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Thrifty


Thrifty Thursday 23rd June 2011

 When being thrifty could land you in court?

I read yesterday of Colin Watson, ages 62 who nearly ended up in court for loan sharking! He is agoraphobic and has claimed benefits for his illness for 6 years – this was made very clear to the court by the prosecutor, who said that it amounted to £86,000. It sounds a lot of money but as the alleged offences only took place over the last two years and the prosecutor appears to be making a big thing of the fact he is a claimant; I suspect part of the money was housing and council tax benefit.  He was accused of money lending without a licence, ‘concealing’ criminal property and two counts of lending money. One count of lending money to a friend was apparently an interest bearing loan. Agoraphobia is a serious illness and the poor guy couldn’t go out to spend all his benefits and so lent some out to friends. Agoraphobia is a curable illness and so he may have been better saving up for treatment. The judge didn’t ask what his doctor was doing to help or the mental health team or that army of community psychiatric nurses or social services. The prosecutor in the case was reported as saying ‘This case may raise questions about the way this country delivers its benefit system.’ He failed to get he poor guy prosecuted and so tries to put the whole benefit system on trial. The guy would need money to pay neighbours to do his shopping and other things. He was actually getting around £140 a week plus housing benefits. It seems he was spending just £350 a month. The remaining £200+ a month he used to make loans to friends; usually interest free. I buy my neighbour a gift voucher at Christmas and sometimes her birthday because she does some shopping for me; does that make me a criminal?

 It may be legal but is it honest and fair?

 You have seen the adverts for BT broadband for just £13 a month but it doesn’t tell you all the details unless you read the small print. The line rental is extra and if you want reasonable usage and 24/7 calls it’s extra. They do give you the first 3 or 4 months free though…  So let’s do a like for like comparison for £28 a month and £10 line rental I get unlimited calls and no cap on the broadband – right? Wrong again…  The line rental is £13.90 month, its £10 if you pay a year in advance. Oh… right… So it’s £41.90?

Save £43.20 per year. Cheaper than Virgin & TalkTalk

£41.90 isn’t cheaper than TalkTalk!

NB. You need to make at least two calls a month to avoid a £1.50 monthly charge. Payment is non-refundable

What an extra £1.50 for not making calls? You cannot be serious!

So it could cost as much as £43.40 if I happen to go on holiday for a bit and not make any calls?

What am I paying now? £23.91 with TalkTalk… What’s the service like though? Crap just like BT…  but I do get international calls…

I have used BT as an example of how they try to con us, but it could have easily been Virgin, Sky or TalkTalk.

I had a canvasser knock my door from SSE (Scottish and Southern Energy plc), a sure sign they are about to put their prices up. They are still doing the “We are British” stuff and parading their ‘green’ credentials. The canvasser was quick to remind me that Scottish power was now Spanish owned (Iberdrola). SSE wouldn’t have anything to do with the Spanish would they – they’re British and oh so green!

Nuclear power

SSE announced that it was in talks regarding investment in the “new generation” of nuclear power stations requested by Tony Blair’s government in order to meet carbon emission goals. On 28 October 2009, a consortium of GDF Suez, Iberdrola and SSE was successful in securing an option to purchase land for the development of a new nuclear power station at Sellafield on the Cumbrian Coast from the Nuclear Decommissioning Authority.

Energy companies will try to con us too and so what can we do? We can try to avoid doing business with the worst offenders, like BT and SSE!  I may change my energy supplier and it might be to Eon who it appears may be the cheapest but they will raise their prices; I doubt if they will rise by as much as Scottish Power because their last price rise was hefty. The 19% raise from Scottish power is a bit much.

We have to shop around on price in the short term but we also have to look at the morals of a company and that will give us some indication of whether they will screw us with a price rise after their current ‘sales’ promotion has ended. It may help us sleep at night to be with companies that have some morals anyway…

If you have examples of immoral or amoral companies please go to the bottom of the page and comment. I really hate pay day loan companies like Wonga. You may like my average or typical blog or why not just go to the home page and pick one!

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Thrifty Thursday 16th June 2011

Petrol (gasoline)

I accelerated out of a roundabout yesterday when I was driving and I have been thinking about the cost of petrol (gasoline). If I accelerate hard now it can cost up to a £1 a mile in fuel. Ouch! I think yesterday wasn’t too hard but even so to drive a mile like that would still cost 50p or maybe more. I got on the dual carriageway and let the engine tick over in 5th gear at 1,000 RPM and did 40 MPH easily. The cost was still more than 10p a mile.  I saw small cars passing me and they were accelerating hard and so using more fuel than me. I also place both hands on the steering wheel once I’m in 5th and cruising. I notice many drivers driving with one hand, which you can do easily with power steering. The reason I use two hands is because in an emergency I have more control. I also see many other ‘professionally’ trained drivers like police officers doing the same thing. They also use the gears very effectively. You can save quite a lot of money by adjusting your driving style. I had a motor cycle pass me on a narrow road, which was risky. I followed him for a mile and he gained no time by doing a dangerous overtaking manoeuvre. I see cars racing in the same way and gaining no time. In the metropolitan area I live in, the average speed is down to around 15 MPH, because of congestion and ‘traffic calming’. It is just as well to stay calm and drive slowly. I’m lucky to get 40 MPH on the dual carriageway and even the motorway has a speed restriction for some reason, down to 50.

Still on the subject of cars, I changed the wiper blades on mine this week. It seemed an easy job and if you can do a little job yourself it saves money. The replacements were universal and so I had to use an adapter to fit the new ones; I got it eventually! I thought about polishing the paint work and even tried some polish on the bonnet. Polish may seem like simple stuff, it isn’t. Imagine your paintwork to be like hills and valleys and you want to make it smooth and shiny. You can flatten the hills, or fill in the valleys or even do both! The polish I bought is slightly abrasive and so ‘flattens’ the hills and the paint it takes off is rubbed into the ‘valleys’ and so it is smoother and gets a shine. I was told to try using two different kinds of polish. If I used wax polish, that would fill the ‘valleys’ and also put a layer of wax on the surface making it shine and hiding some pitting. This polish I bought contains resin to fill the ‘valleys’ and so even washing the car with ‘wash and wax’ will give it a better shine once I have polished the whole car.

Cleaning in the home

  I read a lot to research my blogs and I have a bottle of washing up liquid and I will read the label! It says it contains surfactants, these break down grease and make bubbles that scrub dishes clean. It’s ideal stuff for cleaning grease off dishes; but will also clean grease off the car or kitchen floor too; it has numerous uses.  I also checked the kitchen spray cleaner, surfactants again and bleach at 5%. I pay around 22p for 2 litres of bleach at 5% from the supermarket and know that I can put it in a spray bottle to use to disinfect and clean work surfaces and the bathroom. If I add a drop of surfactant it will also break up grease! Where can get a surfactant? The dish-washing liquid! One drop in a spray bottle and top up with bleach and I have a cheap kitchen cleaner and do the same in another spray bottle and I have a cheap and effective cleaner for my bathroom. Cool…

You can add the dishwasher liquid to you mop bucket to mop the kitchen floor with too and for stubborn stains use that kitchen cleaner in the spray. After I have cleaned the floor with dish washing liquid, I mop over again with clean water that I’ve added a little ‘wash and wax’ to; the stuff I do the car with. That fills in the ‘valleys’ with a little wax and it’s very thrifty because I got 2 for the price of 1 at Halfords!

The surfactant is also in washing powder but that makes fewer bubbles if it’s for an automatic. Washing powder is useful for cleaning some things; where grease isn’t a problem. If you add just a tiny drop of dish washer liquid to the washing powder it seems to make it more effective and you use less; but only a drop or you get too many bubbles.

There are other things that can be used to clean; fine ash can be used on some metals like silver. Fine ash is slightly abrasive and there are specialist cleaners that are abrasive and wear down the ‘hills’ of a surface and make the surface smooth and shiny. In the UK we have ‘Astonish’ which is very effective on white goods like the fridge and freezer. ‘Marvel’ is similar to ‘Astonish’ and many other cleaners can be mixed cheaply. The specialist cleaner for windows contains the surfactant yet again and vinegar (the acid helps to remove dirt) and of course water. I prefer the windscreen washer stuff I used in the car for cleaning windows and a scrim to use dry afterwards to remove smears or odd bits of cotton from my cloth.

You may like to read yesterday’s blog Coping in a Commune one of my better efforts, it was funny. If you were well off would you be happy? The wrote about the people of Richmond in Richmond – well off – but are they happy?  My blog Wealthy Brits – want to move abroad . Can you think of someone who would make a good role model; I struggled – Role models. There also lots more to choose from on the home page.

