraw mortgages, the idea of creating a simple household budget has gone the way of the dinosaur – it seems as antiquated as an apron-wearing housewife stashing housekeeping money in the teapot for a rainy day.

Taking charge of the dollars and cents of everyday living expenses is the simplest path to financial security. One thing that will make you wealthy is spending LESS than you earn and the simplest way to do that is to budget.

“A lot of people are scared of budgets,” says Cath Armstrong, Cheapskates.com.au founder and author of Debt Free, Cashed Up and Laughing. “It’s just a piece of paper with some numbers written down. It can’t bite you, even if it does terrify you.”

Budgets are nothing more than a plan or guide to household spending. They are not a tool for punishment, deprivation or misery. “Budgets are about making sure what comes in is more than what goes out – once you’ve done that, it’s easy, people will wonder why they didn’t do it sooner,” Armstrong says.

The benefits of creating a household budget include:

· knowing exactly where your money is going;

· eliminating silly spending so there is more money for shopping, treats or even investments;

· less stress when the bills and credit card statements come in;

· creating a tool to help focus on long term financial goals.

Go on, it's not that hard is it? Do you use a budget or prefer to fly by the financial seat of your pants?

Pictures: KateSpade

Coming soon (free) to your wardrobe?

Just think, in a season or two, this new look from the Paul & Joe spring 2009 RTW collection might be coming to you free via swapstyle.com.

Diane von Furstenberg, Coach, Chanel, Gucci, Christian Dior, Christian Louboutin… If I told you all these labels – and heaps more – were available in one place, you’d be excited. Once I added the fact that they’re also free, you’d possibly hit the stratosphere.

Swapstyle.com is like one big night in the wardrobes of the women of the world. Or the swapstyle.com members at least. They upload pics of stuff they don’t anymore, along with a ‘wishlist’ of items they’re willing to trade it for. Hautemamascloset (user name), for instance, has a Paul & Joe silk dress (not pictured) that she’s willing to swap for a designer handbag from Coach, Chloe or LV, or “anything from Lilli Pulitzer”.

So what are the hitches? The site is designed for swapping, selling or buying – so some items have a price tag (though there are a lot of ‘swap’ items to be had). It costs $10 to become ‘address verified’, which is a security feature of the site (they recommend dealing with other swappers who’ve been through the process). Oh, and you’ll need to factor in postage for that Paul & Joe dress, for instance – hautemamascloset is in the States.

For fashionistas struck down by the recessionista bug, it’s a fun few hours window shopping if nothing else.

Pic: nymag.com

Making It Happen

Ever wondered how you get yourself into a financial mess? Dr Paul Harrison, marketing guru and academic-who-speaks-in-normal-language* from Deakin University, has created a short film about the traps for young (and old) players called 'Making It Happen'. The characters are fictional, but the script is based on real stories by consumers. Check out this trailer, and keep an eye out for the film coming to a short film comp near you.

*Disclosure: Dr Harrison is my go-to guy for consumer stuff. He did some cracking research for the Consumer Action Law Centre about why we think those 'Congratulations: You're Pre-Approved for a Credit Limit increase' letters are such a good idea (and why they're actually not) - you can read more about it in Credit Card Stressbusters.

Getting the gold: How to give up shopping

Shopping sounds innocent enough, but it can cause a personal sub-prime crisis, complete with credit card debt and a need for a new fiscal stimulus package.

TV marketing executive and author Neradine Tisaj has literally written the book about it after realising credit card debt and a good chunk of her spare time was devoted to overindulging in retail therapy.

“We all have a void that niggles at us and shopping is one of those ways of nurturing ourselves that isn’t in fact nurturing at all,” the author of How To Give Up Shopping (Or At Least Cut Down) explains.

“In June last year, Australian’s spent 12 per cent of their income in credit card interest so there is no doubt at least some of us are over-shopping – I wasn’t the only one.”

Tisaj’s frustration prompted her to seek out financial advisers, none of whom understood her problem. One told her to stay home more and eat eggs.

“Telling a shopper to stop spending is like telling a fat person to stop eating – it shows no understanding of the problem,” she says.

“For lots of people, shopping is a hobby. It’s their entertainment. I personally loved department stores. For me, riding up the escalator to look at homewares, frocks, shoes and try perfume was the ultimate pastime.”

Committing to a conscious spending regime was the only way out for Tisaj, who now buys “80 per cent less” than she used to.

“If you want to start consciously shopping, you have no choice but to go Cold Turkey,” she says, explaining that overshoppers should go on a month-long shopping detox buying only food and necessities and carrying around a notebook to record any feelings and spending.

“Once you’ve gone Cold Turkey, you realise what you miss and you can allocate a sensible budget to purchase what you really love,” she says. “For me, it was books. So even though I went to the library, I still wanted to buy them.”

And the other trick? Place a list of 20 things you love doing that are inexpensive in your purse – ideally where the credit card used to be.

“When you feel like a splurge, just get out the list and do something else.”

