When sanity > principles

Money or sanity?

I have a strong sense of fairness and justice (which sometimes makes it hard to exist in this world). But I’m also quite pragmatic and getting more ruthlessly so over time.

Which is why I’ve made the conscious choice to write off certain sums of money over the past few years. To move on and look forward. Let go of the expended stress and energy, and devote that time and headspace into productively making that money back even quicker. And of course, to not get into the same situation again.

Let it goooo

Heinous flatmate (approx $1000)

Blood from a stone. He was a terrible person to live with and is terrible with money/being employed/adulting in general. I’ve written off the money he owes for bills and damage and moved on.

Tax refund

Can’t really remember the amount – maybe $500? Anyway, T was due a tax refund a few years back that went into limbo somewhere between the IRD and his bank account. Endless back and forth never resolved it and we’ve moved on. (Subsequent refunds have made it through fine.)

Work expenses

Again, the exact amount has faded from memory and I’m certainly not going to check and dredge it up, but a couple hundy? Suffice to say toxic boss #2 in this post was a nightmare from start to finish. T chatted to someone from the labour department but ultimately, not enough proof of the context and it being a work expense. Live and learn.

Unpaid freelance invoices (approx $1000)

Loved the work. Hated the chasing of payment. I did a series of features and was paid for about half. Struggling magazine, new editors, tardy accounts … just one big clusterfuck.

Unrefunded bond (approx $700)

Our last tenancy was a nightmare. Anything to put that memory behind me.

I know lots of you mentioned in the comments on this post that you’d written off small amounts in the past – what about bigger ones?

5 things I’ve learned from surviving a marriage crisis

The best relationship advice I can give

After more than 10 years in a generally happy union, I recently realised that – like Jon Snow – I knew nothing.

Nothing at all.

I once read that good marriages begin after the first gigantic crisis. When you begin again, in spite of everything, and work to make it through the anger and fear and sadness.

Separately, the wise and inimitable Alain de Botton has said that pessimism offers a solution to a lot of the pressures around relationships. Romanticism is unhelpful, and makes a lot of what we go through in marriage seem exceptional and appalling.

Depressing as those two paragraphs may sound, I think they ring with truth.

There are five main things this crisis taught me. Here is what I’ve learned.

Love is a verb

Don’t just tell me you love me; show me through your actions.

So many of our habits and behaviours towards our partners are manipulative

Whether we realise it or not. Awareness is the first step.

Do not tolerate sustained unhappiness in a relationship

Don’t put up with it now, hoping that it will improve eventually, if you have no inkling at all for when that might be. Think about how long you could stick it out if nothing changed – a month? Six months? A year?

Never set yourself on fire to keep someone else warm

There is no glory in martyrdom. This isn’t a social movement; this is your life. Your happiness is what’s at stake.

We are flawed

All of us. So very deeply. This is something we must accept if we are to move forward.

There it is – the best relationship advice I have to give. Have you been through a relationship crisis, and has it taught you anything new?

Call me mercenary, but…

More money, more options

There’s no nobility in poverty.

No romance in being broke.

No joy in struggle.

I really really really like being able to afford to:

  • Heat my home
  • Visit the dentist
  • Eat dinner out
  • Wear real leather
  • Buy 3-ply TP
  • Donate to charity

Call me mercenary, but in my life, money has directly correlated to quality of life and happiness without exception.

Literally every area of my life has improved thanks to money. Not saying I’m on a never-ending chase for more above everything else (especially since I hit the so-called ideal salary for happiness) but earning more is certainly a goal. As long as I can grow my income while maintaining enjoyment in what I do, why wouldn’t I?

Fewer dollars = fewer options. Life has only gotten easier as my income increased.

I eat better. I am healthier (because I live in a house that isn’t damp and cold). I have a reliable vehicle. Pets. I’m a hell of a lot less stressed and feel less vulnerable to the bottom falling out of my life.

When you’re going through a period of life that’s defined by scarcity, it’s incredibly stressful. You’re panicked and constantly worried, living on the edge. You make poorer decisions because you’re just not in the best frame of mind and/or have fewer choices available to you. You simply don’t think about the long term future because you have to focus on getting through today, tomorrow and maybe next week. How can you possibly think about retirement when you lack decent housing today?

Whatever the reasons for money being tight (and they can be oh-so-complex – acute, chronic, unfortunate, deliberate) the outcome is the same. And in the moment, that’s all that matters.

Money stress has a way of keeping you up at night, not to mention tainting your waking hours with its sneaky way of spilling into every moment. 

