The UK is celebrating 40 years of the credit card as Francis Sheehan from the Herald reflects on Forty years on, has the credit card proved a blessing or a curse. While credit cards have been available much longer than that it wasn't until the 60's that Barclay's Bank issued their first card in the UK.

So, has it all been plain sailing? Like most things it depends who you ask. If you posed the question to the list of more than 1300 suppliers you would recieve an answer much different from asking financial counsellors who now process more than 1.2 million debt cases per year, 75% of whom are related to credit cards.

It's hard to imagine a future without credit cards as so many consumers now carry at least one, others more than 2, and rely on them for purchasing groceries, fuel, gifts and assorted household furniture. Their use is by far the most convenient way to make payment on purchases and as it becomes one of the most accepted forms of payment online its future can only grow.

Whether you think that credit cards are a great invention or the scum of the financial world can't detract from the facts. They are only going to continue to grow and present more problems, but hopefully the convenience will win the day.

Posted by Stuart at 7:57 AM | Permalink

According to Marco at mysharetrading.com, Warren Buffett's set to donate a vast portion or his fortune, $54 billion to be exact, to charity.

I may have been a little hasty a while ago when I posted this article accusing the man of being a tight-fisted twat but if his frugality has a purpose far greater than his own needs and influence then Mr Buffett you need a big pat on the back.

I am intrigued though that the two richest men in the world, Warren Buffett and Bill Gates have decided to step away from their companies and begin to help those in need. Why is this? Have they just become aware of the world's disenfranchised nations or are they sensing that there is more to life than power and money?

Whatever the reason, it's a great outcome for those living in the poorest nations and should be celebrated and embraced by other world powers. Let's look after those who can't look after themselves.

Posted by Stuart at 7:46 AM | Permalink | Comments (2)

I am still yet to ascertain the wisdom in saving mobs of money only to bestow it on others after your death, however I'm sure that if I were a recipient I wouldn't be making too many waves about it. Two women on opposite sides of the globe have performed such an action in the past few months.

The first frugal endowment came from an 96 year old English woman who shocked her family when she bequeathed nearly £11million to her nieces and nephews. She had lived a very simple life and her only luxury possesions were a £2500 jewellery collection and a Picasso etching worth £2000.

Her friends and family were staggered that she had horded that amount of money without spending it on herself or tothers during her lifetime. The reason; she didn't want to be treated differently.

The second bequest came from a 90 year old public school teacher who gave more than $1million dollars to a Milwaukee college and established a $440,000 scholarship fund at the University of Wisconsin-Milwaukee and a fund at the West Allis Public Library.

Marian Breskvar had amassed her fortune through frugal investing and had not lived life of luxury either.

It astounds me that some people are like this. While I wouldn't need to have a Porsche in the driveway to feel content with life, I would probably consider it if I had these ladies wealth. While being frugal should be a quality that is taught and respected, hording wealth should not.

These women's money had been tied up for such a long time, both of them were 90+, and could have done more good in the community earlier than saving for the final exit. Each to their own, but that's my view...

Posted by Stuart at 8:01 AM | Permalink

Babysitting is in serious growth mode at present and I'm not talking about your average teenager who's come to mind the children while you and your spouse head off to a party for the evening. It's in far more demand than that and becoming more and more specialised as it panders to an increasingly sophisticated market.

The days when you could just leave your kids for the neighbour to babysit are long gone. Police clearances, referees and exacting personal habits are highly sought after and have become the benchmark for an industry that is on the up and up.

Why is it such a booming industry? As many parents are now required to have a double income just to secure and maintain a mortgage they're looking for childcare that will work in with their lifestyles. Before and after school care, babysitting during the evenings and weekends and even extended periods of care are becoming accepted, and demanded.

This industry has it all; growing customer needs, safety concerns for their children and helpful convenience are creating a demand where prices are at a premium and profits can easily be generated.

Delia Timms, the founder of Find a Babysitter, an online babysitting referral service commented at a recent TV interview
that her service broke even within the first six months and has produced ongoing profits since.

The online service matches parents with localised screened nannies and babysitters from around the country. Parents subscribe to the service for A$49.95 for 3 months and can then choose their prospective sitter from the site. Depending on which plan a parent subscribes to allows them different options of contacting the babysitters at increased prices.

So how do they ensure that babysitters and nannies are appropriate and what levels of screening do they perform. Delia states;

There are a few levels of vetting. Firstly, I review every profile of every babysitter that joins, and then the parents are expected to interview and select their own babysitter so they do all the vetting.

It seems that this business idea is too good to be true, and it is in some ways. Delia is pioneering this online business and is obviously at the forefront of this emerging industry. However, there is very little in the way of competition at the moment and I would expect to see a few other players enter soon.

For the time being, Delia with her husband Jeff, have been able to run this from home and an offsite office and still maintain their own relationship and a family.

Posted by Stuart at 7:02 AM | Permalink

Interesting question!

Can money perform actions by itself? Is it not merely pieces of paper and shaped metal alloys? If this is true then how can money be the root of all evil?

I've had many interesting discussions over this topic especially with left-wing socialists who believe that the world would be a better place if we ascribed to an economic system that gives each person equal portions.

