I’ve been piddling around for ages thinking about reigning in my spending so now its time to start doing something.  For starters, I have been through my November bank statement (being my last full month of ‘standard’ expenditure) and made a note of where all the money went.  This will now be a sort of benchmark upon which I will look to improve.  Looking at the list there are two very obvious areas to tackle – my rental property and my cash spending.  I’ve already made a commitment to tackle the rental property this month but I must also keep a better track on my cash spending – at least so I know where its all going!

I think it is easy, when trying (and usually failing!) to get a grip on spending to get a bit down on yourself about it.  After all, no matter how well things are going it is always possible to do better.  Because no-one talks about money it is easy to think that most everyone has the same sort of attitude to money and is doing the same sort of things.  However, just occasionally there will be a piece in the news or I will read something that reminds me that other people have very different attitudes to money.

Mr W has been reading The Facebook Effect by David Kirkpatrick in which there is a section about how the apps within Facebook make almost as much money as Facebook itself:-

“Transactions inside applications make even more revenue.  Justin Smith of Inside Facebook estimates there were $300 million in such transactions in 2009.  Much of this is spent to buy an upgrade to a more advanced level of a game, or to buy virtual goods, like a fancier shoe to kick your friend in Kickmania.  Playfish’s Pet Society game, where users set up houses to display their pets, releases new virtual items every Monday.  On Valentine’s Day in 2009 the company sold five million images of roses that players could give to their friends .  Each one cost about two dollars.  In Zygna’s Texas Hold ‘Em, players who want more chips than they are allocated each day pay real money to get them, even though there is no way to remove winnings from Facebook.  Numerous Facebook games have revenue exceeding £3 million a month.”

Am I the only one who thinks this is insanity – to spend money on imaginary fancy footwear with which to better virtually kick someone with!?

I read a lot of blogs, including a lot of personal finance blogs.  One of the things that I am always impressed by is the discipine shown by many bloggers when managing and keeping track of their money.  One blog that has particularly inspired me is http://www.nomorespending.net/, written by a lady called Laura.  I confess that when I first read her blog I was a little taken aback by the level of attention paid to every aspect of her budget and every last pound.  But after a while I started to see the point.  There is just no denying it - her hard work and discipline gets results.

I think one of the keys to Laura’s success is that she carefuly sets her targets and then monitors her performance against them.  So I am going to take inspiration from her (well, imitation is the sincerest form of flattery after all!) and try and do the same…

Financial

• Save money - a target of £12,000
• Sell unwanted items on ebay - a target of £1000
• Make a monthly budget (and stick to it)
• Investigate and develop a second income stream (I have an idea, more on that later)

Personal

• Organise my stuff – starting with my wardrobe
• Be tidy - stop using the spare room as a dumping ground and put my stuff away instead
• Lose weight – 1 stone
• Get my vegetable plot up and running
• Stop wilfing* at work
• Keep myself accountable by posting here at least once a week

January Mini Goals

• Save £1000 towards my total by endeavouring to have a super frugal january
• Let my rental property
• Get a Gravatar
• Get my blog header and main picture sorted out
• Set up the composting bin

*meaning to surf the internet aimlessly and derived from ‘what was i looking for?’ (i love this word, especially because it sounds a bit dirty but isn’t at all!)

C’est tout.

As I have mentioned previously (The Starting Point), Mr W and I do not have joint finances.  As far as I can work out this would seem to be unusual, at least in the personal finance blogging world.  Certainly, of those blogs that I’ve read it seems that couples generally pool their resources.

I suppose the upside is that I have my own money and there is no danger of anyone else spending it.  Also, having separate finances does mean that we have to discuss any large purchases because it requires agreement that we are both going to contribute   On the other hand, I have no knowledge or control over what Mr W spends his money on and there has to be a level of trust that we are each working towards the same goal.

We do talk about our finances a fair bit and have agreed that we have two main aims – to renovate our new house and to be mortgage free.  So, we’ve agree that Mr W will have his own progress bar on this website.  As you can see, he’s ahead of me already.  This cannot be allowed.

I said that I would keep a note of my spending for a week.  Here are the results:-

Monday

• 69p chocolate
• £2.85 lunch
• £15 music lesson

Tuesday

• 69p chocolate
• £2.85 lunch
• £1.95 magazine

Wednesday

• £1.58 chocolate
• £3.80 magazine

Thursday

• £1.58 chocolate
• £60 blouse and jumper (on sale)
• £20 going out

Friday

• £1.58 chocolate
• £3.50 lunch

Saturday

• £5 window film (for double glazing the house)

Sunday

• £67.28 grocery shoppping for the week

It looks like I need to consider cutting down on food, and judging by the amount of chocolate I get through – there might also be some undisclosed chocs in the lunch figures – my waistline might thank me too.