The first day in 2016 that I felt truly free from financial stress – for the first time in, oh, just about a full year – was amazing. There are no words for the lightness that brings.

I’ve spent far too much time in misery for lack of money. On the other hand, I’ve never been miserable with money.

I cannot relate to the ‘broke but happy’ brigade. YMMV.

I’ve lived through times where I’ve had enough, and times without enough – and I’d take the money every single time.

Link love (the fees-will-get-you-every-time edition)

NZ Muse link love roundup

Indulge me, if you will!

I remember the first time I learned that banks could charge you for the privilege of holding your money, when my ex’s mother spoke about the $10 monthly fee on her day-to-day account.

More recently, I got to hear about some of the stuff that regulators are involved in within the consumer protection space. Changes to the law last year put a much bigger onus on lenders to disclose, disclose, disclose – to be upfront about fees and costs associated with credit contracts, as well as be more responsible and ethical about how and who to lend to. Noncompliance can apparently result in borrowers not being liable for fees/interest if lenders don’t play by the rules. And one finance company has been caught out charging excessive and irrelevant fees – eg high loan establishment fees due to building in overheads beyond the scope of any work involved with actually setting up a loan. The view is that lenders shouldn’t be making huge profits off these kinds of fees, to which I say amen.

Another much more mainstream topic of late has been KiwiSaver fees. On average KiwiSaver fees are 1.3% per annum and now that the scheme has been going for a few years, balances are getting higher and thus providers are getting an ever-bigger cut each year. There’s a new provider, Simplicity KiwiSaver, launching soon that will be totally passive – the international part will be handled through Vanguard. Given that I might be paying up to $40k in KiwiSaver fees over my lifetime, I’ll be keeping an eye on this to see if it’s worth switching. Maybe other KiwiSaver providers will up their game and sharpen up.

This week’s links

Still not quite sure how to answer this: What are you proud of?

The best financial advice

What’s harder: saving or repaying debt?

8 financial commandments

Finally, I’m feeling this post on first home ownership so hard right now.

Should you quit your job to travel?

Should you quit your job and travel_

I’ve been there. Wanderlust eating you alive, from the inside out. Digital nomads and travel bloggers all over the internet urging you to up and go this very instant.

So, should you quit your job to travel? Before you make that leap, there are a few factors to consider first.

Your employment

How career driven are you? How much do you enjoy your job? Could you work remotely?

If you quit your job to travel, would you get rusty being out of the game? How could you stay sharp or pick up new skills? How might a resume gap look (in some industries nobody will even blink, in others it could be a big deal)?

What will you do when you get back? Be honest: how employable are you really?

In my case I had learned a lot from my job and was prepared to quit outright if I had to. I was confident my resume was strong enough that I wouldn’t be out of work for too long.

But I was also a valuable team member and was able to negotiate an extended leave, meaning I had the security of a good job to come back to. I wasn’t miserable by any means; but my itch to travel was no longer containable.

Also see: How to Take A Career Break to Travel, by Alexis Grant

Your housing situation

Say you do decide to quit your job and travel. What will you do about your home? Rent it out/sublet it? (And what if something goes wrong while you’re away?) Give up your lease? Sell it?

Where will you stay when you get back? How hard will it be to find a new place then?

For me it was an easy choice. Our rental was a typical NZ rental – damp, freezing and unhealthy. I wasn’t going to miss it.

Your current obligations

Do you have pets? Dependants? Family members who rely on you? Any other commitments tying you down? If so how might you manage these from afar?

Your finances

Put simply, can you afford it? How much will you need for your trip? (It all depends on your destinations and travel style.) Will you need it all upfront or do you have a plan to earn money while travelling? Do you have debt repayments, etc to keep up with while away? Are there bills and subscriptions that you can suspend or cancel? How much will you need when you get back – to settle in, cover you while job hunting, secure a home, etc?

Also see: How we travelled the world without going into debt

Enjoying the ride

Will you actually like travelling continuously? A long term trip is not like a brief holiday. Extended travel has very little in common with your typical getaway of a few days or weeks. (There’s a reason lots of big name travel bloggers have now set up a home base somewhere!) Be sure to plan to leave some rest days in your itinerary – even perpetual travellers need weekends 😉

Finally…

What if you realise you can’t tolerate going back to your old life?

You don’t necessarily need an answer to that now. It may or may not happen. But I’m a big believer in plans. So give it some thought along the way – just in case you fall in love with a new city or country, or decide you want to be a self employed free spirit.

What I believe about money

3 things I believe about money

I spend a lot of time thinking about money, between work and my own personal interests neuroses. Here are some conclusions I’ve recently reached.