Pictures Minaret Vintage Jewelry via Flickr

Save face AND cash: cheap recommended beauty buys

All this fuss about Olay's new Regenerist Micro-Sculpting cream (and don't tell me you haven't seen the ads) got me to thinking about how much we pay for beauty products - and how much we need to pay. Hope in a bottle generally doesn't come cheap, but sometimes we overlook really good products because they don't cost a bomb.

But I'm no expert at the beauty counter, so I got in touch with Katrina Lawrence at beautyeditor.com.au for her thoughts on the subject. Here's a sample of her list on where you can save - and where you really should spend - when it comes to beauty products (for more, go here).

Save:

*Cleanser: Cetaphil Gentle Skin Cleanser is worth the hype.

*Acne products: Neutrogena offers some of the best skin-clearing products around, not to mention the most affordable.

*Moisturiser: Head straight for Nivea. The Oxygen Power Reviving Day Cream is a standout.

*Hair care: Don't go past Tresemme.

*Tanner: Palmer's Natural Bronze Tanning Moisturiser beats most big-priced tanners hands down.

*Makeup: Maybelline is not just a maybe.

Spend:

Don't scrimp on anti-ageing products, foundation or hair colour (if you're planning to go lighter.)

It's a given that any budget requires sacrifice and prioritising. But savings in the beauty area are looking good, without sacrificing your good looks.

Pictures: bellamumma

Make your mobile phone pay its way

Sienna Miller ... who's paying her mobile bills?

Inertia is the enemy! Rise up, ye mobile phone users! Don’t overpay that mobile phone bill again! Discover the cheapest possible phone plan for your needs!

“It’s too much of a hassle for most people,” explains Phonechoice.com.au founder Doug Purdie. “They simply pay the bill and don’t think about it much.”

Phonechoice.com.au estimates most of us can save at least $100 a year by aligning our mobile phone calling patterns with one of the thousands of plans available through Australia’s four mobile phone carriers.

“There are so many twists and turns to the plans but you can cut through it all by writing down on a blank piece of paper exactly what you want to use your mobile for: do you ring friends, text, surf the web, use only during peak for business?” Purdie says.

“You need to get your last three months bills and work out if the way you want to use your phone matches the way you actually DO use the phone.”

Then head to the Phonechoice website at http://www.phonechoice.com.au and enter your calling patterns into a tool that will show you the best plan and provider for your calling patterns. “Most people are not on the best deal for them,” he says.

There are three great tips Purdie offers for those wanting to lower their mobile phone costs:

1. Phone your current mobile phone provider with the information you have gleaned from the Phonechoice website. “It’s amazing what can happen by talking to your existing carrier,” he says. “That first phone call can deliver great results - they will tell you they have a capped plan or combo plan that will suit you better and maybe throw in some extras to keep your business.”

2. Save mobile costs by turning off your voice mail – if you look long and hard at your bill, most of it will be deposits and retrievals which earn the provider a motza. If you can’t bring yourself to turn off the voicemail, at least extend the ring time before it switches the message on.

3. If you’re near a landline, use it. “People seem to forget that you don’t need to use a mobile every time you call someone.”

Pictures: The Sun

The forgotten secret of financial savviness

In the story I wrote in this month's Madison magazine, I outlined the 10 biggest mistakes we make with our credit cards.

Well, guess what? I forgot one (plus, let's face it, 11 is just not as nice and round a number as 10).

So, in the interests of sharing information and giving added value, here's number 11.

11. WE FAIL TO FILE

It sounds so innocuous when you see it written like that, doesn't it?

The fact is that if you keep tabs on your financial information - so that you can actually put your hand on something when you need it - you're halfway there to keeping on top of your finances.

Think about it: no more late fees because you 'forgot', no more missed opportunities because you 'threw them out'. Lissanne Oliver - check out her blog - is the Australian queen of organisation, and she reckons that getting your financial, um, stuff together puts you in the driver's seat.
Here are five basic steps to get you started:

1. Put everything related to your finances in one place - even if it's a shoebox.

2. Open your mail over the bin - if you don't need it, don't keep it.

3. Don't take every receipt you're offered - those three apples from the fruit shop are probably not tax deductible.

4. Cull. Understand how long you need to keep things (five years for tax records, for instance) and once that time has passed, get rid of them!

5. Deal with your financial stuff regularly - get it out once a month and look it over. The more often you do it, the less arduous it is.

Simple stuff, but very powerful...

For more about organising your finances, check out this story I wrote for Ninemsn's Money website.

Credit cards: Back away from the microwave

Saving may be the new black and money the focus of every women's mag on the shelves this month, but the fact is that your will to stop spending is sometimes not as strong as your urge to splurge. And a credit card is what's known as an 'enabler' in this situation.

So, what to do? The trick is to put some distance between you and the card. You could try the old credit card in the freezer trick - but you only need to see the trailer for Isla Fisher's new film 'Confessions of a Shopaholic' to see how ineffective that can be. It only takes a large hammer and a few stress points and you're away.

At least she didn't try to microwave the card: there's more than one sheepish credit card addict out there who's discovered that the quickest way to render a card useless is to try to defrost it in the microwave.