By asking this question we're making the assumption that money has some level of influence over the beholder. That in effect, those who earn or have more money are more likely to be "evil" than those who don't. If it were true then we could safely assume that those who have the least amount of money would be the nicest people in the world. Conversely presuming the opposite of wealthy people.

Or is it just that people are somehow altered by having money that they end up being more evil as a result? This could be true but it therefore alleviates the finger pointing at money and pokes at the behaviour of the person.

My theory is that some people are inherently evil with, or without money, while others are characterised with kindness and generosity with, or without, money. It's just that money exposes what's actually inside the person who has it.

Money, in the hands of an evil person, can cause ultimate catastrophe not only to the person who has malicious intent but also to the victims who suffer at their hands. Take 9/11 as an example. Were the terrorists evil before they secured the finances to pull off their devastating act or was the money merely a tool in their already grubby minds?

The fact of the matter is that we just didn't know they were that evil until the money became available. Once the finance was secured the plan was put into action but only as a result of the evil they had already purposed.

On the other side of the equation, there are many people who are filthy rich who live on modest wages and donate the surplus to needy charities. They create philanthropic trust funds that benefit the poor, the sick, the homeless and basically anyone in dire need.

Was it because of the money that they became generous? I doubt it. If a research study were conducted I'm sure we would see a trend that people who fall into this category were characterised by generosity prior to having the money. It was just that when the money became available they could be more generous than they previously could have been.

The Bible says, "For the love of money is a root of all kinds of evils..." (1 Timothy 6:10 ESV). Why? For we see that people who lust after material wealth (money) are inherently selfish. They pursue it for their own selfish ends.

This doesn't mean that we can't have our own ambitions, desires and dreams. It merely means that we need to keep it in perspective. Think of others, not just ourselves. Consider society before you consider your 3rd Porsche.

Money is purely a tool, either for good - or for evil. Place it in anyone's hands and it will be like holding a mirror to their soul.

Posted by Stuart at 7:02 AM | Permalink | Comments (4)

Could this possibly be too good to be true? Possibly.

But it is possible. It all depends on whether you have nerves of steel and can administer your finances well enough to achieve your goal. If you possess the prerequisites - then credit card providers be afraid!

Mary Hunt from the Cincinatti Post explains the plan really well.

Here's an example: Wabash Bank sends me a balance-transfer offer for its Diamond Visa, which I rarely use and carry no balance. They offer 0 percent for 12 months, with a maximum-transaction fee of $75. They provide me a set of convenience checks for this purpose. Their terms state that I may simply deposit the check into my account to initiate the offer. My credit limit is $15,000. I make the check out for $14,700 and deposit it into my checking account. Once the check clears (this will take over a week), I then transfer the money to my online savings account at Emigrant Direct, which earns 4.5 percent interest. Over 11 months, this 'arbitrage' earns me, after fees and taxes, roughly $430, which looks mighty nice in my savings account. All I really have to do is maintain great credit, make timely monthly minimum payments and remember to close out the teaser offer by repaying the balance in full before expiration.

[Australian readers translate the word "check" for "cheque"]

While this may not sound like much to the average consumer, calculate this out over multiple cards and you could be sitting on some good hobby money. Not to mention getting the banks into some serious knicker-twisting.

I would point out though that the banks can afford this kind of loop-hole as they make enough money from unsuspecting mums and dads who end up forking out for late payments and defaults etc. However, if your conscience is clear...

Posted by Stuart at 5:20 AM | Permalink | Comments (2)

It's always a sad story when you hear that a company that you've been part of has gone down the gurgler.

The reason for its demise?

Mr Rocke said the business was struggling with sales slumping to $12-$15 million per annum because in boom times members were less inclined to supplement their incomes by selling Omegatrend products.

This is certainly an interesting way to fail. Who would have thought it were even possible that as the economy increased your business prospects decreased?

Certainly in the '90's after the sharemarket crash of 1987 in a world of spiraling interest rates and businesses were going bankrupt at a great rate of knots, finding a way to bring in some extra dollars was almost a God-send. Omegatrend's founder, Mr Loren Watts, set about to create his own "Amway" and found increasing success for the first decade. Many mum's and dad's joined the business hoping to achieve some of their 'dreams' that could only be achieved through a sales system that was Omegatrend - at least that's what they told us.

As administrators were appointed there was still a salesforce of 13,000 but only 1500 were active. The business still owed creditors A$2m and 70 employees were laid off.

Look on the bright side. At least there's one less phone call we'll receive from an overzealous friend looking to build his empire.

Posted by Stuart at 7:49 AM | Permalink | Comments (2)

Netcraft recently reported on a flaw in the Paypal system that allowed phishers to exploit their website. The report explains how the fraudsters maliciously set about to deceive Paypal users through a cross-site scripting technique (XSS).

Paypal users met the exploited flaw on visiting the genuine site with a message that read, "Your account is currently disabled because we think it has been accessed by a third party. You will now be redirected to Resolution Center." After a slight delay the victim would be redirected to a third-party page that looked very similar to the Paypal site.

This new site would request the member to login using their normal Paypal identity and ask for the victim to enter other personal details. These included credit card numbers, social security details and PIN's.