I don’t believe in hopes and wishesBut I do believe in setting your sights on a target. 

I work at the exact organisation I once imagined would be an ideal place for me, in a newly created role that perfectly suits my skill set, at the salary I was determined to reach.

There’s something to be said for knowing where you want to go – how else will you be able to get there?

I believe in plans. But I also believe in taking little leaps of faith.

The two biggest financial decisions I’ve ever made – taking a six month leave to travel, buying a house – were not airtight. The general plans were pretty rock solid; I’d been working toward them for awhile.

But I didn’t have quite enough saved by the time we left the country. I was pretty confident I could make it up while freelancing on the road (and I did, almost to the dollar…) and at the worst, I knew I had a job to come back to.

And in many ways I bought a house at the worst time, my accounts having been decimated due to circumstances beyond my control. But I felt secure in my job and was earning a reasonable income, and a down payment that met requirements.

Life is fickle and while we can – and should – do our best to plan and prepare, nothing is ever 100%.

I believe your pay is not necessarily reflective of your worth.  But I believe in negotiating for what you believe you’re worth.

As above, I honestly never thought I’d earn what I’m making now. If I’d stayed in journalism, I wouldn’t be. But out of it, my skills are marketable enough to justify what seem like insane pay rates in comparison. (Not that these go all that far in NZ or Auckland, or impress mortgage brokers, but it’s a huge step up from before.) I look back on the jobs I’ve done and the call centre and hospitality work I once did was so much harder and so poorly compensated.

Whatever you do for work, do it to the best of your ability, and remember that nobody else will fight as hard for your best financial interests.

What do you believe about money?

Disease Called Debt

CYA: Revisiting my insurance coverage

Although insurance isn’t a huge line in my budget, the peace of mind it provides is invaluable. While my car insurance is pretty sussed and doesn’t require much thought, a couple things have got me rethinking some of my other insurance cover.

Contents insurance

I stumbled across a TradeMe thread the other week in which people were discussing how much contents insurance they had. $100k for a three bedroom house seemed to be the consensus. This was my reaction:

WTF?And then I followed one of the links through to a contents insurance calculator and whizzed through quickly. By our standards, their allowances were a teeny bit insane. $7k for two laptops? A $1500 dryer? $4000 of shoes per person? An expensive china cabinet full of antiques? Nuh uh.

I’m not sure we count as minimalist, but we don’t have a ton of stuff realistically and most of it isn’t worth very much.

To be fair, we probably are a little underinsured (I can’t even remember exactly how much cover we currently have) but hopefully come next renewal, we’ll also have redone the kitchen and may as well roll all those changes up at once. Very little we own was obtained new, but I am definitely aware that should we need to replace it all at once it would be expensive. That said, should we lose everything in one fell swoop, we would still replace things gradually in order to get more for the money. It took about 3 months for us to buy a bedroom set after moving in here (dresser and bedside tables).

A kitchen with a dishwasher, a decent fridge, a gas stove and cabinets not from the 1960s will probably add a significant number to the amount we want to be insured for. Still, the annual premium dropped to around $400 when I became a homeowner, so hopefully it will still be pretty affordable even after increasing the coverage and updating the policy accordingly.

Health insurance

Previously I’ve had a bit of a look into private health insurance – where previous employers offered discounts through Southern Cross (my current one does not) and when I needed my wisdom teeth out. And maybe now once again, since a friend is undergoing expensive dental work after an accident which is only partly covered by ACC.

Every time I’ve reached the conclusion that for me it’s a waste of money, my needs are around optical and dental and the cost of policies just don’t stack up against what I would get back. T might benefit from policies that cover physiotherapy, being both accident and injury prone.

What I would give for a comprehensive health insurance comparison site! Maybe this is an instance where an adviser would actually be worth it.

But I suspect this is something I’m going to put aside yet again. Maybe when kids come into the picture (my two bosses who have kids reckon they’ve got their money’s worth and more from health insurance).

When did you last reconsider your insurance coverage?

What to do if you have champagne taste on a beer budget

What to do if you have champagne taste on a beer budget

No judgement if your tastes skew a little more extravagant than your budget indicates. I think most of us know what it’s like to not have everything we want.

It’s an eternal struggle. Our money is limited but the list of things we can potentially do with it is not.

Spend less

The quickest win is to cut expenses where possible. A dollar saved is a dollar earned (and won’t be taxed!). Trimming the budget = instant savings.

For most of us the three biggest expenses are housing, food, and transport. If you can cut down on any (or all!) of these big ticket costs you’ll be saving money every week/fortnight/month on these regular expenses.

