Smart saving starts at home

In these times of uncertainty and economic difficulties, the need to save is most essential.  There are actually many ways to save here and there, but the home is the best starting point to learn the discipline. Here are smart tips that can be easily done at home to help you ease the effects of economic insecurities.  

Avoid unnecessary expenditure. 

Do not buy things you do not need.  Whenever you are confronted with the shopping question “Do I need it?” think 5 to 10 times before making a decision.  Also, buy only the amount of food you can consume. Did you know that in the US, 33 million tons of food waste was thrown away in landfills and incinerators in 2010? According to the Environmental Protection Agency website, food waste forms the single largest component, 34%, of municipal solid waste discarded. In Canada, the residents of Toronto throw away 17.5 million kilograms of food every month, according to the World Vision Canada.

Your Christmas Budget

How much should you spend this Christmas? Or have you thought about it? If you haven't experienced any problem with money before, then this article may not appeal to you. But for those who have, it is highly recommended to create a budget as early as now. Some people can really get overwhelmed with the Christmas hype and spirit that they don't realize they are spending way too much than they should be. If you say that since it is Christmas, it is alright to overspend, think again. Would you really want to be broke come New Year's time?


Here is a sample list of expense items that Filipinos normally buy during Christmas time.

Health Issue: How much do families in the Philippines spend on contraceptives?

The Reproductive Health (RH) Bill is such a big issue in the Philippines today. As of publication time, the Senate is still in a hot debate whether to pass this bill or not. Meanwhile, people may be wondering just how much the poor can save if the government will be providing free contraceptives to them.

If the spending reflected in the Family Income and Expenditure Survey is indeed reflective of the total amount they need, we can have an estimate of how much the government will likely spend.

Home Issue:How much is the average expenditure of Filipino families on food?

I have started this Home Issues series in my blog with the average spending of families on electricity. Now, I think I should have started with food as it is the most basic need. I used the same dataset (FIES 2009) as the one I used in electricity. The FIES is a nationally representative survey of around 40,000 families conducted all over the Philippines. The 2009 survey is the most recent available Public Use File.
I found that the average family spent P74,808 in the whole year of 2009, roughly $1,570.  The typical family in the Philippines during this time was composed of about 5 members (4.7 to be exact). The typical person's food consumption has amounted to P17,554, or $368.

Home Issue: How much is the average electricity bill of Philippine households?

What is the average electric consumption of Filipino households? For curiosity, I look into the data from the Family Income and Expenditure Survey (FIES) conducted by the National Statistics Office (NSO). In 2009, there were about 2.6 million households which did not have electricity in their homes, that is roughly 14% of the 18.4 million households in the country.

For those who have electricity, each family paid an average of P7,809 for the whole year in 2009 (current prices) or about $164.  This formed an average of 3.7% of their total expenditures (7.3% of non-food expenditures) for the year. The average monthly bill therefore was around P650, or $13.66.

Surviving the amortization woes

When you find yourself having difficulty paying for your mortgage loan, don't worry coz you're definitely not alone. In fact, at some point, all of us experience anxiety over paying the monthly amortization. Based on experience, the difficulty can actually be lessened or even the amount can be lowered with these steps, and they can help us get by.
1. Save and pay in advance to principal
Not only for rainy days when you need something to save you from having to pay the penalty but more so to have some amount to pay come mortgage anniversary. Paying a lump sum amount no matter how small it is is helpful in lowering your future payments for the property (of course holding other factors constant). If you earn extra money here and there or get that big bonus, it is wisest to save it to pay an "advance to principal." If you realize that only a small portion of the monthly amortization actually goes to paying the principal loan (in our case, only roughly 30 percent which means 70 percent are interest payments), you would appreciate more the importance of paying in advance to principal.
2. Ask for a rate reduction from the bank
I used to be passive when it comes to the interest rate that the bank impose. Well, the time of blankly staring at the bank notices on interest rates is over for me. I always ask for a rate reduction every time. I simply send an email stating why I am asking for a lower rate, and guess what - I always get our rate reduced. Cite the current inflation which gives you headache in budgeting or if you are receiving remittances where the Peso-Dollar exchange rate matters a lot to you, air your concerns over the Peso appreciating a lot making the Peso equivalent of your dollar receipts lower than it used to be. Convince the bank why they should give you a lower one. Most likely they will give in, a percent or two perhaps.
3. Budget, budget, and execute it
Avoid facing the inevitable circumstance of paying penalty by carefully guarding your budget. If you think you will be short of funds, make adjustments early on. Our bank gives us at least a week grace period, I assume other banks have that sort of allowance, so there's actually enough time to make remedies. Don't wait until the last minute before you act.
Want to read other saving tips? Check out how you can cut grocery expenses.