Once Paypal became aware of the flaw they set about to remedy the situation and it has now been fixed.

"As soon as we became aware of this scheme, we changed some of the code on the PayPal Web site. So this scheme, or any scheme like it, can no longer be effective," Amanda Pires, a PayPal spokeswoman, said in an interview.

She also stated that Paypal was working with the Internet service provider that hosts the malicious site to get it shut down, and does not yet know how many people may have fallen victim to the scam.

Posted by Stuart at 7:24 AM | Permalink

France has released a new budgeting game Cyber-budget that allows players to assume the role of the Finance Minister and apportion funds to various ministry portfolios.

Alas, the game is in french which counts me out but if you can understand parle vous Francais you probably can make a go at it. However, I'm a little unsure as to why this game exists. It will certainly take an enormous amount of promotion to rival the lastest War Craft and Grand Theft Auto, though I'm sure they're not the audience.

I guess, after the last bout of riots which appear to cripple the french social community, the government is looking for citizens to provide fresh ideas for their welfare portfolio. If you receive a phone call after balancing the budget while increasing funds for welfare and delivering effective tax cuts - it may the Department of Finance on the other end.

Pilfered from 1

Posted by Stuart at 7:39 AM | Permalink | Comments (1)

Taking a vacation is paramount to your wellbeing whether it be a trip overseas or just lounging around your favourite summer retreat. Downtime for humans is just as important as it is for machinery.

I once read a fable about two woodcutters. One wouldn't sharpen his axe as it became unusably blunt the more he chopped with it while the other would regularly stop for breaks and rehone his blade. At the end of the day, the woodcutter who stopped regularly to maintain his axe had cut considerably more wood then the one who just kept going.

We can often think it's easier to just keep going but downtime is valuable as it helps us reset our focus and gives us more motivation to do the things we do.

Deb and I plan to take a month of and walk, or cycle, our way around Italy (this won't happen until the family is off our hands - long-term goal!). While it's a way off I still like to dream and think how this vacation could work and what are the resources we will need to achieve it.

So I figured that if it could be done on the cheap then we should try and calculate ways to do it now. I read this article at About.com where the author, James Martin, presented a list of 12 frugal tips for vacationing around Europe. These are all good tips but I thought there were a few more that could be made so I've included his 12 and added a few of my own.

1. Don't plan a vacation during the World Cup - [My tip] It could be any major sporting or cultural event but at the moment the World Cup held in Germany is probably a good place to start. Unless you want your holiday to coincide with the event it's a good idea to steer clear of the host country if you want to save money.

   Economic theory predicts that when supply is surpassed by demand prices increase. When the world decides to land on a particular doorstep prices will always increase.
   



2. Tickets: Save Transportation Cost with Open Jaws - [James' tip] Want to see a lot of Europe? Plan you trip in one direction, say from London to Rome. Then buy an Open Jaw Ticket, say landing in London and returning from Rome.
   


3. Plan to Visit the Cheaper Countries - [James' tip] Cheapest countries in Western Europe: Portugal and Greece, although the Euro and European monetary policies are tending toward equalizing the price differential in these poorer countries.
   


4. When in Rome do as the Romans do! - [My tip] If you only do tourist activities you miss a lot of what the culture is really about. Take a trip off the beaten track and get amongst the people in whatever way this is possible. It may include some less comfortable options for accomodation but it will enrich your experience and allow you to save considerably.
   


5. Transportation: Where to find Cheap(er) Gasoline - [James' tip] Last year it was Spain, where gasoline was frequently found at less than 80 Euro cents per liter.

   Compare this with a cost over 1 Euro for many other destinations. (3.79 liters = 1 gallon, so .80 Euros per liter = 2.99 per gallon.) Gasoline in Europe is expensive, but the automobiles in Europe are generally more efficient, so a balance is achieved.

   Interesting tidbit: "Compare the price of gasoline ($1.75/gal) with Coca Cola (~$2.50/gal). Gasoline first requires crude oil to be explored and found, than extracted from the ground, shipped to a refinery, refined, then distributed and ultimately pumped into your tank. Meanwhile, Coca Cola is essentially colored, sugared tap water."
   



6. Buy your souvenirs at the markets - [My tip] Specialty souvenir shops expect that you will spend more than you need when purchasing souvenirs for friends and family. If you want genuine reminders of your trip take the time to browse the many open marketplaces that Europe has to offer.
   


7. Cheap Transportation: Train - [James' tip] Italy is still known for its extensive rail network and low ticket prices. If you are traveling around Italy, a rail pass may not net you much savings. Just buy your tickets as you need them at the ticket window or the ticketing kiosks.
   


8. Admissions: Card it! - [James' tip] Most large cities in Europe have discount cards that allow you to visit many museums at a discounted price. Check them out when you go to the local tourist information center--and remember that many have a time limit which may make them less useful to folks who don't want to see lots of museums in a couple days.
   