Thrifty Thursday, 9th June 2011

Energy

It’s Thrifty Thursday once again and earlier this year the Bank of England warned of higher inflation fuelled by higher fuels bills. It is the job of OFGEM to regulate the industry, ensure competition and keep prices down. It seems as usual ‘the lights are on but no ones home’ at OFGEM and first off with a whacking price rise is Scottish Power. I changed from Scottish Power last year and they offered me a much cheaper tariff and so I changed back. The price rise begins on August the 1st and is 19% on gas and 10% on electricity. They didn’t follow the other companies last time and put a smaller increase on gas; they are making up for it this time; a 19% increase is obscene and unjustified. I may really have to change this year! I have considered if I can reduce my energy usage further and short of covering my roof with solar panels; I doubt if I can make it more efficient. :(

Insurance

I may have to sort out my car insurance too and that could mean changing insurers. That went up around 40% last year; it comes down this year or I change. I shall also consider home contents; do I need it? I have never needed to make a claim and the only risk I perceive is that of fire and total destruction. I will consider that carefully; I did get a deal last year with my car insurance and so it was virtually free. I’m expecting them to try to rip me off this year. Home contents is easy to get and not a big deal and so I can shop around, cover is equally dodgy with all companies; my ‘collections’ (coins, stamps, etc.) are never covered.

Keeping up with the Joneses

 My neighbours have the same make and model of car as me but it’s a lot shinier and newer; I’m not keeping up. Am I? The depreciation on mine, over the 6 years I’ve had it, is around £300 a year. That’s not too bad… My neighbours have had 4 different cars and depreciation is around £3,000 a year. Then you add car tax, insurance, MOT, servicing, repairs and parking fines; then you realise how expensive it is! I’ll have a new cam belt, two hundred quid, drive carefully and make it last another six years. The mechanic says it will last longer than me!

The same logic applies to everything. I know I spend too much on technology but I need that! I might have a new TV for my bedroom; I found one on special offer with a USB input so I can do a slide show.  I usually watch TV on my laptop but the program keeps crashing the computer. I have given up most of my vices; smoking went years ago and alcohol a couple of years ago. I like my photography and use a little petrol going to places that are free to take pictures. This is a very frugal interest and if you’re in business, it’s a useful skill. It’s a good interest to put down on your CV to impress potential employers too.

 Second hand

 Most people would buy a used car because the depreciation on a new one is so high; but how about used furniture? I looked at classified adverts in my local paper and I would definitely buy used furniture. I actually considered looking at an old sideboard, it could be restored and it’s not difficult. I have restored wooden furniture before and it is simply a matter of scraping off old varnish, sanding it down and maybe using paint stripper on ornate parts; then re-varnish the piece. The inside is usually clean but can be painted with a dark emulsion if it isn’t. Wooden furniture before 1940 is usually good quality and well worth looking at. If it has an upholstered top like an Ottoman then that could be more difficult but stapling on a new cover isn’t that hard if you can get the right material. I have found markets an ideal place for looking for materials for upholstery and they have many other useful craft items.

Crafts

 That brought me nicely on to crafts and there are a lot you can learn; as varied as knitting to candle making. They can save you money and even make a few quid. Sewing is a big money saver; where can get even a pair of jeans turned up these days? The only place left appears to be the dry cleaners. I‘ve done candle making, not the ordinary white ones but fancy ones made in a mould or carved. You can get a kit to begin with and the same applies to making greetings cards that are less tacky than the ones you buy in the shops. There are groups at some community centres where you can learn crafts and of course check out adult education centres. If you only learn to cut and style your children’s hair at an adult education centre that can save you a small fortune.

Tomorrows is Frugal Friday and so check that blog update out. You may also like to go to the Home page and check out this weeks blogs – there are a lot to choose from. You can also read my Zopa blog for better interest rates on savings with peer to peer lending.

I spent a couple of quid on Wednesday on petrol taking photographs for my blogs; last of the big spenders!

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Thrifty Thursday Update, 2nd of June 2011

In the UK we have all kind of complex rules associated with tax and benefits. I’ve advised people on this subject and done accounts for business and I still get confused. It pays to try to understand all the complexity though. Today I tried to find out why banks don’t deduct tax at source on some accounts with a balance of over £50,000. It seems they will pay the interest on these accounts as gross. The interest does need to be declared and tax paid but it appears that filling a form in every 3 years and having the tax ‘assessed’ is good enough.

Moving on from the affairs of the rich to the affairs of the poor; I looked at savings tax credit. This can be worth more than £20 a week if you have saved for your retirement and are over 65 years old. I would like to give you more information but that appears to be a well kept secret too. I looked on the HMRC site and a couple more; not much information. It is worth applying if you think you qualify though. I did apply for that for someone when it first came out and the claim was successful.

I looked at a Farmfoods leaflet today. It’s not a good idea for me to recommend bargains because this blog is about being thrifty as a life style because bargains are country specific and I appear to have readers in a number of countries. The chicken is always cheap wherever you shop and on this leaflet the chicken drumsticks were a good buy at 2 packs for £6. That worked out at just £2 a kilo. They have put the bargain on the leaflet to get you into the store. There were some things on the leaflet like processed foods that weren’t a bargain. Anything processed like pies are a little suspect. Food manufacturers are quite skilled at making cheap food though. There are a lot of processed foods like chicken dippers, chicken bites and Chicken Kiev on the leaflet making use of chicken because it’s inexpensive compared to other meats. They do the same thing with turkey and you can too. If you are making a cottage pie, traditionally you use lamb; but why not try turkey or a mixture of minced turkey and lamb? I like to make cottage pies in foil trays and freeze them and then you have a quick meal without any fuss. I get the foil trays from Poundland and put minced or chopped turkey in the bottom with a layer of mashed potato on top. A little gravy on the meat helps to keep it moist in the oven.

 Photography

A lot of people have a digital camera these days and photography is a cheap hobby to have. I take photos for my Neodigital Art, but it can be useful to put photography on you CV as an added skill to impress potential employers. It is surprising how many employers will see this as a valuable skill to have. There are also lots of cheap and free places to go to take photographs.

Savings

 It is difficult to save with interest rates in most countries so low. I have a blog about Zopa and peer to peer lending based on my own experience with that type of lending. Many finance writers are now recommending National Savings and Investments (NS & I) index linked saving certificate that pays 0.5% over the rate of inflation; tax free. The rate of inflation taken is the RPI that takes into account, mortgage interest. This certificate is touted as a ‘great’ rate. The real return is 0.5% – not a great rate but better than being robbed blind by a bank robber! It is particularly useful if you are a tax payer and I would recommend it to higher rate tax payers. The certificate runs for 5 years and so it’s not good if you don’t wants to tie your money up.

Thank you for reading this. If you want a giggle you may like to read Exploding alarm clocks and killer cucumbers or maybe cliché. The latter one is particularly relevant if you use social networking. On the subject of social networking, you may like to share this blog with your friends by scrolling down to the bottom of the page (press end) and click the share button to share on LinkedIn, Facebook, Twitter or one of the other networks. Feel free to comment while you’re there or even ask a question. Ask a good question and I may even devote an entire blog to it. You can also subscribe to the comments or the blog.

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Thrifty Thursday, 26 May 2011

I could tell you about bargains to be had. I have seen some today like 4 chickens for £12 at Tesco and laptops for less than £300 at EBay and Comet. Being thrifty isn’t about just the odd bargain though; it is a way of life. It isn’t being stingy or mean but careful with cash.

I’m sitting in my kitchen writing this and can enjoy the aroma of home-made soup cooking; it works out cheaper than buying ready made soup and is a lot nicer. Cooking isn’t rocket science; it’s easy and saves money. I saw a lot of special offers on Tesco’s website and Asda’s website for barbecue food. This is pandering to fashion and those offers aren’t very good. The weather has improved since the snow of winter and it was really warm in April but is much cooler now; but people are dressing like its summer and having barbecues. I’ll wait until its a little warmer and I’ll wear a sweater when it’s chilly rather than use heating.

You can save a lot of money by ignoring the latest fashions; just because your neighbours are having a barbecue, you don’t have to have one. I have promised to entertain my family at some time over the summer and a barbecue is easy and relatively inexpensive. I have talked about a holiday in the past few weeks and I’ve surprised people.  I do practice what I preach and go thrifty and frugal all the time; but I save money so why not spend it on a holiday. I am thinking of Shakespeare country and taking photographs as opposed to a cheap fashionable holiday getting drunk and singing Karaoke! I will probably spend less money even though renting a cottage there is expensive.