Japan Home Center

'Passed by the Japan Home Center, commonly known as Daiso in Japan, last week. And I got myself some nice looking body and foot scrubs. The foot bath salt reads "Cappuccino Horniness-Removing." Hehehe! I would have preferred "callus-removing" there. Anyway, it is always fun dropping by this store. One can really get some nice bargains. I got these two cute notebooks below for only P88. I also got 4 rolls of soft paper towels for the same price. There are 3 stores of Japan Home Center in Makati, one in Walter Mart, just across Don Bosco Makati, another in Park Square 1, along Pasay Road (Arnaiz Ave.) and in Cash and Carry along South Super Hi-way. Look for other stores in the official website of Japan Home Center. Just one tip when you go in any branch, buy only the essentials - those that you think really are good bargains, or you'll end up buying so many cute stuffs you wont be needing. It's actually a good idea to buy those very affordable but useful things, you can even start buying gifts for Christmas as early as now. These notebooks below can be really nice gifts, especially for teens, just wrap them with tissue gift wrap and tie them up with a nice ribbon.

Timeless treasures at the thrift shop

These days, it isn't easy to find things that of good quality but great value for money. But with a little more effort in looking and really sorting through items, one can have a great advantage going to thrift shops rather than buying new ones from say the mall or the furniture store.  With the right timing and a dose of luck, you can really get items such as furniture and accessories that are priceless. I have been going with my bestfriends to thrift shops recently, we were looking for a 6-seater table made of solid narra wood. My bestfriend needed a table that goes with her narra chairs, such pricey inheritance from her ancestors, because they are moving to a new house. Because she had been moving around asking lots of people already, she kinda learned quite a lot about the stuff she needs including the prices. Usually, the price of a solid narra table would range from 20,000  to 30,000 but she got hers for only about 16,000. It's a good bargain for such a rare and valuable piece. And there's so much more than furniture that are worth visiting in thrift shops. There are decors, chinaware, and collectors items such as the Elvis Presley doll (shown in the photo below). There are also lamps, chandeliers, signature bags and women's accessories, all pre-loved of course. These photos shown are those from thrift shops in Hen. Hizon Street in Bangkal, Makati - you might want to check it out.

Loyalty Cards Anyone?

Loyalty cards are in. Go to the nearest shopping mall or supermarket, even drugstore, and it’s likely that you’ll be offered a loyalty or rewards card if you still don’t have one. Its main objective (at least for me) is to reward shoppers for being loyal. It’s also an easy way to get people to continue patronizing the store.  After experiencing some of these rewards cards myself, I couldn't help but compare them and see which stands out in terms of service, practicality, and convenience.(Photo courtesy of justanotherpixel.net)

Have a clean Christmas!

It's Christmas time once more! Here in the Philippines, Christmas season begins at the very first day of September. But most families prepare to decorate their homes for the holidays around first week of November, right after All Soul's Day.
I say it's unwise to change motif this year and buy new decors. One way to save on budget is to make do with what you have, just make sure your decors won't be the cause of allergies and respiratory ailments. Clean decors in soap and water for good health and peace of mind this Christmas season.

 

How to survive the crisis and enjoy the coming holidays?

As I've mentioned in my previous post, Christmas is a very special occasion in the Philippines, so special that people actually do a lot of efforts to save some during the year to have something to shell out at Christmas time.  Here I have collected simple tips on how to save some money. Also, although the Philippines seems to be not as devastated as the other countries with this global crisis we are in, we moms need to work harder now more than ever to survive it.  I have also localized the examples so we can easily relate.

Drink more water. Instead of soda or iced tea, drink water to save some money. Not only that, you'll be less thirsty and that prevents you from getting another drink.

Walk short distances. Rise up early so you'll have extra time to spend on walking that short distance from your home to the train or bus station or to the street where you ride the jeepney. In this way, you get to save what you pay for the pedicab/tricycle. Set aside what you save so you would know.


Pack your lunch. If you can help it, prepare your lunch yourself and save extra money.

Compare prices. Allot enough time for shopping so you can compare prices. Try out cheaper alternatives for the brands you usually buy.

Use coupons. No matter how low the discount rate in coupons, these still help you in stretching the budget.

Start haggling. If you don't do this before, start doing it now and it will definitely help you save some.


Get a lower credit card rate. Make that call to the credit company. Ask for ways in which you can lower your rate. I have friends who did this when they had difficulties paying for the minimum balance because the interest rate is eating up all their budget. They were able to get deals that provided them zero interest if they can guarantee to pay a certain amount every month for a year.  

Do not do balance transfer! It will only bury you more in debt. Remember that when you transfer your credit to other bank, you will have to pay some extra interest on top of what your original creditor already charged you. Unless they give you 0% additional interest for the balance transfer AND give you more flexible installment package, stick to the original one.

Sell stuff. Look around the house for stuffs you no longer need but are still in good and usable conditions. Organize a garage sale.

Reuse. If you're planning to change the motif of your Christmas decor, think again. Reuse those that you already have, just try to give it a reinvented look by using your creativeness and artistic skills.

Buy Christmas presents early. Do this so you will have ample time to look around and try the get the best value for your money. Rushing will only get you to spend more than what you have allocated, you may also end up not really liking what you bought.Check out the schedules for Sale at the mall and grab this opportunity.
 
Refinance your home. If this is becoming the issue for you, talk to your creditor and ask for refinancing.