9. Trains: Trolling for Bargains - [James' tip] When you go up to the ticket window in a European train station, be ready to spout off your destination, whether you want a one-way or round trip, and the departure time of the train you've selected. If you're getting your tickets in advance, ask at the window if there are other trains that might be cheaper that day--you never know. I've saved up to 60% of the price of a ticket just by taking a slightly slower train an hour later than the one I'd originally chosen.
   


10. Renting Cars: Rent or lease a Diesel - [James' tip] Specify a Diesel car when you rent or lease. In many countries, diesel fuel is subsidized, and costs far less than gasoline. It is also widely available, no need to worry about finding it. Many turbo diesels get great gas mileage as well, sweetening the deal. Leasing, or buy-back deals, can also save you money if you're renting for more than 17 days.
    


11. Renting Cars: Rent or lease a Diesel - [James' tip] Vacation rentals are becoming more popular. You'll get room to stretch out and a kitchen to cook in, saving tons of cash over eating out all the time.
    


12. Hotels: Share a bath. - [James' tip] No, I don't mean bathe with someone else, although that can save you money too. There are still some one and two star hotels in Europe with bathrooms down the hall. In many countries, especially expensive ones like Switzerland, sharing a bath can cut the price of a room almost in half. Look for small, locally owned, one and two star hotels or a family hostel. Most of them won't have an Internet presence, so you might have to hoof it a bit to find one, or ask at the tourist information point in or near a train station.
    


13. Eating: Picnic with the help of an Open Air Market - [James' tip] At least once a week most towns in Europe feature a traveling market. Even if you don't have cooking facilities, you can usually buy cured meats, olives, cheeses, roast chicken and pork, and bread, enough for a great picnic and a good way to try the local cuisine.
    


14. Eating: Have your "big" meal at mid day - [James' tip] In countries like Spain, restaurants offer full three course meals, often with wine or beer and coffee, for a set price at lunch time, often for less than 10 Euros. You'll see the notice on restaurant windows. And remember, that price is all inclusive; nobody's gonna add tax, and service is included.

    [My Tip] - I would actually advise that you eat the most for breakfast as many accommodation venues include this as part of your standard room rate. Pack a medium sized lunch to carry with you as you tour the countryside and limit your evening meals to cheese and crackers or soup and fresh bread.
    



15. Eating: Follow the Workers - [James' tip] Those guys in the paint-splattered overalls know where to get a bargain. Don't look just for a restaurant, look for these guys wolfing down huge amounts of food--they know where to get it cheap. Don't count on dainty and delectable gourmet tidbits--you're more likely to come away with great mounds of mama's pasta with tomato sauce and a slab o' roast beef.

    [My tip] - many "people's" restaurants offer a cheap bottle of wine to go with the meal as well.
    

Posted by Stuart at 9:27 AM | Permalink | Comments (2)

"Success will not lower its standard to us. We must raise our standard to success." - Rev. Randall R. McBride, Jr.

How do you measure success? Success in any field is certainly attainable but not always for each individual. It can come in so many different forms that to gauge whether it has been reached can only be determined by a set of specific indicators that pre-empted its arrival.

What I consider to be a success may look nothing like how you would consider success. For me it may be quantitative factors such as material wealth, or numbers that I can chart. For you it might be a more qualitative measure such as depth of relationships, networks or feelings of peace, security and happiness.

However you decide to gauge success you will find the results of such a gauge to be directly proportional to your self worth. If the indicators are pointing upwards all is well with the world, but if they start to decline doubt begins to fester and you find that success seems to be unreachable.

So it would seem that having the right indicators are paramount to measure your success.

Define success and then you'll be able to measure it.

Before you can measure anything you need to have a clear vision of what it is that you are building. Try constructing a house without first clearly understanding how it will look and it won't be built.

Define your life if it were successful? Would it be more income? Better relationships? A good reputation? Would it be more freedom to do the things you like or perhaps being able to help more people in their own lives?

Envision what it is that will make your life significant. Ask yourself the question, "If I were to die today, what would people say about me in their eulogy?"

Find some measuring indicators that show true performance.

Up until now there has never been a better instrument to measure time than a clock. There have been previous attempts , such as sundials, to try and measure time but the clock has thus far been the most accurate. If I were to try and measure time with a barometer I would fail and find myself completely frustrated. A barometer is good gauge for measuring weather but poor at measuring time.

Once you've defined your idea of success you need to find indicators that will measure that success accurately. There is no use writing spreasheets and graphing charts if a deeper relationship with your spouse is your dream of success. There needs to be a better gauge. In this instance, keeping a journal of the changes in your relationship over time may be the required indicator.

Dare to get opinions from others.

Refuse good advice and watch your plans fail; take good counsel and watch them succeed.
(Proverbs 15:22)

Challenge yourself to discuss your plans with people you know care about your success. They may have some advice for indicators you could personally use to achieve your dream.

Always check the indicators you use.

There is nothing worse than heading off into the bush with a compass that doesn't show true north. When our indicators are skewed in some way against the direction we are trying to head in we inevitably will find somewhere we weren't looking for and miss the very thing we were trying to attain.

In my past I have used finances as a basis of measurement but when I really sought out what it was that really fuelled me, I found that money was not a good indicator of that success. In fact, looking at the money actually took me away from my direction and made me feel less worthwhile.