The economy in the UK according to official figures hasn’t grown in the last year except for manufacturing. This could be because people are buying new smart phones made overseas and Lady Gaga music CD’s and the rest of the tat being promoted as being fashionable. She creates illusions or to use her word – delusions and people part with their money. It’s fashionable, innit…  I have no objection to her taking money from the chavs and the dreamless; but maybe we could do something to promote British singers, British commerce and British Industry. No; not the bloody Big Society…

My soup tastes delicious… :)

There are signs that the economy may finally come out of recession and so it is a good time to consider investments. When the economy is going into recession it’s a good time to buy commodities like gold and silver which have soared in price in the past few years. People have been eating out less and cooking more. This has seen some supermarket shares go up in price; particularly supermarkets at the ‘cheap’ end of the market. Morrison’s appears to be doing well but it’s the less expensive ones like Lidl and Aldi in the UK that have seen big increases in profits. If the UK comes out of recession which supermarkets will do well? I don’t think it will be the downmarket ones; quite the opposite. It could be a good time to invest in restaurants when people begin to feel better off and start eating out more; or maybe a pub chain? You may think investing in shares isn’t for oiks like us! We do have a capital gains tax allowance that can be used against gains on shares and so why let that go to waste. It appears over 90% of people in the UK don’t use their capital gains tax allowance and it’s over £10,000! You can also sell other things like a car and make a capital gain because cars are exempt from capital gains. I heard of someone a few years ago buying the odd car, valeting it and selling it at a profit to make a nice second income. I must get some polish for my car…

I could eat another bowl of that soup… :)

I think looking for bargains on-line is great and I have checked out supermarkets and EBay for bargains. It seems there are a lot of technology bargains to be had; but the products that are getting a little dated. Laptops that aren’t quite the latest technology are being sold off cheap; I have even seen one with Vista on it! Yuk! I’m not that happy with Windows 7 but Vista really sucked. I read about the Chrome-book laptops a while ago which will do everything on-line. I can imagine that, no power and you can’t do anything with them because your wireless goes off. I can imagine writing my blogs on-line. I researched something last month to do with Barratt Homes and they put a cookie on my laptop; everywhere I went on-line it was Barratt Homes adverts! It wasn’t just Barratt Homes’ adverts; they were showing me the development near my house! Imagine if I wrote this using Google Docs or whatever it is; I would be seeing soup adverts for months and if I mentioned holidays in a email using Gmail I would be bombarded with holiday adverts for Shakespeare country. I do admit though that advertising doesn’t have much of an affect on me even though I am very aware of it; I even read all my spam email.  It is thrifty to be aware of what companies are promoting in order to get bargains and to avoid the scams.

If you enjoyed this blog update, you may like to subscribe and receive an email next time I post a blog. You don’t get emails for updates and so you may like to click the banner and follow me on Twitter! Yesterday’s blog was to sleep; perchance to dream. You may like to read that… :)

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Thrifty Thursday, 19th May 2011

 I have written about the nature money for the past two weeks and particularly how its value decreases with inflation. It can help to understand statistics and odds. The odds of winning the lottery are very high but if you have a syndicate and put a lot of money on once a year; you can reduce the odds considerably. If you save a £1 a week and put £50 on each every year for one major draw and there are 20 people in the syndicate, you can cover 1,000 sets of numbers. This reduces your odds, but doesn’t guarantee a win. It is worth estimating or calculating the odds when you take out life insurance and other services too. The odds against you dying is reduced substantially if you keep fit, aren’t over weight and don’t smoke. If the odds against you dying are high then you should be able to get a good life insurance deal with a suitably low premium for the amount of cover you need. You should also consider the risks of other things normally covered by insurance. You need to have car insurance but you can save on home contents insurance. Do you really need it? What are the odds against you experiencing a loss and is it worth insuring yourself against that loss?  If you have sufficient capital it may be worth it; the insurance company makes a profit after all. You do have to consider all eventualities like breakages that you can probably cover and even a burglary; but can you cover everything? In the event of fire you could lose everything and that has to be considered.

The same sort of logic can be used to decide whether you need life insurance and how much. This is important if you have dependants, but if you have capital and investments; do you need it if you are single and have no dependants?

There a lot of services that we buy that we can save money on. Telecommunications including phone and broadband can be obtained cheaper usually by shopping around and making better use of what you have. Voice over IP is connecting using a service like Windows Live IM or Skype and it works well. I like Windows Live because VOIP doesn’t always work using voice over long distances and then I can use text very easily. I find my microphone is good locally and really clear; but there is loss of volume over long distances but I do chat to students in China a lot! You can also save money by getting a package deal. I have international calls, all geographical calls and broadband for just under £24 a month. I could change the plan and do without international but not everyone uses VOIP and so I’ll keep it for the time being. Skype out can be used for international calls and is reasonably economical. I also use my web space; I pay for it and so I use it! You can do a basic website with a free FTP (file transfer protocol) program and then use HTML and code using notepad. There are some good web design programs now and some are freeware. You can use a website to promote yourself to potential employers, promote a money making hobby, part time business or anything else you can think of.

 In the garden

 If you haven’t already started on the garden, now is a good time. I have had hay fever and still have a sore nose! I should have planted before now but it’s not too late. I‘ll put runner bean seed in trays. They can just go on the windows sills to germinate and will be ready to plant out in two weeks. The nights are still a little cold and after I have started them in trays or pots I will put them outside where it’s cooler to ‘harden off’. I have been buying fresh beans and they’re quite expensive. They are currently working out at £5 a Kg and I can get 1 Kg from the garden on a good day and of course I can freeze any surplus. They can be blanched before freezing but will freeze for a short period just washed and dried. They are better picked young especially for freezing and frozen quickly after picking. You can probably pick 10 Kg in a week in August and so that’s £50 in free veggies. That will save you money! There are lots of other things that are easy to grow and even tomatoes don’t need a greenhouse; just plant some seeds now in a tray and you’ll be enjoying fresh home grown tomatoes in August or even earlier. You can also make your own compost, either with a special compost bin or you can just dig a trench and fill it with household (organic) waste and then plant your runner beans in it. I’ll try to take photographs of the garden when I have runner beans growing.

Many people go out shopping in summer to spend all the money they are saving on heating and fuel. I pay for fuel all year around but there are some savings in summer as well as what I’ll save on fresh veggies. The car uses less fuel for example and you can dry clothes outside and that will save on energy. I know using a washing line may be a little old fashioned; but very frugal and you can have a cheap barbecue with the cash you save.

The most expensive thing people buy for a summer barbecue in their gardens is the drinks not the food. You can do the food quite cheaply if you prepare kebabs and do chicken drumsticks. Make sure you use vegetables and cook baked potatoes or oven chips too. The drinks can be made cheaper either by going for the supermarket deals and bargains or making your own. I would never buy a wine kit, the grape concentrates are usually inferior juice. If you make wine from the juice found in supermarkets it’s much better. It doesn’t have to be grape juice; apple juice and pineapple juice make good wines. You can make a nice Tropicana wine from orange and pineapple juice. This wine should be fermented quite strong and used as a base for punch. Make the punch by pouring the wine over a selection of chopped fruit and ice, then top up with a little lemonade for fizz. That is cheap and your guests won’t be disappointed.

You may like to check out the Frugal Friday blog update. I also wrote a couple of blogs earlier in the week; Windows Live was interesting, too scared to live, was about anxiety and the wise ones was a little humour… :)

Thrifty Thursday, 12 May 2011

I have written about the nature of money and the way it loses value as the Bank of England keeps issuing the stuff; I’ll try to cover inflation this week. It is important to understand money if you’re trying to be thrifty. I had my 3 monthly bank statement this week and I have been practising what I preach and so saved quite a lot. I reacted like most people and looked at a new television for my bedroom; we tend to spend when we feel well off. This is of course a mistake and so I didn’t buy the television.  I watch TV in bed on my laptop; but Windows 7 doesn’t like digital tuners and so crashes frequently. The cost of electronics drops all the time and so if I wait a little while I’ll get the television cheaper anyway; but I’ll still shop around. It’s fashionable to buy huge televisions that aren’t really needed except in a very large room. In my bedroom I don’t want anything bigger than 19 inch and they are  reasonably priced. It can wait and I always put off buying anything until I am sure I actually need it! The wait saves me a little money every time.

The Retail Price Index (RPI) in the UK is currently around 5.3%. This index is worked out using a basket of goods that includes mortgage interest, house depreciation, council tax, estate agents fees and other house purchase costs, television licence and car road fund licence. RPI also includes a price index entirely based on used car prices.

The   Consumer Price Index (CPI) is calculated on the same basket of goods but includes a few things that RPI doesn’t like student accommodation costs, stock broker fees and foreign students’ tuition fees.

The RPI and CPI are calculated differently, RPI is calculated using an arithmetic mean and CPI is calculated using a geometric mean.  This means that RPI doesn’t affect high earners and pensioners on benefits as much as everyone else because they aren’t affected by increases in mortgage interest rates as much. The same applies to the TV licence and road fund licence.

You can try to estimate you own Personal Price Index. This would need you to make a list of everything you spend money on and compare one year to another. If you saved some money on essentials like energy and then spent the money instead on a new television then you PPI would be lower then the official CPI or RPI. The same applies to saving the money and not spending it; putting it into a savings account. This lowers your Personal Price index, but you have to spend the money at some time. If you are saving for something that is going to be lower priced in the future like a computer, then you save money. Inflation devalues our money and it’s always worth bearing this in mind; especially when it can devalue the money we have saved by 5.3% each year!

I’m lending with peer to peer lending through Zopa, but even getting over 6% is only fractionally above RPI. I have one bank account with £10 in earning just 0.1% but it was a condition of another account. Banks will rob you in many different ways. If you are making less than your personal price index then you are effectively losing money in real terms.

Compound interest

If you don’t pay off your credit card every month or pay the minimum payment, the interest soon piles up as you pay compound interest; you pay interest on the interest. The reverse is true if you lend through Zopa, (peer to peer lending); as the interest comes in you can lend it out again and get interest on the interest and it soon mounts up. The £500 I put into Zopa last February will be worth £600 at the end of this month; but that does include a £50 introduction fee. It’s still good though, and a 20% return in 15 months. I shall invest more later this year now I have tried it out and have had no problems or bad payers.