While renting I always endeavoured to keep rent as low as possible, but now that I own I’m making extra principal payments with the aim of eliminating the mortgage outright earlier than scheduled. We’re a one-car household, which saves an untold amount of money, and while we could easily spend much more on groceries and eating out (and would love to) we keep it in check as much as possible.

Other recurring categories to look at are all your utilities and subscriptions – internet, phone, power, water, TV, gym, etc. I have a fear of commitment when it comes to these things and have no contracts for any utilities. That said, I do have a Spotify subscription, mainly for music on my commute!

Earn more

Sometimes there’s no way around it – you just need to bring in more money.

The most basic existence in today’s world costs money, and the kind of life you want almost certainly costs more than that.

If you can’t achieve what you want on your income, or at least make progress towards it – even after cutting back and ruthlessly prioritising – you may need to grow your income.

Whether that’s by diversifying your income and making money on the side, learning to negotiate or change jobs to make more, or even retrain and upskill in order to increase your earning potential, there are options.

In my experience this has made the biggest difference. Even when I was first starting out I was constantly side hustling to earn more money to squirrel away for my goals.

Making more has seriously supercharged my ability to get ahead. With that extra money I’ve been able to save and invest, buy a house, stop buying clunker cars. Quite simply, I could not have gotten this while making $40k, because there’s only so far you can trim expenses. I increased my income $15k overnight, and almost $30k in under 2 years – no amount of frugality could have achieved that same impact.

If you want to get right back to basics, the key thing is to spend less than you earn. And thus there are only two ways to improve your financial standing are: spend less and/or earn more.




Disease Called Debt

Link love (the cake-for-breakfast edition)

The best weekends start with cake. Always.

And then they segue into bumper link roundups. One that’s had me mulling it over is this HuffPo piece on honest marriage vows. My 2 cents: I couldn’t agree more on the dishes – this is why a dishwasher is a must for me when we renovate; and so far, working towards a place of trust around managing money seems to be working.

This week’s links

The power of financial surrender

And of changing your money mindset

Frugality takes time

Bleeding on the job

Rent rage

Mind hacks for money stress

The stories we tell ourselves matter (and here’s my version of this)

You’re not meant to do what you love – you’re meant to do what you’re good at

Working in your passion is overrated

Affiliate income for beginners 

The allure of shiny better vs real  better:

In my humble opinion, real better has these characteristics.

It brings a deep, calming happiness rather than a shopping-thrill kind of rush.

It doesn’t rob future you of comfort, stability and choice.

 

How much does it cost to get chickens?

Meet Betty White and Helen Mirren #suburbia #chickens

A photo posted by egesther (@egesther) on

I suspect having chickens won’t actually save us money overall (because, uh, I don’t actually buy free range eggs). But it’s fun to have chickens around, and we’ll have truly free range eggs once they start laying.

Here’s a breakdown of the cost of getting set up with chickens.

Buying a chicken coop – $220

Originally we’d planned to build a chicken coop, but after looking at the cost of kitset coops online and the cost of raw materials, we decided to buy one premade. It came in pieces, with (largely incomprehensible) instructions and we put it together ourselves.

The high end ones go for around $500-600; at the budget end, you might find homemade tiny coops for $50. The ones that are around $100 or less on TradeMe are often also billed as being for bunnies, for what it’s worth.

Water dispenser – $12

From the local pet store. We didn’t buy a special feed container; we just use a small metal bowl we already had.

Feed – $15

Our first bag of feed was a small one from the pet shop and didn’t last very long – a week or two? We now buy chicken feed from the supermarket and a $10 bag lasts maybe a month.

Hay – $10

There’s a local-ish lady who specialises in all things rabbit-related. She offers heaps of stuff for small animals, including fresh hay she packages up herself and sells online.

Two chickens – $50

I wanted to get chickens from a nearby farm, but the one I contacted never responded. (Similarly, I still haven’t heard back from a local dog daycare dude who runs a service on his farm around the corner … I want to give you my money, seriously!) So we got our birds from our local pet shop. It has an entire bird barn – this part is bigger than the normal pet store part – so I didn’t feel too bad about this, as it’s actually a specialty of theirs.


We also recently built a big run for them, which cost about $180 in materials (though we didn’t use all of them). For a while we let them run around freely but they seriously crap everywhere and it was getting a bit much. (At one point they were even drinking from the dog bowl, which I found amusing.)

ETA: Right after I published this post, they finally laid their first eggs! Here’s hoping they get the hang of it fast – so far they’re averaging one each every other day.