Good (or should I say 'appropriate') indicators shouldn't do this. They should always move us forward.

Posted by Stuart at 7:18 AM | Permalink

The ultimate in spontaneous spending is finally hitting the globe - the World Cup. If you need a reason to spend money then a sporting festival of this magnitude may be the excuse you've been looking for.

For those who've headed over to the World Cup reports have run amok that if you hadn't bought your tickets prior to the games, scalpers were willing to pass up basic seats for a minimum EUR250. Some were getting as high as EUR500 for seats that didn't even have the greatest views. Add your limited accomodation requirements on to the bill, plus the increased food charges, have-to-have sporting paraphernalia and you can kiss your budget goodbye.

But the frenzy doesn't stop in Germany. Direct Line Home Insurance conducted a survey of 2500 adults and found that one in 5 were planning to purchase a new TV prior to the world cup. Add to that new satellite connections, DVD Recorders, surround sound systems and Direct Line is predicting more than £1 billion will be generated from those who didn't make the pilgrimage.

If these purchases were made due to people saving then it we would all give them 3 cheers and congratulate their perseverance. Alas, most of these new gadgets will come at a price that will continue well after the World Cup has finished.

And some marketers will be rubbing their hands with glee, congratulating themselves on the success of an advertising campaign that helped people spend money they didn't have for things they eventually won't need.

Posted by Stuart at 8:11 AM | Permalink

Most of us dream of one day being able to leave our jobs and start living the life that we've always wanted. We've imagined joining our favourite golf club, seeing more plays, wining and dining and perhaps having time to sit and enjoy the grandchildren.

What if that time never came?

What if you were still working past 60 or even past 65 because you couldn't survive on the meagre savings you had accumulated? It's becoming more and more likely that this will be your reality.

Jeff Brown from the Philadephia Inquirer made this statement in his article Why we aren't saving enough;

Only seven in 10 workers are saving for retirement, and fewer than half of them have tried to figure how much they need to save.

I would hazard a guess that most of those who are saving for retirement aren't in their 20's or 30's either. As human beings our tendency is to live for the moment, assuming that retirement is an aeon away and can be dealt with the closer we get to it.

Deborah Fowles from About.com's FinancialPlan challenges our thinking on this;

If you don't start now, you'll never be able to catch up without putting away much more money later, when you'll have other demands like raising a family and funding your kids' college educations.

Tomorrow seems much easier doesn't it. We already understand our immediate needs and know that every cent is spoken for. If we had to save for retirement now then our present quality of life would suffer and herein lies the point.

Why don't we like budgeting? Why is it easier to spend on a credit card that we need to repay than to save cash from our income? Why is it we don't plan and then stick to it?

Because naturally we live for the moment. We're fatalistic, and what's worse, optimistically fatalistic. We believe that we'll be okay and that life will sort itself out. Brown says;

Most people are stunningly overoptimistic. More than 60 percent expect retirement income from a plan sponsored by an employer, such as a traditional pension. But only 40 percent report that they or their spouses actually have such a plan.

Most expect to live as well in retirement as they do now, but think they can do that with only 70 percent of their current income. That's unlikely.

So how can this be remedied?

Start today. If you leave it for another 5 years you'll miss out on the compounding effect of your money and find you will need to save even more.

1. Calculate your required retirement fund This isn't as hard as it sounds. Decide what current income you will need based on your preferred style of living. Do you want to live on the same monthly income as you are now? Can you live on less as your mortgage should be paid by then?

   Use an online retirement calculator to figure out the amount you need to be putting away now.
   



2. Create a savings plan Look at your current expenses and find some that you could live without so that you can start saving for retirement. Takeaway may have to be kept for special occasions, the grocery money may need to be spent on no-name brands and you might like to cancel that magazine subscription.
   


3. Find a good fund manager Once you're saving your income you don't want to waste it on an incompetent fund manager. Do you homework and research the best managers who are consistently returning good profits.
   


4. Utilise and government award schemes In Australia we have two ways that the government rewards those who save for retirement. The first is through salary sacrifice where people can have funds deducted from thei gross salary and transferred to their superannuation fund without being taxed.

   They are also offering tax payers up to $1500 towards their annual contributions of $1000 or less which has come out of their net salary. Both of these schemes help and the sooner you avail yourself of them the quicker they will become useful.
   

If you plan to enjoy retirement then you need to plan - NOW!

Posted by Stuart at 7:32 AM | Permalink | Comments (2)

After seeing Markus' cheque from Plentyoffish.com I began wondering what my life might look like if I were to begin earning an income like that. Deb and I threw around some ideas but I'm not sure we would stick with them if we were to become wealthy - but I hope we do.

People say that money changes you. That it drives you and all your decisions. You can lose friends over it and you make a whole heap because of it. I'm not sure it would change us too much.

We live in a neighbourhood that we really love. Our house is modest but comfortable. We drive good cars and our kids attend a good school. So we consider ourselves blessed and content in our situation already.

If I was earning 1/2 million every month would I buy a bigger house? Would I feel like I needed a Porsche in the driveway? Would I travel more and spend money on opulent accomodation? I'm not sure I would.