VAT

VAT is normally at 20% in the UK; but 8% on gas and electricity. There is no VAT on basic food, children’s clothing, books, newspapers and magazines. The rules can be confusing; very small businesses may not charge VAT if they aren’t registered, such as a gardener. Fruit has no VAT; but fruit juice does. Children’s clothes have no VAT but children’s sweets do! If you buy a sandwich, its cold food and so no VAT but if you buy chips they are hot and so 20% VAT is added. Many fish and chips shops now charge £1.20 so you pay 20p VAT on a portion of chips.

Frozen vegetables are cheaper than fresh because they are always ‘in season’ and have no VAT and obviously it’s cheaper to cook you own food than pay someone else to cook it for you; there is also VAT on all take away hot food and on food in cafés and restaurants. I made home made soup with frozen carrots and swede that was £1 for 1 Kg which was about the same as fresh carrots at the time; but fresh does go out of  season and does need more preparation.

It can be useful to understand a little about VAT and other sales taxes just so you can try to avoid them. If you’re having an afternoon out in a park or nature reserve, you can take a virtual banquet for the price of buying a few hot dogs and drinks while you’re out. You can pack a picnic into a cool box or cool bag and make it healthy too. I would do chicken drumsticks and salad for two people for about a fiver with drinks. It is healthier and cheaper than buying food at a takeaway. I checked the price of fresh chicken drumsticks at 29 pence each if you buy two packs and so it could be quite a banquet with a few more goodies like iceberg lettuce, tomatoes, frozen prawns, cheese and other goodies. In fact you would have enough for several banquets but would need to spend about £10 to get the lowest prices. The iceberg lettuce keeps for a month, the chicken will freeze and so you can have a few picnics out for a tenner, even if there is a family of you. I’ll have the 20 drumsticks and the prawns – fancy a bit of lettuce? :)

You may like to read the Frugal Friday blog, I’ll be posting an update as usual on Friday! Earlier this week I posted a blog about Oiks and Toffs, which is quite funny, if you have a sense of humour. I have also done a Neodigital Art update with some nice pictures.

There are also some cooking tips on the Food page. I will do more on that page this summer. I intend to do salads and barbecues. I’ll use the chicken drumsticks left over from the picnic for the barbecue… :)

Please comment, subscribe, follow me on Twitter or recommend me to a good editor! :)

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Thrifty Thursday, 05 May 2011

 Saving is for Suckers?

Thrifty is about spending money wisely; frugal is more about being economical and not wasting money or anything else you have paid good money for. It helps to understand what money is and how it can be devalued. A good history of money can be found with the information available about the pound sterling on Wikipedia. The pound was one of the first currencies over 900 years ago and it’s worth looking at that. It appears that the coins were introduced over a thousand years ago and the early silver pennies were a copy of currency introduced by Charlemagne. There were 240 sliver pennies and these are reputed to have weighed one pound. Hence the term a pound and the inscription on the old pound notes ‘We promise to pay the bearer the sum of one pound’; the original note was a type of bearer bond, payable in silver coin. There would have been 15 small silver coins to an ounce and the shilling that was introduced later would have been 12 coins. King Henry II devalued the coin by introducing what became known as sterling silver at 92.5% silver and the currency has been devalued by Royalty and governments ever since. The current devaluation is done by the Bank of England; not debasing the coins which are base metal anyway now but by printing more and more money. This is done by yet another King, Mervyn  King; the governor of the Bank of England. You may like to visit their website where they detail all the recessions that there have been as a result of constant devaluation of the currency. They invite you to play a little game of adjusting interest rates to ‘keep’ inflation at 2% but don’t ‘play the game’ themselves. Inflation is over 5% (RPI) and still there is no increase in interest rates. Money is being devalued like never before with quantitative easing and no one complains. In the past this would have meant the unions asking for pay rises to compensate for the increase in prices; but they now need a ballot to take industrial action and so what is the point when union members are struggling to pay off debts?

That is how you control people; you keep them living in fear by keeping them living in debt. The banks supported by the government made credit and mortgages easy to get and even this morning I saw an offer from First Direct to remortgage at 1.99% that is a tracker and 1.49% over base rate. This is effectively an interest free mortgage with money being reduced in value by over 5% per year. It is cheap money for a rich property owner who can invest it and get a better return. The stock market can be very lucrative if you borrow at just 1.99% and get a discount on shares like many big investors do.

You may be asking what the point of saving money is. There is little point if you have property and can invest in property and speculate with buy to let mortgages. It does give you some emotional security though to have money saved and this is why people are encouraged to live their lives in debt. The rich and politicians prefer people to be financially insecure, they won’t complain so much and won’t take industrial action. They will be willing slaves. The average annual income per household has been put at around £33,000 a year and average wealth at £275,000. How does a household on £33,000 manage to save £275,000? They buy a house for £10,000 and then wait for 40 years for money to be devalued and their home to ‘valued at’ £275,000. They are ‘rich’ but can’t sell the house because they would have no where to live and find themselves too old to enjoy the money anyway. They scrimp to pay the mortgage and then retire and have to scrimp to live. The Bank of England has cheated them out of the option to save for their retirement; unless they actually worked for the bank in which case they probably have an index- linked pension. Calls to end index linked pensions did get a response from a union chief – John Edmonds, general secretary of union GMB, said: “We could be looking at the biggest pension rip-off in history.”

Read more: http://www.dailymail.co.uk/news/article-127364/Review-calls-index-linked-pensions-scrapped.html#ixzz1LUE5fC4q

He failed to mention that people are already being ripped off as many firms can’t afford to pay indexed linked pensions; some have raided pension funds and stole money and even local and national government are trying to back out of obligations.

You obviously can’t trust union leaders, government or banks. I have written about social lending with Zopa and I get an interest rate that works out to above the inflation rate. I have to make allowances for bad debt but I’ll still get 6% which beats RPI by a small margin. It is way better than getting ripped off by the wealthy and I am helping people who borrow to get out of the debt traps that banks offer. Most bank lending is well over 15% on credit cards and some if as much as 40%. It gives me some financial security and I’ll put more into Zopa this year. Being Thrifty and Frugal means you have a personal inflation rate that can be much lower than the retail price index (RPI) or the consumer price index (CPI). If I am thrifty I can avoid many of the price rises and keep my personal inflation rate at around 2% (ironically the Bank of England target); this includes not spending some money and savings it. I also like compound interest which can be a nightmare if you only pay off the minimum on a credit card; but can be handy for a saver. We get interest on the interest and I constantly reinvest my interest and the capital that has been paid back through Zopa. I put £500 into Zopa as research last year and now have £590 which includes a £50 introduction fee and so I’m happy to put more in. Zopa goes from strength to strength and I have had no bad debts. The rich have big debts and like the banks they are too big to fail; if you owe £5,000 you have a problem; if you owe £5 million – the bank has a problem.

I hope you understand how money is constantly devalued by the Bank of England now and you may like to read the Frugal Friday blogs – another will be posted tomorrow. There are other blogs to interest you like the social media blog and the secrets of success.  There is more information about Zopa here.

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Neodigital Art - Power to the People.

Thrifty Thursday, 28 April 2011

Today’s picture may seem unusual but it is the unusual that interests people! My friend is getting interested in Neodigital Art and asked about printing the pictures and an exhibition; it is important in any venture to be thrifty and frugal. We have to get more people interested before we begin to spend money on printing the pictures. I am getting a lot more people interested in this style of Neodigital Art and my friend actually likes taking photographs of the unusual as opposed to the scenic, pretty pictures!

This week I have been very busy but I have found time to look at advertising. A Farmfoods (they sell frozen food in theUK) leaflet two weeks ago was promoting chicken thighs at a good price. The leaflet this week promotes breast steaks and drumsticks and the price per kilogram is higher. The boneless meat is price higher obviously but drumsticks are m ore popular for barbecues and the weather is better. We also have a ‘Royal’ wedding tomorrow with celebrations and barbecues. The weather affects pricing but the best pricing still goes on the leaflet and they promote whatever they can increase sales of. The chicken thighs are still probably on offer but are less popular for barbecues. They may be a bargain but I can save more on multiple offers. The chicken breast fillets are £4.50 or 3 for £10 and so the multiple prices work out cheaper. It is even cheaper if I use a coupon on the leaflet to save £2.50 when I spend £25.00.  These savings mount up when added together but obviously the chicken has to be stored and so you need a freezer. If you bought the multiple packs and spent £25 to get £2.50 off; you save a third of the cost compared to buying a single pack.  Buying 9 single packs at £4.50 would cost £40.50 but with the offers this comes down to £30 and then the £2.50 coupon reduced it even further to £27.50; a saving of £13. The £13 will pay for the oven chips, vegetables and money left over for a pack of beer!

I live in an urban area in central England and so have a good choice of retailers but I could still use a lot of fuel shopping around for the best prices. I can get a good idea of pricing policy of the major shops and shop at different ones each week. Farmfoods and Iceland are frozen food specialists and have stores just ½ mile from my home. The supermarkets are a similar distance and I have a choice of Morrison’s or Asda (Wal-Mart); the difference between the supermarkets isn’t that much but I prefer Asda because they do more non-food items and that saves me shopping around for those. I don’t even consider Tesco because although only about 4 miles away, the fuel cost would impact on any money saved.  I look at Farmfoods and Iceland for frozen foods mostly, then Asda and sometimes Morrison’s if I am travelling their anyway.  The fuel price makes it unwise to make a special trip most of the time; you don’t save any money.

