Budget for the start of the new financial year

The end of the Australian financial year is only 2 days away. Most people probably have New Year Resolutions in regards to budgets and savings but I think the beginning of a new financial year is an even better opportunity. So what does it involve for me?

For the first time, I now have a budget and an expense spreadsheet. I've set it up a few months ago and have been practising but now it's ready to go for the start of the financial year on 1 July. Don't get me wrong I have set-up budgets before but never followed them or I tried to track my spending without actually having a budget. But now I've got a fantastic document - thank you Lynn and David for creating this spreadsheet! I've changed the headings and added an overview to it, so I could enter an amount under each heading and then calculate the total for each category which made it easier for me to come up with the budget.

I used the link out of the Down to Earth Forum. If you're not a member, please sign-up as it's a fantastic community providing excellent advice. Alternatively, you can fin the
Budget Tracking Spreadsheet here. Please note, I have not done this spreadsheet - it's all thanks to Lynn and David!!!

Once I entered all of our expenses, I was in shock. More or less each month everything I earn is spend. And I earn a very decent salary. I mean I sort of knew that we weren't saving a lot because I do read our statements but seeing a 5 digit figure coming in and going out again in the same month is a different sensation all together. So where can I save?

1. Income: This will be the same every month until my contract runs out. I also have an income from my investment properties. I'm not planning to take on any more work, so I will need to find a reduction somewhere.

2. Loans: Home Loan and Investment Property Loans are our only loans we have. We make extra repayments for our home each month. We also both have credit cards but we always pay them off in full.

3. Budgeted Savings: Additional to the extra repayments we're making for our home (this money could be withdrawn in an emergency), I save money monthly for a separate emergency fund and holidays.

4. Home Bills: Rates - nothing we can change and our rates bill isn't very high as we don't have access to town water or sewerage. Electricity has always been high. Everytime we turn the tap on, 2 pumps will start (water to the house and greywater from the house). Also as I never rains here (except for Jan & Mar), we need to water our plants which is done from the bore water but also costs electricity. Our beautiful Pool also uses a lot of power, however, we were able to change the Tariff for the pool pump and that saves us about $200 per quarter. We have now installed solar panels and hope that this will reduce our electricity bill even further. Unfortunately Steve is not so great at saving power and always leaves everything on. We normally don't have to pay for water - only if the rain wasn't sufficient to fill our tanks. We have about 55,000 L of water storage and that lasts us a season.
Gas for our hot water and the stove is required and we might get a new bottle once a year so that isn't pricey at all. Our monthly phone/mobile/Internet is too high. I need to call the provider and reduce as we hardly ever make any phone calls but our plan offers $350 worth of calls. So, here is my first saving.

5. Home Living expenses: Furnishing/Decors, Repairs, Renovations, Gardening, Appliances and Tools. Hm. I know I spend a bit on those areas. Unfortunately, I'm not blessed with patience and when I want something, I want it now (how annoying, I know). So, I have to sit down, write down all the things I want, the price and then schedule those items. We're working on upgrading the house and making everything efficient, so I know this will take some money and work but I will have to learn to schedule it. this is my second saving.

6. Investments: We have several investment properties (mostly our old homes) - they all cost money: rates, water, insurance and maintenance etc. We need to sit down and calculate if they're continue to be financially viable. If we sell them, we reduce our expenses in this category but also under our loans section. This is my third saving.

7. Transport: We have one car, so we pay Rego, Fuel, Insurance as well as maintenance on it. I recently reviewed insurance and was able to save $600! We live about 30 km away from town but we wouldn't use the car more than once a fortnight - except when we go on holiday. I don't think there's any more we can save here.

8. Medical: Doctors Fees, Chemist, Dentist and Specialists - they're the only costs I do not want to compromise on! There's nothing more important than our health.

9. Food: Since I started stockpiling, we only go to the Supermarket fortnightly, mainly for dairy products such as milk, cheese and cream as well as anything which might have run out. I bought half a side of beef and a lamb early this year and I can see this will last us for the rest of the year, so no more buying meat in the Supermarket or the butcher. We got our meat from a local farmbutcher for $6/kg. I try to grow fruit and veggies but it's not yet enough (we're slowly getting there), but I do buy them from the farmers markets once a month and then preserve/freeze the rest. I reduced our monthly grocery bill from about $180 a week to $50 a week - all by stockpiling!!! Very happy with that.
We hardly ever have take aways, so not much expenses there but we do go out a fair bit I've noticed. This is my forth saving - taking our own drinks and food from home and have a picnic instead of going out for lunch.

10. Work: I need to pay for my own flights to get to Perth and then also need accommodation and transport. I try to book everything as much in advance as possible but it's a fair amount of money I spend on travelling for work. The only reduction I see is if I would change jobs but then I might use more fuel for the car, so maybe that's not an option.

11. Insurance: Home and Contents, Building Insurance for our investments, car, health as well as travel insurance are essential for us. However, it pays to shop around before you renew. I saved over $2000 this year by changing my insurance provider.

12. Clothing: Steve and I don't need many clothes or shoes. Mainly if something is worn, it is replaced but that's about it. I try to buy the best clothes I can get to get good quality. I used to buy a lot of clothes and now have a set wardrobe and I stopped buying. I do plan to learn mending, knitting and crocheting but I just haven't got enough time for it at the moment, so this is something I would like to do when I retire and something I'm looking forward to. Another saving, but not in the upcoming years.

13. Animals: Our chooks, birds and dog need to be fed, Hera needs to get her annual vet check-up and supplies such as hay for the chooks, beds and toys for the dog and birds are required. The expense here is far smaller than the pleasure I get from my beloved animals, so nothing to be changed here.

14. Recreation: I love to read, Steve loves to travel. My hobby is certainly cheaper than his. We pay for flights, accommodation and car hire. As I have 6 month of the year off, we do a lot of travelling. Therefore we decided to buy a caravan, which will enable us to reduce the spending for accommodation and car hire. With the amount of travelling we do, the caravan will have paid itself off within a year. The only exception is international travel. My entire family lives in Germany, so I do want to go over there and visit them every 3-4 years. Saving money from this category is my fifth saving.

15. Grooming: Haircare - twice a year, beauty treatments - sometimes a massage when I return from work and my back hurts, cosmetics as required. I like to be well groomed and I like make up. But I have stopped buying the most expensive stuff. I use Grown and love their products! They use natural organic products. At home, I make a lot of things myself, at work I cannot do that, so I don't believe I can save much more money in this section.

16. General: Presents - I normally buy when I see something suitable and then keep it for the occasion. I've stopped buying Newspapers and Magazines and I use the Internet instead or recycle my old magazines. I don't spend much on stationary. Postage is a big one as it's expensive to send things overseas. This is my sixth saving: If I send items earlier, I can send them much cheaper. Alternatively I can buy something overseas online and get it send to Germany. I do give monthly donations and will continue to do so because I believe this is the right thing to do.

So as you can see there's 6 potential savings in my budget I will need to explore. I will let you know how I go. What are you up to this weekend? Maybe enjoying a nice relaxing afternoon and doing up a budget? Let me know how you go.