Four hours, lots of screeding through paperwork, pencil shavings, bits of eraser and two beers later – it’s *almost* done.
I have to say almost, because there’s some things I don’t know the cost of (ie car registration), or when the bills are due (ie building insurance), but a few phone calls in daylight hours should fix that up pretty quickly. It’s looking a bit scary, because we have some pretty huge outgoings (ie multiple mortgages and associated costs), and some tidy amounts coming in to cover those costs (ie multiple rents). While we’re not rolling in it, we appear to be breaking even (touch wood!) – and we really need to be BECAUSE:
We brought a new car today.
I have been needing one for a while (he prefers bikes, so all the car dealings are mine by default!), the one we have needs a lot of work done to it, and it’s really not worth it, so I’ve slowly been coming around to the idea of a new one (sure – it’s only taken him TWO YEARS to talk me around!). This one will be fine for my daughter to drive around town while she’s learning; it’s a older (10 years used to be nothing on a car – remember?!?!) type, and very sturdy, so it should see her fit for a year. Then once she has her open licence, she can trade it in on a newer one. And once ours is paid off, we can either upgrade, get a newer 4WD, or another house (that would be his option!). It was while we were doing all the financial jiggery pokery that we realised that both of our finances are a bit all over the place (while I’d worked out that mine needed consolidating a while back, he needed to see the picture for himself), hence the financial planner.
The idea now is that both of our wages will be going into new individual personal bank accounts. Each of us will keep a ‘slush fund’ – as small as possible, but allowing a dinner/movie treat once a fortnight or month – and the rest will go into a joint bill paying account. The planner allows us to allocate funds on a fortnightly basis, as each bill is calculated monthly and yearly, and then divided between pays – so instead of having to come up with ‘X amount’ in a given pay to cover a particular bill, all of the bills are calculated together, thereby ‘sharing the load’ across the entire year. Hopefully we’ll get as many bills electronically as possible, and be able to direct debit them. It will mean that I will need to get over my phobia of looking at bank accounts (for fear of what I might see – usually it means I have been bad, and the outcome will be bad. And it’s usually correct.), and take a more responsible attitude towards book keeping.
Associated with this bill paying account will be our savings account. Any excess money that we can put into the account over and above the minimum bill paying requirement will be syphoned off into the savings account. Having all of these accounts with the same bank as our mortgages will make transferring money easy enough. The mortgage account will remain a stand alone account for the time being, as an offset account wouldn’t be of any benefit to us at this time. Rents go in to this account, mortgage payments come out, and associated costs (such as insurance, pest control, body corporate fees, rates and utilities) either come out before the rent gets to us, or from the balance of the account.
So, within the one bank, we will have:
- The mortgage account: rent in, mortgage payments and associated costs out;
- Two individual accounts: pay in, bill money out, slush fund accumulated;
- One joint bill paying account: bill money in, excess money in, bill payments out, savings out; and
- One savings account: excess money transferred from bill paying account.
The goal/aim/challenge is to pay off the car as quickly as possible, then to replicate the success to finance the deposit on a new property. I haven’t got figures yet, so I haven’t got a time frame, other than ‘as fast as possible’. By setting up the accounts like this, it means that we both need to be more responsible for where/how we’re spending our money (no more ‘whim’ purchases from eBay for this black duck – the bucket won’t be quite so bottomless anymore!), and we’ll have to save for special things again, which will make us more concious of where it’s going. It’ll be interesting to see how much money I will end up having to myself a fortnight… I stopped looking at where it was going years ago – and I don’t think he ever did! It’s quite a challenge, and I’m looking forward to it. Lets see how these figures end up…