Obviously, buying multiple packs is easier if you have a family, but you can always consider asking friends if they will share. I often share multiple packs of crisps (potato chips) for example. This is particularly thrifty for students who can share lots of things. You can also look at sharing when taking a vacation or sharing a car.

Planning is vital to being thrifty. When we went to take photographs on Sunday we went to five different locations. I planned the route and we left the car and walked between two locations. I often go to the ATM to get cash on the way and even stop at a few shops if we are passing to buy only what I need; not what I want!

I’ll post my Frugal Friday blog tomorrow and my secrets of success blog is popular if you haven’t read it!

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You get exercise without joining a gym and get great pictures if you look for them

Thrifty Thursday, 21 April 2011

Here in the Heart of England it’s 13 centigrade today; the sub zero temperatures have gone! The great thing is the heating is cutting off on the thermostat nearly all the time and now we can save some money for next winter’s heating bills.  I saved money on gym fees earlier in the week by going out and taking photographs. I have lots of aches and so I must have got more than enough exercise.

We found so much to photograph it was difficult choosing one for this blog. Digital photography is so thrifty if you don’t print the photos but share them on Facebook or like me on blogs. I also put them on a sky drive. Skydrive is online storage to store and share 25 Gb of space and if you download the Windows Live suite of programs you get a bunch of programs free. I talked to my sister using Windows Live Instant messenger the other day for the first time and she found it easy. I could also easily show her the photographs I had taken. I also chat to the students I help in China and even look at the photographs they upload to QQ.com (the Chinese equivalent of Facebook). I also like the photo software that comes with Windows Live because it’s easy to use and allows me to level up photographs. The movie software and blogging software is useful too but I use the instant messenger most. I even downloaded an add-on this week for the photo software to do a collage.

In the garden

I have started mowing the lawns and that added to my aches and pains! There is a collection service for garden waste and it may be useful for weeds; but why throw away grass cuttings? They are so useful. My lawn grows fast because the soil is very good; I compost the grass cuttings. You can dig a trench in winter and fill it with kitchen waste anything that will compost and then plant runner beans in it as soon as the frosts have gone in May or June. I think I will plant beans very soon and plant them out in May to ‘harden off’. If the weather goes cold and kills them; I’ll have some as a back up! They grow vertically and crop heavily and so they are excellent; they taste good too. They say runner beans count as a super-food because they contain so many nutrients and in the right quantities. I may grow other things like salad. I have seeds to start an herb garden this year; I don’t seem to have much success with herbs and so will try them in containers this year. If you don’t have a garden try growing in a container or window box. Every little helps!

Zopa

I usually write a lot of blogs in a week, but this week I have only done one; an update on my Zopa blog. I have been doing research for another story and doing collective information analysis (getting a lot of people’s opinions and reading them). I estimate my return on my peer to peer lending with Zopa will be better at 6% on the money I’m lending now and of course I will still get up to 8% on money I have already lent out.  I can also increase my interest rates if the Bank of England ever decides to tackle inflation and increase the base rate.

Social Media

Social media is Windows Live, LinkedIn, Facebook, etc and the hot topic now. I have been using it to research a story this week. LinkedIn members are kindly contributing opinions. I also wrote about improving you career with social media last week. You may like to read Social media – Career enhancement  or maybe social media – cascading the portals. I also wrote The Secrets of Success last week; I must read that one myself! :)

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Neodigital Art - it cost me a pound for my afternoon out!

Thrifty Thursday, 14 April 2011

Supermarkets

My local supermarkets here in England are Asda (Wal-Mart) and Morrison’s; Tesco is too far away with the price of petrol (gasoline) so high. I read a lot about shopping around; but is it worth it? My car costs around 15 pence a mile to run on average and more if it’s just a short run to the supermarket.

It is worth looking at the supermarkets policy on pricing though.  I looked at Morrison’s prices and Coca Cola is buy two get two free; this tells me that they load prices. They load the price of Coca Cola so it’s priced high for a short period and then do a deal with the company for a discount and put it on special offer. The special offer asks you to buy more than you need and this probably contributes to obesity as people buy more than they actually need. It is worth looking at these special offers and buying but not consuming more just because you have a stock in. The goods that get this price loading treatment and those we have begun to view are necessary and even staple foods. They include tea, coffee, soft drinks and any goods that you buy regularly. Your favourite shampoo, washing up liquid or soap powder will creep up in price quite quickly until the price is doubled. You don’t shop around because that takes time and fuel for the car; you get ripped off! You can use this price fixing to your advantage by stocking up on products while they are on offer. There are some products that it is wise to avoid if you can; the biggest rip off today was Easter eggs, unless you buy several. The supermarkets also load the products your kids want most; today at Morrison’s, one brand of children ice cream is ‘half price’ which basically means it was a rip off last week.

Uncommon sense

I began today’s blog with a picture. If you are a regular reader you know I digitally alter photographs for my Neodigital Art; that very exclusive school of Art that is so socially inclusive anyone can do it. My friend and I took photographs for that on Sunday but on Tuesday ended up going our separate ways; I went to one location and he went to another. I worked out the cost of petrol; he went 25 miles and spent £4.00 on fuel. I went around 5 miles and spent £1.00 on fuel. It is quite common for people to drive miles to get what they want and that is why the roads are so congested. The grass is always greener somewhere else and the sun is always hotter in some other country. I am always amused when people come back from a holiday overseas and are surprised that we had better weather here.

I am quite happy with the photographs I took the other day. I need unusual photographs, not nice scenes. My thinking was uncommon and sometimes you have to think laterally to save money. One of the biggest problems we have in Western cultures is stress. We appear to be driven to compete with one another in education, work and even driving. Some drivers appear to be quite insane to me and unaware of the dangers. They also appear to be totally unaware that their cars are fitted with indicators. How does society cope with stress? People use drugs, cigarettes and alcohol to cope. The latter, is one to avoid now if you are driving and so the stress of driving is even worse.

The thrifty and frugal way of life can reduce stress and increase emotional security. It is very stressful being in debt or short of money and so adopting this life style can have a calming effect. People commit suicide because of stress, they get divorced because of stress; they argue because of stress – there is an alternative. If you have a family, it is a good idea to discuss with them having a frugal Friday every week; when you eat something frugal like egg and chips! Some people actually spend more money on a Friday because traditionally, that was when people were paid.

You may like my recent blogs, the secrets of success; social media – career enhancement; social media – cascading the portals and there was the usual Neodigital Art update.

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Which is best? Notes or Coins?

Thrifty Thursday 7th April 2011

Last week I wrote about the nature of money. I welcome comments and Rob commented on that blog and my blog about the dreamless ones! Even if you disagree with me, I still welcome comments. This was Rob’s comment:

“The Government prints only 3% of the total money supply. 97% is created by the Banks – these are official ONS figures. Inflation is created by a variety of factors, in particular perception. If I think I can charge more for a good/service and still sell the same amount, I will. If I perceive others are doing the same and my costs are rising, I’ll continue doing it.

The money supply is irrelevant.”

This called for research despite the fact on the bank notes it says who prints them and that the Bank of England issues them! I took at look at the Office of National Statistics (ONS). I found this quote:

F.21 Currency

“This covers domestic (that is, sterling) and foreign currency notes and coins, and gold held by UK MFIs.

Sterling currency notes are a liability of the central bank, while coin is regarded as a liability of central government. Coin is issued by the Royal Mint, but Bank of England notes are issued by the Issue Department of the Bank of England, which is part of the central bank sector. The Bank of England holds securities as backing for the note issue. In the accounts prior to 1998, the note issue was a liability of central government and the Issue Department was treated as part of central government. The flows data for central government relate to net issues of coin less holdings of notes and coin by central government for its own use. The figures for the monetary financial institutions sector relate to issues of notes by the Issue Department (liabilities) and by Scottish and Northern Ireland banks and changes in holdings of sterling and foreign currency notes and coin (assets) by the sector.”

So the Bank of England does the paper or their equivalents in Scotland and Northern Ireland and the Royal Mint does the coins. I have forgotten which company actually does the security printing. I think it’s still De La Rue, they bought the Bank of England’s bank note printing operations in 2003. The Bank of England became an independent organisation in 1997 but is still owned by the government and the governor reports periodically to the chancellor; so is independent in name only. Incidentally, MFI’s are Monetary and Financial Institutions not dodgy dealers in flat pack furniture… :)

I would write about M1, M2, M3 and the various forms of money and why bonds are paper and can be exchanged for more paper – but who really cares?