I would give a ton of money away. Not because I felt unworthy of having it, but I see so many needs, not only in my own community, but around the world and I would love to contribute more to help remedy them.

My lifestyle would change though. I'd play more tennis. Be my own boss. Sleep in if I wanted to and garden more.

I'm not sure I'd feel comfortable with this lifestyle though.

What about you? If you were earning megabucks, would your lifestyle change considerably? How would you spend your days?

Posted by Stuart at 7:11 AM | Permalink | Comments (4)

The title of this article, More Work = Less Time Devoted to Finances and Less Blogging caught my attention as I was scouring pfblogs.org. The title inspired my own thoughts towards setting priorities in my own life as we all have the same 24 hours to work with.

I know people who can't manage getting their sorry butts of the couch and grabbing life with both hands and I also know people who can't slow down and 'smell the roses.' I'm sure we can all identify some acquaintance with either extreme.

We all need to realise that although our own dreams and aspirations motivate us, they don't naturally motivate those closest to us - or even near us. I suspect that if you were to ask bloggers (those who are blogging for profit) what their motivation was for spending their time doing this activity you would receive multiple and varied responses. In fact, it you were to give them a monetary earnings figure and then also include the personal cost many would want to change something about the deal. Some would be prepared to give more thus earning more while others would be happy to trade lower earnings for a smaller personal cost.

It all comes back to priorities. What is it that you want your life to be like? It can't all be 'beer and skittles' and it can't all be "all work and no play." Each of us have priority thresholds - benchmarks that we will consider trading but only if we can see some benefit to our over all lifestyle.

Many of us have loose priorities. We understand that family is important, we need a source of income and we need some recreation to relax. However, when push comes to shove we find priorities move and settle in some kind of semblance and suddenly expose our inner thoughts and directions.

Why do we need an income? Sure we need our basics but if that were all we needed we probably wouldn't have to work full-time jobs. A part-time job could easily secure these necessities and free up valuable time to spend living life the way we want to. However, if the way you want to live life requires more funds then you'll need to increase the hours you work - making the compromise of available leisure time.

Some priorities we have are real while many are perceived. We buy Christmas presents for everyone in our family including nieces and nephews and it costs a small mint. Why? Because we've always done it this way and our priority is to please those close to us. Could we change this practice? Sure. If it meant that our priority of pleasing family wasn't compromised we'd investigate it - and we have. Alas, to no avail.

Take some time to write out a list of your top 5 priorities and then ask yourself why they are in that order. If it changed, would life be better? Or, worse?

Posted by Stuart at 10:33 AM | Permalink | Comments (2)

Unless you've been residing in a cave of late, or you've just crawled out from beneath a rock, chances are you will have noticed that fuel prices have been increasing. While you have no control over the price at the bowser you do have some control over how you use it. This energy source is only going to increase so without taking the drastic step of converting to a hybrid vehicle and putting yourself under some more financial pressure there are ways to be frugal with fuel.

1. Use your cruise control If you often drive long distances make sure you snap on the cruise control as soon as possible. Your CC will give you moderate accelaration which is far better for fuel consumption that trying to moderate it manually.
2. Drive long distances at night Night driving is usually much cooler than during the day. Therefore, fuel burns at a lower temperature and becomes more efficient.
   
3. Drive smoothly Take your time getting up to speed and don't accelerate quickly. The more aggresively you drive the more fuel you use.
   
4. Buy fuel during the week Basic economics tells us that when supply is high prices will increase. Most people drive more on weekends and are therefore more likely to fuel up during these times. Fuel suppliers know this and alter their prices accordingly.

   This is a basic tip of frugal living - buy when nobody else is. That's why movie tickets and video rentals are cheaper midweek and inner-city parking is free (or reduced) on Sundays.
   



5. Use you air conditioner sparingly Using your air conditioner requires a considerable use of your fuel and has been recorded at increasing fuel consumption by as much as 11%.
   


6. Cycle or catch public transport This may require a paradigm shift in thinking for your own lifestyle but is much cheaper than driving everywhere.
   


7. Car pool with a friend Even if you only did this with one other person this simple action would save you 50% of your normal fuel bill for the same trip. Add another one or two friends and you could reduce it by 75%.
   


8. Test your car on higher octane Higher octane means more efficient burning so buying premium fuel over the normal variety may end up being cheaper. Try a tank full of each and record the difference. Higher octane also means cleaner burning which will save you service fees in the future.
   


9. Coordinate your trips When you head out of your driveway try and pool multiple tasks into the one excursion. Drop off the video, post the letters, pay the bills and then pick up the kids from school.

   If you want to be even more frugal, coordinate where these services are offered. Don't frequent a video shop that's more than a few kilometres away but become a member of one where it's in close proximity to other daily services such as shops and post offices. That way you can park the car and walk to complete each task.
   



10. Convert your car to gas or make your own bio-fuel LPG costs are almost half those of normal fuel and you can get between 60 - 75% the same mileage so it makes sense to convert to gas. The conversion cost will be paid for within a couple of years.

    If you're running diesel why not try and make your own bio-fuel. The process is a little messy and involved but when you're only paying $0.20 per litre compared to $1.40 it is certainly worth your while.
    

