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Although it is well into 2010, I’ve been meandering my way through the year with no aim in terms of financial goals. Sure I’ve achieved many personal goals and hope to fulfil others, but I’ve got nothing on paper for the personal finance side of my life. So I guess I should brainstorm some up, eh?  

1. Pay back my parents. This is the top priority for me, and will even rank ahead of establishing savings. I currently owe them $7,098 which might seem like a lot, but it is well down from the combined debt I came back with after my trip. There is a lot of emotional attachment to this debt, as I really find it uncomfortable owing money to people – especially to my parents. I guess this is the reason why Adam Baker of Man vs Debt constructed a different method of debt repayments based on emotions.

2. Establish an emergency fund. Although Dave Ramsey is a big supporter of establishing an emergency fund even if you are in mountainous debt, I am not putting this on the top of my list given the lack of obligations I have other than to my parents. If I were to lose my job tomorrow, I’d feel pretty bad for not being able to pay back my parents but I wouldn’t be kicked out of the house either. Combined with the fact that I have no other monthly expenses other than my mobile, I don’t see having an emergency fund as a huge priority. Having said that though, I am squirreling away $100 from every pay to establish the initial $1,000 recommend – just in case.

3. Don’t use my credit card. This is another big issue for me. After having seen how a lot of interest can be piled on in a short amount of time, I don’t want to ever go back to making interest payments ever again. There is no justification to paying $109 on interest and fees over 3 months for a balance of $1,500.

4. Save for my end of year trip. Yes, I will be going overseas again at the end of this year. No, I will not go with $0 and come back with approximately $9,500 in debt. Yes, I will save accordingly. At the moment, I am putting away $100 every fortnight and hopefully a significant amount of my pay after my debt has been cleared. I estimate having $2,000 to spend in around 2 weeks which should be enough. Hopefully.

Although these goals might not seem like much, it feels like a good starting point given my circumstances. I don’t see these goals changing all that much, but I would like to see the amount projected in number 4 to be higher as I will be making purchases for work clothing during my trip. Nevertheless, 2011 will see big changes and hopefully by then I will have more specific goals to aim for.

I received my Tax Refund today for the year ended 30/06/2010, and received a full refund of $1,238. Although I was expecting more (Around $1,500 or so), this amount was still satisfactory as I could use it to knock off a significant portion of debt. Not so. You see life always throughs unexpected expenses against you and in this case is in the form of my next CA module’s fees of $1,106. I am quite relieved that this amount can be offset by my tax refund as I wouldn’t have known what to do if I couldn’t.

I decided to put some numbers in and if I didn’t receive my tax refund, I would have had to either:-

1. Stretch out my debt repayment plan.
2. Not progress with my second module. Or;
3. Wipe out my savings, emergency fund and current account balance in one fell swoop living precariously on edge once again.

Thinking long and hard about the choices, I honestly believe I would’ve gone with the second option. I’ve lived with overdrafts before and I would not like to do so ever again if I can help it, so option 3 is out of the question and my debt repayments have gone on for a long time already and I wouldn’t want to stretch it out from an estimated 4 more months. I’m just glad I didn’t have to pick any of those options, and it just reinforces my focus on establishing a solid emergency fund as soon as possible.  

Daily Expenses

Travel - $84

Work Food - $40.50

Entertainment - $26.50

Alcohol - $74.20

Eating Out - $107.85

Groceries - $5

Total - $338.05

A relatively solid month in terms of minimising spending, although it should’ve been much less in terms of alcohol. It seems to me that I am hovering around spending $100 a week. This would be very good compared to previous months, but still has a lot of room for improvement during my debt-elimination phase. I am still aiming for $80 a week and hope I can achieve that during August.

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Well, a month has past since I essentially launched FYF. In the past month I have eliminated my Credit Card debt and am starting to make progress on the loans I have against my parents. My total debt with them stands at $7,598 and is comprised of:-

$1,000 – 2009/2010 Voluntary Super Contribution

$1,098 – CA Module Fee

$5,500 – Japan Trip

I am not aggregating these amounts as I believe small victories will keep me focused instead of looking at the big picture and thinking “Damn, I still have that much to go?”. After I pay off the first two amounts, the $5,500 will seem a lot more manageable.