Petrol (gasoline)

In the UK petrol is sold by the litre. I checked US prices; I thought they were expensive until I realised it was in gallons! I worked out my car; on a run, will cost around 10p a mile in fuel and around town this can go as high as 20p a mile. The petrol station 5 miles away is 1p cheaper than up the road. It would cost me up to £2 to get there and back; it’s hardly a good run. My car holds 60 litres of petrol and so the most I could save would be 60p if I filled up.  I think shopping around for petrol is not a good idea and even queuing at Morrison’s because it’s a penny cheaper than Total doesn’t appeal. I will use Total though; they are reasonable and close by. For the benefit of US readers it’s over $10 a gallon; so stop moaning! :)

Light bulbs

I’ve researched light bulbs. There are incandescent, halogen, fluorescent tubes, the small fluorescent bulbs and LED (light emitting diodes). The LED’s give a harsh white light, they are stupidly expensive and no one appears to stock them except online. The incandescent ones get hot and use too much electricity and don’t last long. The small fluorescent bulbs are useless because they are too dim except for decorative purposes.

I studied electrical science and qualified and so will give you an opinion, devoid of bovine excrement. The halogen are reasonably priced and save about 20% on energy; the fluorescent tubes save around 40% on energy but are only really suitable for kitchens and bathrooms. I have a 5ft fluorescent in my kitchen at 60 watts and it saves 40% on electricity because it’s on 11 hours a day in winter. The bathroom has a circular fluorescent and again saves about 40% on energy cost. For decorative wall lights that usually take a 40 or 60W bulb; I would try the fluorescent bulbs, but if they don’t fit, then try 15W pigmy lamps – they give as much light as a 40W and seem to last forever. I can’t tell you how long they last, but I have never had to change one!

Holidays

There is enough written about foreign holidays and I want an interesting holiday. I thought somewhere nice in England, nice scenery, maybe a few nice pubs, theatre and somewhere to take a lot of photographs for my Neodigital Art. I found a cottage with Broadband connection; I need internet! The other option was Travel Lodge that seemed reasonable. It seems there are a lot of log cabins for rent too. I like the cottage out of all the options and I was surprised at how many lock keepers cottages are for rent; they would be good, they would satisfy my obsession for photographing canals too! If you’re in the UK, a cottage is around £400 to £500 depending on the month and it’s more when the kids are off school. You can save obviously by sharing. If you’re visiting England then this is an excellent choice because I found one 200 yards from Anne Hathaway’s cottage; you get history and culture thrown in for free. You can also grab a pint with the actors from the theatre. You can of course enjoy fishing on the river Avon; with a licence.  I gave a few tips yesterday in my blog on Neodigital Art; I would take photographs if I had a holiday in Shakespeare country. :)

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I remember when a family would live on that fiver for a week – now I would need the gold sovereign…

Thrifty Thursday, 31 March 2011

I want to write about the nature of money today, because many people don’t quite understand it. The government uses fancy and confusing terms for the money supply like M0 and ‘broad money’ but imagine if the government only ever printed money to replace that which was worn out. Money would be in short supply if traders and companies kept putting up prices.  Then as money became in short supply companies and traders would have to cut prices as much as possible to sell their products. There would be no inflation and it follows therefore that inflation; the devaluing of money, is caused by governments printing the stuff. The official inflation rate in the UK last month was 4.4% and the RPI (retail price index) was even higher. It seems likely that inflation is really around 5% and so what costs £1 today will cost £1.05 next year, as our money is being devalued by the government printing money.

Now imagine that you knew in advance that the government was going to devalue money overnight and you had a night out planned; down the pub. This is a hypothetical situation but bear with me. Let us say you go to the pub with 4 friends and borrow £10 from a friend and get 5 pints of beer for £10 and then next week you give the £10 back to your friend and say thank you very much. You borrow the £10 because you know the value of the pound is going to drop quickly and the price of beer will go up 10%. Your friend has his £10 back but it’s his turn to get the beer in! It now costs £11.00! The beer is the same; the money is the same, the value of the money has dropped. This is called shorting and dealers in hedge funds do it all the time and make millions. Hedge funds ‘borrow’ shares and when the price drops they make a profit. Some years ago, George Soros borrowed pounds and when the British government suddenly left the European exchange Rate mechanism; he made a fortune because the pound was devalued. The ‘price’ of the pound against other currencies dropped.

The value of currencies can be measured against the price of commodities like beer and valuable commodities like gold. It can also be valued relative to other currencies. If we look at the price of gold, it has soared from $250 an ounce to $1,400 and people are buying more. I mentioned in a previous blog that owning a few gold coins would be useful as a reserve when travelling, particularly overseas. The SAS (special air service) carry gold sovereigns as a reserve currency in money belts; it’s accepted in more places than American Express and most of the world’s population recognises it’s value.

The US dollar is the world’s reserve currency but when Britain was wealthy and had an empire the pound was the world’s reserve currency. Since then the US has taken over as the world’s most powerful nation and Britain has gone through a few financial crisis’s. I can remember inflation over 20% and the ‘winter of discontent’ as workers tried to get pay rises to match double figure inflation and some pundits are forecasting this will return. They are particularly worried that it will happen to the United States because the government is in debt to the tune of trillions of dollars and governments like that of China are holding a lot of paper that becomes less valuable all the time. China and other nations have asked if it’s time for a new reserve currency perhaps made up from a basket of currencies. If this happens and the US dollar isn’t considered valuable enough to be included then hyper-inflation could take off in the United States.

The pundits who are forecasting an economic doomsday scenario are partly right because the rich will try to protect their wealth and are already doing so by buying up gold. Do you have scrap gold? The rich will buy it! They will also buy futures in oil, gold, silver and all other commodities including food and this will force up prices of essentials as the rich protect their wealth by hoarding commodities. If the doomsday scenario plays out; the traders farther down the economic pyramid will hoard. This has already happened in countries like Russia where there was a drought and food shortages.

It seems prudent and thrifty to save as much money as you can but also to bulk buy when possible and look at what commodities that you can buy as insurance against hyper- inflation, should it come. Even double digit inflation like I have seen in the past will take it toll; it will give you less money to spend on luxuries. You will have to spend all your money on essentials, like food and energy. If you have a freezer full of food and your cupboards are stocked with canned food, this will help. If your home is insulated it will be easier to keep warm as energy prices increase by as 25% or more; we have already seen energy prices rocket because of recent ‘quantitative easing’ (printing money) and big companies hoarding. When inflation was over 20% in the UK, interest rates on savings went to 12% and higher. With inflation higher than interest rates savers were robbed; but at least they had some money to get through the bad patch. People in debt saw the real cost of debt go negative. Money was being devalued at a faster rate than their interest rate; which was fine as long as they could hold on to a job, but many didn’t and went bankrupt. They tried to maintain the life style they were used to, the fashionable clothes, the cell phone, the car, the house, the nights out and the cigarettes. I know people who are living in social housing who once owned property and are still bankrupt many years later.

There is VAT on silver, inflating it’s price or I would be buy silver because it’s a useful metal for industry and the spot price appears to be low. I have bought gold coins and will be looking at other commodities. This country isn’t broke as the politicians would like you to believe. Those buildings that are worth trillions of pounds throughout London and major cities are owned by the rich who will not sell, even if the poor are starving; the rich will hold on to those assets. It happened in Victorian times as the rich profited from the industrial revolution and slavery; the poor relied on the workhouse and charity. Now they profit from technology and slavery in the form of the minimum wage. You can deprive them of some of your money by being thrifty and frugal and acquiring some commodities. If you take control of your finances, you take control of your destiny.

If you need a laugh you may like to read a previous blog “The Dreamless Ones” or just take a look around the Neodigital Art blogs are interesting too. Tomorrow I’ll post my Frugal Friday blog!

Thanks for reading, you may like to bookmark the page or follow me on Twitter and comment are welcome…

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Neodigital Art - all you need is a computer and a digital camera; get involved...

Thrifty Thursday, 24 March 2011

It’s Thrifty Thursday again and as I have said in previous blogs being thrifty and frugal is a life style and should apply all of the time.

Yesterday was budget day in the UK and the chancellor made his speech and set out spending cuts and taxes for the next year. It is nothing to write home about! The main change that I approve of was the personal tax allowance increase, up £1,000 to £7475 and that will go to £8,105 next year. It is a step in the right direction and after taking so much from people with a rise in VAT it was the least he could do. They will keep rising that until it hits £10,000 a year. He is increasing tobacco products by 2% plus inflation which is to be expected. It would appear some money will go in at the bottom of the economic pyramid but most will be at the top with huge bankers’ bonuses.

It is worth remembering that everyone also has a capital gains tax allowance of £10,100 and so in theory you can make over £17,500 a year tax free. In theory…

You are liable to capital gains tax on anything you sell and make a gain; this would normally be an investment like shares but can be an antique or even a copyright. Capital gains tax doesn’t apply to most possessions where you usually make a loss like your car or household furniture; if it did you could claim that loss against capital gains tax. This means if you make a profit (gain) on your car it is tax free, if you haven’t used your allowance. I knew someone who bought the occasional car; cleaned and polished it and then sold it and made a tax free gain. It is an idea worth considering. The same can apply to household furniture and I have done that! :)

The rules on capital gains apply in most countries but if you’re outside the UK you may have to check the allowance that applies to you. You can get a problem on capital gains when it can be difficult to decide if it is a gain or profits from the course of business. If you do a car boot sale and sell off all you unwanted things; it’s a gain. If you do a car boot sale every week it may be classed as a part time business.