Posted by Stuart at 9:04 AM | Permalink | Comments (1)

As most home based businesses fail within the first 2 years of commencing it seems paramount that many people should first consider their options before rushing in.

When you were at school, a guidance or careers officer would ask you multiple questions exploring your talents, likes and dislikes, strengths and weaknesses and to some extent even the hobbies you enjoyed. This would give them some idea as to the types of jobs you might enjoy in your future. Once you left school you had to figure this out on your own and without some wise counsel in your life it's easy to rush the process only to find you later regret it.

People start their own home based business for a variety of reasons; extra income, change in lifestyle, freedom of being your own boss etc. While they could tell you the ultimate reason for commencing such a venture few could share the considerations they made before heading out into the unknown world of home based businesses.

Before setting out looking for the perfect home based business use these 7 considerations as a checklist to ensure you're ready to embark on this journey.

1. What are you passionate about? If the business idea that you're contemplating doesn't keep you up at night excitedly thinking of all the possibilities then it probably won't sustain you in the future. In fact, a few months from commencing you'll feel like it's just another job. Find an opportunity that enthuses and energises you, one that will kick your brain into gear.
2. Does the business idea have residual income? This is not the most important but if you can find a home based business that does have residual income then the business merely becomes a means to end. If you truly are excited about the business idea and could see yourself still doing that 20, 30 maybe even 40+ years from now then having a residual income isn't that important.

   If the business does have some ongoing royalties then it frees you up long-term to engage in other activities.
   



3. Are you able to have multiple income streams? This is the same consideration as one might ponder when investing in stocks and that is to not "put all your eggs in one basket." Finding a business with multiple income streams such as online affiliates or multiple products or even supplementing the sale of products with backup service. If the sale of products were to slow then you might still have the maintenance component bringing in some much needed dollars.
   


4. Does the business idea have longevity? "Will this business outlast my enthusiasm?" is the question you need to ask. Is it based on a current trend but 12 months from now will be a nostalgic discussion point? The business idea doesn't need to have been around forever but it does need to show that it will stay around for many years to come.
   


5. Are your skills and abilities useful in this type of business? This isn't entirely important but being able to learn the skills and enhance your abilities is. If you already have the skills then you have a head start on your competition and should be able to reap rewards faster than your competition. If you don't it will take some time to learn and the speed at which you're willing or able to glean the knowledge you need will, in effect, shorten or lengthen the time it will take you to be successful in this business.
   


6. Have you thought about your marketing strategy? Very important. No matter what business you are in if you don't have a marketing strategy then expect your business success to take a considerable amount of time to eventuate.

   In my younger years I started a magazine on the back of some current trend (where was this list back then?) and thought that as long as I could get them into newsagencies I would be laughing all the way to the bank. Eight issues later I could no longer sustain the expenses and had to walk away from it. Not enough people were hearing about it.
   



7. Are you willing to commit to it? This is the question that could supplant all the others. After our magazine foray we headed off into a tomato drying business. Two years later I was still spending 3-4 hours every morning cutting up and preparing these tomatoes to be dried and I eventually asked myself the question, "Do I really want to be doing this for the rest of my life?" - the answer was no.

   While I didn't expect to physically be preparing the tomatoes for ever, I knew there would still be a couple of years before I could employ others to do it or pay for the machinery needed.

   If you can't answer this question with a resounding "YES" then you are wasting your time. As soon as some hardship comes along you'll find it to easy to bail on your business idea and go searching for another.
   

Take the time to consider your options. If it's a good idea that you're looking at then it will still be there tomorrow and you will be better prepared to handle it.

This post was inspired by this article.

Posted by Stuart at 6:44 AM | Permalink | Comments (1)

I hope you read the fine print.

In many of today's credit card application contracts there is reference to a set of terms should you default on a payment. You may start out on a low interest rate but find, by missing a payment, you will end up converting to the default interest rate - usually 20-30% higher than you were initially paying. There's nothing new about this practice yet there are still many credit card users who are unaware of this policy because they don't read the fine print carefully.

However, this little nuance is minor compared to what is being defined as the Universal Default clause. This clause states that if you miss making a payment to ANYONE that reports on your credit history your interest rate will immediately convert to the default rate.

Take this in for a moment.

You could have faithfully used your credit card, making payments as and when they fall due yet you miss a payment on your telephone bill that is reported to the credit reporting agencies and immediately your credit card institution hikes the interest rate. And they're well within their rights to do so.

For anyone who is looking to accept a really low interest rate for a new credit card make sure you read through the contract and understand all the fine print.

Source: Bill Burt "'Universal default': Lenders gang up on late payment"

Posted by Stuart at 7:25 AM | Permalink

I find it amusing when I often hear people say to me that they can't pay their fees because the water bill is due this week. Or somehow, out of the blue, the rates notice appeared and if it's not paid by the end of the week interest will be charged. And, how many times have we heard people getting their phone lines cut off because they haven't paid for the past couple of months.

The definition of "Panic Budgeting" is spending every cent your earn until you're forced to part with it from another party. "Planned Budgeting" on the other hand is to ensure there is always enough cash in the bank to pay bills as they fall due. Is planned budgeting a utopian ideal or is it possible for mere mortals to do this?