This month was also when I started to actively contribute to savings and establish an emergency fund, where I will contribute $100 to each every fortnight. I will stop the Emergency Fund at $1,000 as suggested by Dave Ramsey but will continue with the savings whilst I am aggressively paying off the debt.

$10 – Dinner at McDonalds’

In a spur of the moment decision my friend and I decided to try and tackle the $29.95 family meal at McDonalds, between the two of us. If that wasn’t bad enough, my friend is tiny with an appetite suitable for someone of her size. The give an idea of the daunting task, the family meal consisted of:-

-          1 Mighty Angus Burger

-          1 Grand Angus Burger

-          2 Quarter Pounders

-          6 Chicken Nuggets

-          4 Medium Fries

-          4 Medium Cokes

Needless to say, we barely did half of that and I ended up taking a Quarter Pounder and the rest of her burger home to eat for breakfast the next day. This was obviously a bad idea from the start and one I hope to never repeat again. It might be funny and for laughs, but no good can come from an idea like this!

$20.5 – Weekly train ticket

$18 – Food from 7-11

It ended up being $1 day at 7-11 where various items were heavily discounted to $1. I decided to take advantage of this and probably went a bit too overboard, buying 11 cans of Mother, 3 bottles of Dare Iced coffee and 4 Sausage Rolls. The good thing about this was that I won’t need to buy my morning coffee for awhile.

$19 – Toy Story 3

I really wanted to watch this movie, and it didn’t disappoint in the slightest either. One qualm I had with the experience is the cost itself. The fact that it was in 3D didn’t enrich the movie in any way, and I firmly believe that the future holds no place for 3D movies – especially if the price for admissions end up staying at $19.

$10 – Dinner at Star Bar

I was a bit stung financially by the price of the movie so I breathed a sigh of relief when a dinner at Star Bar was suggested. $10 for a beer, steak and chips is always a good option.

$60.1 – Alcohol at Clubs

This expense was a bit hazy given the influence of alcohol. Although I had a lot of fun, it shouldn’t have been this expensive given the free alcohol at my friend’s birthday which I skipped out of whilst sober to go clubbing. Buying drinks at clubs are usually not a good idea.

$25 – Haircut

Usually I get haircuts every 2 or 3 months, which means when I turn up at the hairdresser I come with a long unkempt style which obviously gives no indication of how I like my haircut. This usually ends up with me having a completely different haircut each time. The haircut itself would’ve costed just $15, but I opted to go with a wash for $5 (I went at lunch during work hours) and a little ‘extra’ for another $5. I’m not sure if I regret the little ‘extra’ I paid for.

$30 – Dinner at Porchos

Had dinner with a friend of mine at Petersham which serves an amazing Portugese chicken burger. We decided to sit in instead of take away as the line to the counter was extremely long. To put this into perspective, had we stood in line – we would’ve not yet gotten our burgers when we finished eating. Although the burgers costs $5 normally take away, being up sold on chips and a drink to $15 per person is still a great bargain for the a very filling dinner.

$5 – Groceries

We were having a night in for drinks, so decided to get snacks on the way to go with the beer bought. My friend paid for the case of beer, and I paid for the dip, nuts and dinner.

$20.5 – Weekly train ticket

$19.85 – Dinner at KFC

$7.5 – Movie Popcorn

In a rare occurrence, I decided to watch a movie – Inception. It was amazing, from an experience’s point of view and worth every expense made. That being said, eating KFC (especially a big meal like that) was probably a bit over the top – along with the popcorn. I think from now on I’ll refrain from buying popcorn, it is such a waste of money and dangerously bad for your health.

Dinner - $17

Had dinner with a friend at Satang Thai, a nice cheap thai restaurant in the city. We ordered the Chicken Green Curry, Chicken Cashew Nut, two rices for both of us and a Coke (I don't drink it at home). The cute thing about this friend is she always splits the bill meticulously, no matter what.

I had to withdraw $40 for this week's expenses.

Current Cash Balance - $25.65

Train Ticket - $2

Didn't want to stay at family friend's house waiting for my parents to finish playing Mahjong till god knows when.

Current Cash Balance - $2.65