Saving money is of course tax free and I went taking photographs again on Sunday. I look for ‘hidden’ places that I don’t have to drive too far to. I have included one of the photographs on this blog. The river in the photograph is hidden away because the road leads to the river but nowhere else. It is out of the way because it isn’t a place I would normally pass. I actually thought there was a canal there. We discussed doing tours to all the hidden places we go to and I even use Street view and Google maps  to find these places. I worked out my car now costs around 20 pence a mile to run around town and so we spent £2 on fuel for an afternoon out. I did spend another £7 in the supermarket and I only went in for eggs! The delicious smell of fruit got to me and then I saw bean sprouts. I did notice the price of toilet rolls has gone up a lot. I must stock up next time they have a special offer!

My friend went out again on Monday taking photographs and went farther afield and didn’t get such interesting shots despite travelling over 250 miles. The point is you don’t need to travel great distances usually unless you live in the middle of a desert or somewhere very isolated. There is a tendency to believe the grass is greener somewhere else and the chips taste better at a motorway service station or McDonalds – it isn’t true.

You can find lots of free places to go like libraries, museums, art galleries, parks, nature reserves and they usually allow you to take photographs. It can be a good idea to do lots of days out instead of a vacation and then save the cash for a better vacation; it is environmentally friendly and you get to go somewhere really nice instead of a cheap hotel and a crowded beach.

I also promote my Neodigital Art and I got some good photographs for that. I also send photographs to friends who ask for them. I was asked today for photographs by a friend who will re-post my social media blog from the other day on her website. I also email some to an artist so she can draw sketches from them.

There are lots of ways to save money and lots of ways to make money and when you have saved a little; you can invest. I changed the interest rate on my Zopa lending this week and now hope to get a return of 6%. This is a real return, above inflation that is probably running at 5% now; the latest figure was 4.4% for February. That means the value of our money is going down by 5% a year; that is fine if you are in debt like the government. It is unfair if you are thrifty, frugal and responsible with money and save.

Please bookmark my blog or follow me on Twitter.  Frugal Friday tomorrow… H for Holidays…

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This image wasnt digitally altered very much, just enough to make it more interesting

Thrifty Thursday,

Thursday, 17 March 2011

It is Thursday again and so to another thrifty blog. If you aren’t used to WordPress blogs; this one is on a page of its own and if you scroll down there are thrifty blogs from previous weeks. On the home page I can do what are called perma-links and you click the title to just get the blog you are reading or click more.

I wrote an update to my Neodigital Art blog this week after taking more photographs for it on Sunday. That was a thrifty day out, we went to five locations; I took 150 photographs and used less than one litre of fuel. Neodigital Art is very thrifty and frugal because it is about recognising the images that are there on your own doorstep. You just photograph them and it’s very social too because like the Parisian artists who began the impressionist movement, we can then share the pictures and talk about them. I used Facebook to share the original photographs and then digitally altered them to use on my blogs. It was an inexpensive afternoon out, anyway.

I was planning a holiday and when you have been thrifty and frugal as a life style; you can afford a decent holiday. I was planning a luxury hotel and a little extravagance; but I would really prefer a holiday taking interesting photographs. I like scenes, even industrial scenes, canals, rivers and buildings. I suppose I could find something interesting to photograph on a beach somewhere exotic; but the hot beach babes might object! :)

The point is you can afford what you really want if you live a thrifty and frugal life style. I think I would like the English countryside and so will consider that; maybe I can leave the frugal life style behind for a week or two; then again, maybe not.

ISA’s and bank rip offs.

I mentioned last week that the rich invest in funds and ISA’s weren’t attracting too much money; relatively speaking. The top ISA (individual savings account – tax free in the UK) I found paid 4.5% if you tied your cash up to a fixed rate for 5 years. I have seen double figure inflation and I’m not that stupid. Interest rates will rise and I will then put my Zopa rate up which at the moment will probably get me around 5%. I did get close on 8% over the past year but had to drop my interest rates. I can just as easily increase them when rates start to go up. The Bank rate will go up and Zopa advertising will stimulate demand which will help. There are similar social lending schemes in other countries (Google, peer to peer lending). I checked the rates at the Halifax and the ISA interest rate was just 2%; that is pathetic. The Halifax guaranteed reserve account paid 3.35%, but taxable. If you invest £10,000 in the ISA you get £200 interest tax free; in the guaranteed reserve account you get £268 with tax deducted. I think many savers are baby boomers who don’t pay tax who may prefer the £268 and then claim the £67 tax deducted back. I would prefer though to put the £10K into Zopa and get £500 in interest (gross) and that wouldn’t be fixed. If rates go up, so does your interest.

I found lots of confusing accounts at all of the banks; how many do we want? I only want a current (checking account), instant access account and a high interest account at most. They deliberately confuse and who can blame them? I said in my ‘Daylight Robbery blog’ that Bob Diamond, CEO of Barclays got a £6.5 million bonus; the customers and shareholders pay for that. Barclays offer pathetic interest rates and charge 16.9% on the platinum credit card and if you want to go up market to a Gold card, the rate is an astonishing 19.9%. If you transfer a balance to the platinum card, a 2.9% handling fee is charged. If you transfer to a Barclays Simplicity card there is no handling fee and a ‘great’ rate of 7.9%. There are conditions of course. Your debts excluding your mortgage must be less than 10% of your income and you income must be over £20K (gross or net?).

If you are still struggling to make thrifty and frugal part of you life style; keep accounts and monitor all of your spending. The important things are essentials and everything else is a luxury. I don’t have cable television or satellite; I have Freeview digital and I can record onto a hard drive with a press of a button. I also have Freeview on my laptop; by plugging a tuner into the USB 2 port. I have been tempted by a phone that connects to the internet; but I use my laptop nearly all the time and need a break from it sometimes. My cell phone costs virtually nothing. I have a cell phone so people can reach me when I’m out and I can make a call if my car breaks down; it hasn’t in 6 years but why take the chance? I will spend money on my car soon for a new cam belt; prevention is better than a £500 bill if it breaks. I have no intention though of buying another car just for a status symbol. Trying to ‘keep up with the Joneses’ and staying fashionable can be very expensive. You look back at your attempts to be ‘fashionable’ and you find clothes in your wardrobe and you wonder why you ever bought them. I have neighbours who change their cars regularly and the amount of depreciation alone is enough to feed a family in some poor countries. This constant renewal of all our possessions also takes a toll on the environment. At the time of writing people are worried in the wake of the Tsunami in Japan about the environmental concerns of a nuclear meltdown. I am surprised that people with a long future ahead of them or people with children or grand children aren’t worried about the unstable weather that appears to be a result of climate change. We need to create goods and services with a small carbon footprint and make manufactured goods better designed and more durable. The governments of western nations could follow France’s lead and make longer warranties on goods a legal requirement; in fact rather than 2 years like France; why not 5 years?

I’ll be updating my Frugal Friday blog tomorrow and it is G for gold, grants, goals, etc in my quest for a complete A to Z of frugality! :)

People who read my Thrifty Thursday blog last week also read It’s Daylight Robbery, so if you missed it last week – check it out this week! :) If you’re in the UK check out Poundland for bargains! :)

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Thrifty Thursday

The rich put their money into funds (billions) and encourage us to put money into ISAs (millions)

Thursday, 10 March 2011

Thrifty Thursday

I read all the time about how great ISA’s are (Individual savings accounts – tax free in the UK) but as you can see from the graphic; the big money is going into funds not ISA’s. In December funds stood at £577 Billion up from $480.6 the year before and ISA’s stood at just £120 million. To put that into some sort of perspective that is about £2.00 for every man, woman and child in ISA’s and the rich meanwhile have close to £10,000 for every man, woman and child stashed in funds and stocks and shares. The wealthy also have trillions stashed in private companies, property, land, oil, gold, silver, diamonds and other assets. This country is so broke it makes me weep!

That is just to get things into perspective and you can now see why thrifty is so important. If you waste money; it just goes to make the super-rich even richer and you even poorer; not that many people are really poor and begging on the streets in developed countries.

I put some petrol (gasoline) in my car in January and I am still using it. I know people who put fuel in their car every week. I admit I filled it to 60 litres; but then I drive fairly frugally and don’t make unnecessary journeys. I went to hospital that day and I’ve been back since and I went shopping a few times and out taking photographs. I still have over 50 litres of petrol. So why do I use so little? My friend wanted to go to a beacon about 5 miles away to take photographs (a 10 mile round trip). I thought that it would be boring, a great view from up high, of fields and the odd cow; but boring. We went 2 miles and took photographs of a canal, industrial landscape and a park; you can see some of those images in my Neodigital Art blog.  The problem was that the grass always appears greener somewhere else. I remember when people would go to the local park and take food and drink for a picnic; what could be thriftier for a day out. It didn’t use any petrol and the food and drink was what we could afford; the drink was often water! Now people have to go on a trip that involves a trip along a motorway and then stop off for petrol at inflated prices and junk food that is even more of a rip off. The junk food is also loaded with fats and the drinks with indigestible sugars. Do you know what happens to those indigestible sugars? They are broken down by bacteria in the large bowel to produce gas and that causes bloating and makes you fart; just what you need on a long drive with the family!