You could give your card to Dad/older (grumpy) sister/disapproving boyfriend, forcing you to weigh up the benefits of the purchase versus your loss of pride. You could simply leave the card at home when you shop, assuming the long and difficult journey back to your place puts paid to impulse buys.

Or you could, gasp, cut the damn thing up until you've paid it off.

The only way to make serious inroads into credit card debt is not to use the card. Cut it up and your problem is solved...Unless, of course, you work out you can still use the number to shop online.

But that's a whole different story.

An interesting thought: all that glisters could compound

Albert Einstein is quoted as saying 'the most powerful force in the Universe is compound interest'. Yes folks, compound interest has more effect on your life than a poorly groomed beard (see below - that's Gwyneth with the formerly handsome Joaquin Phoenix).

Question is, is it working against you?

Compound interest is interest on your interest. If you borrow $1000 on your credit card, you pay interest on that - say 15 per cent. Every month, you pay 0.15 of not only the $1000, but the interest accrued the month before. At the end of the year, you'll owe $1347.35, assuming you've made no payments over the year.

The key to winning against credit card debt is paying off as much as you can every month. The minimum repayment is not enough to make inroads (unless you have about 11 years to pay off $1000, but that's another story).

Take a stand. Don't let the force win! Or you could end up looking like Joaquin Phoenix ... who used to look like the picture below.

Pictures: GoFugYourself and GreenFrogStudio

GOING FOR GOAL: how to always get what you want

Freida Pinto went from slumdog in that fabbo movie Slumdog Millionaire ...

Working towards a financial goal sounds about as much fun as doing a tax return. DULL. But creating money goals helps you envision the future you really want, detail the resources and time you need to make it happen ... and squeeze in all that glorious lifestyle no-one wants to miss out on.

Creating a financial goal is all about deciding what you want - which can actually be half the battle. Most of us spend our time thinking we want stuff but let our finances go haywire instead of implementing plans to make sure all the lovely things we've been dreaming of actually happen.

... to glamour girl who gets the guy. It's GOAL, GOAL, GOAL!

How To Go For Goal:

1. Waddaya want?
   Start thinking big and write down everything you want. Easy peasy. Now it gets harder because you have to work out how long you think it will take to achieve them. Place goals that can be accomplished in under six months under Short-Term, goals that can be accomplished in six months to a year under Medium-Term and goals that will take more than a year to accomplish under Long Term.

2. What's it worth?
   How much money will it take to reach each goal? Create an estimate, and write the resulting figure under a new Estimated Cost category. Now write down what it's really worth to you. What will each goal bring to your life, lifestyle, loves and dreams.
   

3. Set a target date.
   When do you hope or need to meet your goals? Set a target date for each goal on your list, and use this as your deadline to meet or beat.

4. What's the wish tax?
   Divide the estimated cost of your first goal by the number of weeks until your target date. This shows how much money you need to save each week- also called The Wish Tax. Enter the resulting figure in a"My Wishes" column, and repeat for all of the other goals that you've listed.

Be realistic about how much time and money it will take to accomplish each goal – an estimate that is too low will only frustrate you. Keep your motivation by revisiting your list frequently. Next time you're tempted to splurge on a non-wish-list item, get out the list for revision purposes.

SO WHAT'S ON YOUR GOAL WISHLIST?

STRESS-ISTA SAYS ... Let There Be Air

Clean or vacuum that air-conditioner filter to help it operate more efficiently – it will reduce the energy costs and spew forth cleaner, cooler air. Or maybe open the house up to fresh air instead?

Pictures: Karen Walker paints for Resene, pictures styled by Katie Lockhart

HOUSEHOLD BUDGETS: 3 tracking points

The idea of budgeting is scary - imagine limiting your spending? EEEEEEK! But there's a simple way to make a budget easy and work for you. And that's to create the budget tailormade to your spending habits, wishes and wants. It's only a piece of paper with a financial plan attached, nothing scarier than that!

So a budget works best if you understand how and what you spend, and why you spend.Just like Weight Watchers asks dieters to track food consumption, all good budgetters should note how and when they spend every single dollar. Try this:

1. Carry that notebook
Taking notes of how you spend, why you spend and how much you spend feels like hard work but will generate amazing insights. How many of us have had a $50 note that just seems to disappear? Tracking your spending is the best way to find out where it went. Keep track of every packet of chewing gum you buy or Diet Coke you splurge on all day, every day for a month. If you really hate the idea of carrying a notebook, try tracking on your computer with this neat trick.

2. Start taking note of yourself
Tracking helps you work out how much you're really spending (most of us underestimate and just wonder where the money went). The other bonus is that writing something down makes you conscious of what sort of mood, events and emotions are going on that might trigger certain purchases. A month of writing things down purchases seem rational and which are emotional.

3. Assess what you really spend day-to-day
At the end of your tracking period, work out what you spend in a week and times that by 52 and divide by 12 to get an accurate monthly average of your day-to-day cash spending. This becomes an invaluable planning tool to get a handle on your spending, budgeting and financial goals.

Pictures: Polyvore