Budgeting is a discipline which interpreted into English means "it's going to hurt and create pain to learn." If budgeting was easy we would all be doing it and blog posts like this would be superfluous. However, while it may be painful for a while planned budgeting is only a temporary hiccup. Panic budgeting if not resolved will plague you for the rest of your life because no amount of money can satisfy people that don't know how to use it.

I know people eaarning $100K per year who have to scrape together a few dollars to pay a bill. I also know single mothers earning less that $25K who are paying off a mortgage always have enough and never go without. The difference: planning where your money goes.

Posted by Stuart at 7:29 AM | Permalink

Your personal financial plan is your road map to financial freedom and independence. I probably should have underlined the word YOUR because we so often hand the reins of our financial plans over to others. We may do it consciously by accepting the latest morsel of advice hoping that this new piece of knowledge may be the key we've always been looking for. Or worse, we accept the "voices" in our head that tell us to deviate from our premeditated plan.

An analogy that may encapsulate my point is the many times I would head off 4 wheel driving in the bush. If I had unlimited time and an ongoing source of fuel I would explore every track that I came across. But I usually had a destination in mind before I set off. As an undiscovered track appeared I would stop and weigh the virtue of adventure against the map. If it took me in an opposite direction or would obviously increase the time taken to get to my destination then I could easily discern that it was a wrong way.

The same applies to your own personal financial plan. Sorry...did you just say you don't have one? Well that's like hopping into you car with a blindfold covering your eyes. You drive off aimlessly hoping to arrive somewhere but readily realising your chances of success are extremely limited.

It's okay. Not everyone has their own financial plan. The government has accepted this and would previously provide a pension. Once you reached a certain age you could retire and receive an ongoing income until the day you died. They have since reneged on this financial plan and began encouraging us to invest in our own superannuation. Now it's compulsory. Why? Because many of us travel through this lifetime (our one and only mind you!) with very little direction.

How do you create a personal financial plan? Permit me to share a couple of points;

1. Ask yourself the question, "Where do I want to be in 5, 10, 20 or 50 years from now?" When you can clearly see a picture of the destination it's much easier to plot a course to get there. What income would you like to be earning? What time do you want to get out of bed in the morning - or afternoon? Which tourist destinations would you like to have travelled to and enjoyed? Would you like to give money away to those who are in dire need or at least support your kids and give them some financial freedoms?
2. Write your vision down and keep it before you. If you only ever set the destination once and never return to the guiding road map it will become just a faded memory. Remind yourself often as to where you are heading.
3. Break it down into bite sizes. The age old "How do you eat an elephant? - one bit at a time," is very true. If you're just planning your personal financial goals 5 years out then consider what it is that's needed to get there. I can guarantee it will be a change in direction or at the very least a change in the way you've been driving your life so far.

   Does this new financial plan require increased income from other sources? What level of risk am I willing to accept? Am I prepared to work harder for a set period of time to ensure that my personal plan will be met? Do I need to delay having children for a couple of years? These are all questions that need to be worked out carefully because they will set the backbone of your financial plan.
   



4. Start making the changes It's no good making the plans if you're not prepared to start working on them. This is where most people come unstuck and their dreams are never fulfilled. Anybody can do the first 3 points. People who realise their dreams are the ones that begin to implement this one. This is the key! You've planned your path now it's time to tread it.
   


5. Stick to your plan. This is the next hairy pitfall. If we were to break down into percentages how people act on these points we could assume that 50% only do the first 3. Another 40% continue with point 4 leaving 10% to reach their destination because they stuck with point 5.

   It is so easy to deviate from your plan once you start moving. A couple of years into a 10 year plan and things don't appear to be going the way you thought they would makes it easy to begin doubting that you made the right financial plan.

   I'm not saying don't tweak it from time to time. If you believe that a certain path can get you to your destination faster, or easier (this one I usually doubt) then alter your plan accordingly. But, never throw it out and try to start again. Keep working your plan until you reach your goal.
   

Posted by Stuart at 6:50 AM | Permalink | Comments (1)

After a successful State Youth Games and a great weekend away with a bunch of young people I'm finally back on board. It's been so tempting to steal away from the group and check out my stats via an internet cafe but I resisted and enjoyed a great weekend.

Thank you for all of your wonderful comments and well wishes. I certainly am humbled by your response and hope that any new readers that stick around will enjoy the journey with me. It's great to have you on board too.

Posted by Stuart at 6:43 AM | Permalink

If I had realised that my last post would have caused such a stir I would have planned strategically for it, written some back up post material and spent the weekend on my computer forging the next phase.

Alas, I'm off this afternoon for three days in my capacity as a youth pastor taking a bunch of kids 30 mins north for the Annual State Youth Games. This means that the opportunity to entice all the new people who headed this way after Darren's very humbling post of my modest earnings will be missed .

Nevertheless, life isn't all about the almighty dollar and if it was blogging would be boring. So to those of you who were willing to trek the blogosphere over the weekend and found that we're out, my humble apologies.

We'll be back on board Monday afternoon.

Posted by Stuart at 3:30 PM |