You can learn from junk food though. Those chicken nuggets are made from a cheap meat; they also use a lot of turkey and fill you up with ‘fries’. I know people who refuse to eat chicken then like my meals because I add a lot of colourful vegetables and make it look good! This particularly applies to children or adults who have never grown up! You can also use turkey in things like cottage pies to replace lamb and make them much cheaper. I make cottage pies in foil trays and just chop the turkey or chicken and put in the bottom. It makes it better if you pour a little gravy over the chopped meat; but don’t cover it. You can then just add your layer of mashed potato then heat in the oven until the top is browned. It is a great idea to freeze cottage pies too and I add mashed white cabbage to the mashed potato so I don’t have to bother adding vegetables to the finished meal.

Today’s thrifty idea was refilling a spray bleach bottle with cheap bleach; it all sodium hypochlorite @ 5%. The more expensive bleach is on sale in Poundland; that is worth having to get a decent spray and then you refill it with cheap bleach.

I am thinking about the garden and have bought seeds to grow herbs. I need to get out there and weed and dig a trench to put household waste into to compost for growing runner beans.

I read tips from an American blog about being frugal and thrifty and it highlighted the savings you make by working at home. You save time travelling to work, fuel, clothing because you can work in jeans and a top rather than get dressed in a suit for the office. Then there are meals at lunchtime, drinks and other odd little expenses. The one idea the American added was that you save on therapy! That would probably apply on this side of the pond if we bothered having therapy.

I am writing this and monitoring my email and Windows Live; normally I would monitor Skype too. You can communicate for free using Voice over IP on the internet, share photographs, music and files. I also use a webcam and microphone sometimes and that is clear when I chat in this country using Windows Live; but not always so good when going over a long distance. I chatted to my friend in Australia using Skype and even said hello to his mum and that was fine. I mostly chat to students in China and we use text unless they want to show me something. China is 8 hours ahead and so it’s dark there now and webcams don’t work so well in artificial light. It is still free and better than making a phone call! Communication with people in other countries is vital to avoid conflict and war. I chat using VOIP or through Facebook or other social media all the time and have friends in every country. I have chatted to people in China, one girl was in Palestine when it was being attacked; some are in the USA and Canada and I have friends around Europe. Serbia seemed like a strange country involved in ethnic cleansing once and now I know people there. This free communication is breaking down barriers between ordinary people who can share ideas, knowledge and freedom.

I will post my Frugal Friday blog tomorrow with more ideas; this week it’s F for free, frugal, food, festivals and fortune! Remember being thrifty and frugal is a life style; be a trend setter not a dedicated follower of fashion; fashion can be expensive.  If you want to follow anything; follow me on Twitter. You may like to read a blog from earlier in the week It’s Daylight Robbery! That blog seems popular, but then we all need a laugh.

Take control of your finances and you take control of your destiny…

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Use lots of colourful vegetables, it hides the vitamins!

Thrifty colourful meal; ideal for most people.

The Thrifty Thursday blog

I think being thrifty and frugal needs become a way of life and a matter of habit to really save you money. I did some research before I started writing this and did a search on the Internet for free samples and checked Twitter for free things and frugal things. I didn’t find much to interest me. I did spot a free sample of scotch, but the offer had expired and there was a sample of the deodorant I use but I had to register with yet another site. I decided I couldn’t spare the time for a few millilitres of deodorant.

I did check my telephone bill and broadband online and although it’s still the cheapest they asked me some time ago, to agree to a new contract. I accepted because they offered me 3 months at half price; I got one month at half price and then the price went up. I will remember that con when the contract is up and shop around.

I’ll be doing my usually Frugal Friday blog tomorrow and it’s E for education (great investment), earning and other E’s (no not ecstasy). Meanwhile, I write a note in my accounts book making a record of the money going out of my account for the phone. It is a good idea to keep accounts and then you know exactly how much money you have and can predict future cash flow. The next bill will be water and in the UK we can pay that annually or every six months. I have already decided to pay it for the next year and I can afford to pay for some work to be done on my car.  If I put off paying the second half of my water bill until September it won’t help because in September I have car insurance, followed by car tax in October and safety test and service in November. I don’t pay my car tax every six months, they charge extra for that. I don’t pay my car insurance monthly they charge a whacking interest rate on top for that. I don’t pay it by credit card unless I am paying the card off the next month. I like banks to pay me interest, rather than contributing to their obscene profits and bonuses.

I am planning to do some shopping. I did some research on the Internet last night and checked out the prices. My local Asda (the UK equivalent of Wal-Mart) has the best prices for most of what I want but I still check out the best deals. That usually means buying the smart price, roll backs or buy one get one free; whatever the offer; I check it out. I also check the price per kilogram on a lot of things. The price of chicken varied a lot. It went from £2.60 a kilo to nearly £5.00. The pack of thighs and drumsticks mixed were the cheapest and so I shall probably have those on Friday. The thighs are even cheaper in Iceland (the store, not the bankrupt country) but I bought those last week and they have more fat and so work out to be the same price.

I not only eat frugally, cook and experiment with recipes, contribute to a food website; photograph my creations and meals but research healthy eating. The problem of obesity and over weight appears to be an epidemic in the western world leading to all kinds of health problems. There are products that will help, slimming groups for support; books that promise you’ll lose weight if you follow the guidelines. The answer to over weight problems is simple, more exercise and eat less. You can however still enjoy food and replace some of the foods like sugars and fats with foods high in fibre and get your five a day fruit and vegetables. Many people who are over-weight complain they feel tired and after a few weeks on a high fibre, vitamin rich diet its amazing how much more energy you have. I don’t really have that problem, my waist size has increased an inch in the past few years but that isn’t a problem. I rarely eat junk food, its junk!

I often read the ingredients on processed food and it’s often a challenge to see if I can cook something that many people buy ready prepared. I checked out soup at the supermarket… It appeared inexpensive if I bought 4 cans for around £2.00 but I make that much for half the cost. I would probably open a can heat it and still be hungry afterwards and so eat even more. I have used canned soup as a cook in sauce though; they are much cheaper and chicken soup does make a good cook in sauce for chicken.

I look around Poundland (where everything costs £1); Poundland is similar to the dollar store in the USA.  I saw rolls of plastic film, what I call sticky back plastic. That can be useful for sticking on all kinds of things to refurbish them and so for a pound it’s quite a thrifty purchase. You can use it to help restore modern furniture, coasters, kitchen units; you just need to be innovative. There are lots more bargains, but the store has to make a profit and so not everything is a bargain. I follow them on twitter in case they have anything new. I am watching to see if they have seeds for the garden for this spring. I have bought some seeds to grow herbs but really want to grow some vegetables especially runner beans; they are great – they grow vertically and give an amazing amount of cheap vegetables. They are delicious picked small and cooked straight from the garden and can even be added to salads in summer.

Being thrifty and frugal is very chic and in fashion just now; it isn’t for dedicated followers of fashion however; it is for the trend setters. I see what is often called ‘street fashion’ and it can be innovation by art students or the ‘Emos’ and ‘Goths’, but it still ends up on the catwalks and exploited eventually by the fashion houses. If you want to be thrifty and chic, watch the streets not the catwalks and designer labels. A lot of really trendy stuff can be picked up in charity shops, markets and sometimes on EBay. I want some John Lennon sunglasses, that have become iconic now; I found some cheap but I need varifocal and reactalite lenses. I’ll manage without them!

If you can save just £100 a month by being thrifty then save it,  find somewhere to get a decent return on investing it and it’s surprising how quickly it can mount up. I managed to get a return of around 7% on peer to peer lending over the past year. You do need to try to beat inflation and so that was a good return. I do have a savings bond from a bank that just about beats inflation; but the new ones offer a return below inflation and so I’m looking for alternative investments this year. I have a good source of information; the internet and I can keep searching for a diverse range of investments now. The more money you have, the easier it is to diversify and reduce your risks.

You can start today and do keep checking on how well you are doing. To begin with you may start by reducing debts and becoming solvent and then you can build savings and have a foundation to begin a program of investments.

Being short of money makes us insecure and anxious; take control of your finances and your future. You can control and determine your destiny by being thrifty and frugal.

Read my Frugal Friday blog

The date of Shrove Tuesday 2011 is Tuesday 8 March. Why not make frugal pancakes?

16 responses

  1. sf-b

    thanks for the common sense advice…

    10, March 2011 at 3:11 pm

  2. Grannelle

    I see now how you’re using x-links to each current article, thus extending each’s shelf-life and usefullness. I also like the idea of P2P lending. What can I say, Mike? Another sterling exhibit.

    10, March 2011 at 7:13 pm

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  5. Another stellar effort, Mike! Now if you could just add some x-links…

    17, March 2011 at 2:26 pm

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  8. Rob

    The Government prints only 3% of the total money supply. 97% is created by the Banks – these are official ONS figures.

    Inflation is created by a variety of factors, in particular perception. If I think I can charge more for a good/service and still sell the same amount, I will. If I perceive others are doing the same and my costs are rising, I’ll continue doing it.

    The money supply is irrelevant.

    31, March 2011 at 5:56 pm

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  11. …Skydrive is online storage to store and share 25 Gb of space…

    Pretty cool. The suite of programs isn’t shabby either. Thanks, Mike!

    27, April 2011 at 8:20 pm

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