Chocolate and bought lunches cost £13.74 (or £714.78 per year)

Magazines cost £5.75 (or £299 per year)

Obviously, I’ve still got to feed myself at lunchtime but if I took my lunch in each day I think I could cut the cost significantly.  Can I do without any magazines?  On the face of it they are a frivolous luxury.  On the other hand, they are something I really enjoy.

Can I do without buying clothes?  Well, my wardrobe is full to bursting so I probably should…

As previously admitted, I could procrastinate for England.  So it may well be that one of my first decisions on the subject of how I am going to go about paying off my mortgage is a sensible one or yet another way of avoiding actually doing something.

 My totally groundbreaking decision is – to get organised.

I reason that I can’t continue with this slovenly, disorganised meander through the world and expect to achieve anything as difficult as paying off my mortgage.  I mean, I might have time to do something constructive if I spent a little less time rooting through all my worldly possessions trying to find that bill that I’ve been meaning to pay for two months/my passport/that old envelope with that man’s phone number to come and fix the electrics scribbled on it.  Even thinking about trying to remember to pay that bill is draining.

 First step.  My work bag.  OK, bags.  I have to carry two for the myriad crapola that I cart around with me.  Admission – the picture above is all the stuff that I have emptied out of my work bags*.  Here is the list of shame:-

• 2 x nail polishes
• £1.50 (yay!)
• 144 euros
• paperclip
• 2 x pen lids
• 20 x receipts
• 12 x flyers/leaflets
• 5 x newspaper/magazine clippings
• 9 x post-it notes
• 3 x envelopes
• umbrella cover
• 2 x train tickets
• 10 x bits of paper (mostly ‘to do’ lists!)
• 6 x envelopes (unopened)
• 2 x amazon slips
• electricity bill (paid)
• 2 x sweet wrappers
• tissues (clean!)
• hairband
• headphone pouch (never used)

I think you will agree.  I have a problem.  We are talking a little more than a few old sweet wrappers lurking in the bottom of my bag.

MrW is aware that I am a bad bag keeper.  But I think even he would be shocked if he knew the true extent of the problem. 

I hereby swear that when I step through the door at night I will check and chuck anything that shouldn’t be in my bag.

*Seriously, I cannot find the cable to attach my camera to the computer.  I haven’t made this up.  I have just illustrated my point perfectly.  I’ll upload the photo if/when the de-cluttering (which MUST HAPPEN) uncovers the  offending item.

The first step in trying to save money/pay off my mortgage is surely obvious – the less I spend of what I earn, the more there will be to put in the kitty. 

I have to admit that I don’t keep track of my money very well at all.  I am very fortunate not to live ‘hand to mouth’ and that has proabably made me complacent.  It didn’t always used to be this way, in the past I’ve been totally skint and tens of thousands of pounds in debt.  I do know what it is like to have absolutely no money so there really is no excuse for not valuing it properly. 

This week I’m going to make a note of everything that I spend whether that is on debit card, credit card, paypal or cash.  Oh yes, I have myriad ways of parting myself with my money.  The idea is just to become conscious of where my money goes so that I can then make decisions about what I am going to keep/cut.

So, I got myself a widget.  As you can see, I have worked out that I am 1.5% of the way to target.

Working out that figure consisted of seeing how much was left in my current acount at the end of last month and then adding it to the value of some shares*.  The grand total was £1,500.

In future I want the exercise of checking my wealth to take a bit longer than that. 

*I have alloted a value of £500 to the shares.  This is the amount that was paid for them and they are trading a bit above that at the moment

So the basic plan is to pay off the mortgage.  Early, that is.  That means I’ve got to find £88,400 from somewhere.  I just haven’t worked out from where yet.

Actually, if I’m honest the figure is actually double that but MrW will have to take responsibility for his half.  We don’t have joint finances.  Besides, if I just think about ‘my half’ for the moment  it doesn’t seem quite so unachievable.  

I hope by making the plan a bit public I can hold myself accountable.  I’m a fantastic procrastinator and weak willed to boot.  Not a good combination for deciding upon and sticking to a plan.

I’m off to try and find some sort of motivating ‘progress bar’ widget.

 EDIT – now that I have started to think about my mortgage I realise that simply finding the money to pay off the mortgage is not be enough.  The house needs lots of work as well.  I don’t know how much the work will cost exactly but I reckon if I find around £12,000 that should pretty much cover my half.  So, let’s not quibble over a few hundred pounds here or there, let’s just take a deep breath and set the total target at a nice fat and round £100k.