Monthly Archives: October 2012

New Government Plans

The new government plans were presented today. For us this will imply:

  • Triple (at least!) healthcare expenses and higher own risk
  • A bit less income tax on a part of our salaries
  • Less tax return as compensation for the tax we pay on our mortgage
  • My salary will be frozen (I am in eduction)
  • Less pension

Of course there are other consequences, but I can’t really tell what they are going to be.

Crisis and budget cuts have officially hit The Netherlands. Now, everybody has to think about their spending. That could turn out to be a good thing, right?

Love,

Mrs EconoWiser

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Making Money: Send Your Newsletters On The Last Sunday Of The Month

Yesterday I sent a newsletter for my side business. Why? Simple, at the end of the month people will have received their salaries. On Sundays (especially when the weather’s bad) they’ll be sitting behind their computers wanting to spend that money. I send a newsletter once a month and it’s always on the last Sunday of the month. Extra sales guaranteed.

Good luck!

Love,

Mrs EconoWiser

Senseless Spending: Expensive Parking

Today we went to a board game event where you can play different board games to check which ones you like best and either buy them or put them on your wish list. We chose the latter. This event was hosted in another city so we took our car there. Upfront I told my husband we might park a bit further away from the site and either walk or bike up there. We have two foldable bikes. However, we were running late and decided not to go for our Mustachian plan, but park the car at the event. This decision cost us 10 euros which we could have avoided. Next time, we should plan properly.

Would you park your car a bit further away in order to save money?

Love,

Mrs EconoWiser

Book Review: ReWork #3

ReWork #1
ReWork #2

GO

Make a dent in the universe – Do something that matters and make a difference, if you’re going to do anything.

Scratch your own itch – Create a product or service that you yourself would want to use.

Start making something – Turn your ideas into actually making something. Everybody has plenty of ideas. It’s about whether and how you apply your ideas.

No time is no excuse – There’s always an excuse not to start your business. Everybody can squeeze in a couple of hours a week.

Draw a line in the sand – Remember WHY you’re setting up your business and tell that story to the world.

Mission statement impossible – If you don’t believe and live what you stand for you shouldn’t pretend to. You need to be genuine.

Outside money is Plan Z – It’s not worth it to attract money from outsiders. Soon they will tell you what you need to do with your business.

You need less than you think – You don’t need all the fancy things, be frugal.

Start a business, not a startup – Startups are run by people who expect it to fail. Just start an actual business.

Building to flip is building to flop – Don’t be the guy who starts something and then quickly sells it off. You’ll regret it.

Less mass – Bigger is not better. Bigger costs a lot of time, money and headache. It makes your business less agile.

I did not apply some of the tips in this chapter. My side business does not really make a difference. Some other business ideas we have, do make a difference. I also didn’t scratch my own itch when starting my side business. I don’t use the stuff I sell. We did start making a website and sell things even we started off with a small stock. I’ll let you on in a little secret. I only ordered samples from my supplier the first time. It made the impression that I had a lot of stock, but there was only one piece of each item. This way my prospect customers were not disappointed by a small amount of goods to choose from and it made a rather professional impression right away. Time isn’t an excuses indeed. I started my side business while having a job and going to university. Instead of watching TV you could be out there creating a business and making money. I didn’t draw a line in the sand with this business, though. I am also sorry to say that I don’t really have a mission statement. I just sell stuff at competitive prices. Outside money was never an issue. I LOVE the frugal remark in this book and the authors will keep on telling to stay frugal. Music to our ears, right? I made some really frugal choices for my business. We use free software (OSCommerce) and I have the cheapest of cheap trays for my goods since customers won’t see those anyway. Also, I reuse things and keep track of things. I indeed started a business, and it’s fun! I certainly did not start the business in order to flip it. It has provided us with a solid income stream for over five years. I have no intention of trying to grow my business. I do not want to hire staff. It’s fine as it is. With our other business ideas we hope to do it the same way.

Love,

Mrs EconoWiser

Sell Sell Sell…Not Your Stocks But Your Stuff

Every once in a while I get Unclutter Crazy and go through our stuff. There were once more hanging too many clothes in my wardrobe which I hadn’t worn in a long time and I just know I won’t be wearing them any time soon. So I decided to sell some items. Ehm…after rummaging through my clothes it’s more like 20 items. I made pictures and put them on the Dutch version of Craigslist. I already sold a couple of pieces. I also sold two Chinese bedside cabinets which we haven’t used in years for 20 euros. I gather I will make around 150 euros in total with what I found so far. Not too bad, right?

Do you turn your stuff into cash?

Love,

Mrs EconoWiser

Mortgage Advice

Today we had an appointment with our mortgage advisor. She needs to calculate whether our plan is realistic. We want to put extra money into the savings part of our mortgage. Here in The Netherlands there are a couple of rules attached to something like that. You have to stick to a certain bandwidth. We think it’s doable and with this extra payment the amount of years we would be paying for a mortgage will be lowered from 30 to 26 years. Since this was a bit of an odd request she couldn’t calculate this for us immediately. We’ll hear from hear within two weeks. By then, I hope we have a new cabinet here in The Netherlands and things will be clear about mortgages. Right now, everybody’s just guessing since we’re in between cabinets.

Love,

Mrs EconoWiser

Our Emergency Fund

Difficult topic this is. Suze Orman advises an eight month emergency fund. Some bloggers like mymoneyblog have twelve months of cash stashed at readily available accounts. Mr. Money Mustache hardly ever keeps more than 3,000 dollars in cash. My husband and I had “the talk” about our emergency fund.

I was shocked to find out that our emergency fund is 152% at the moment. One hundred percent would be our average annual expenses without doing any fun stuff. In case we would both lose our jobs this is the amount of money we would need to maintain our basic lifestyle. It feels ridiculous to have that much money in saving accounts at a lousy rate. Currently this rate in The Netherlands is about 2,5%…I know… Our mortgage interest rate is 4,35% which I think we negotiated pretty well, what do you think?

Anyway, I dropped the fact that I would really like a fixed number for our emergency fund so that whenever we exceed that amount we’ll be using that to make extra mortgage payments. My thoughts were to have an amount that equals 2,5 months, but my husband felt more comfortable with the number that equals a 5 month emergency fund. I have to add that I have very little, if no, risk at losing my job in the near future. My husband works for a large company and in these days you just never know if a company is going to lay off people. For now, we both think he’s safe. Also, he wouldn’t have a hard time finding a new job with his skills and degrees (ICT).

We are now thinking of this new idea but we haven’t decided whether we want to go for it just yet. On Thursday we’ll meet our mortgage advisor and tell her that we want to make an extra mortgage payment equaling 7,5 months of average expenses. Also, we’d like to draw up a plan for the future about these extra mortgage payments. Again, Dutch mortgages are a bit difficult to explain. Our mortgage is split into three parts. Two-third are two guaranteed savings account mortgages and one-third is an interest-only mortgage. We are going to “invest” in all three of these, equalling 2,5 months worth of expenses in each.

What amount of emergency fund do you feel comfortable with?

Love,

Mrs EconoWiser