The price of everything and how to cope with it

[RepSpec]

hey all
just trying to deal with all the rises in expenses and wondering how people do it.
me and the missus recently bought (hope i got that right) our first home (modest 4 bedroom 2 bath less than 320k). on 2 average incomes (one mechanic one gaming attendant). after saving for 2 years for deposit, with a mortgage that chews up most, her car loan, phone bills, car regos (2 cars) insurance for both, gas, power, water, rates, private health insurance, h&c insurance... it doesnt stop.

how do people manage to deal with this? is it just a matter of get a better job, live stingey, or is it just the fact that everything is going up and its getting harder to live in a "free" country?
not the mention that we want to start looking at having kids soonish (within next 2 years)...

[Mr Hardware]

unless your wages are terrible there's no way a home loan should chew up most of your combined wages.

try and ditch the car loan.
try and cheapen everything else. do you neeeed private health? have you got your cars insured as cheaply as possible?

to answer your initial question, i have a house worth similar and i'm able to do it all plus save plus pay back extra and i have a kid and my wife is a stay at home mum. it ain't a walk in the park, but each year it gets easier.

[cs123]

I would have hoped that your bank sat with you and helped you work out what you could afford to borrow and still live.

Most people get a massive shock when they take on a mortgage. You need to re-evaluate the way you live. Cheaper cars, be frugal with services like electricity etc. No takeway. Look at what things cost at the supermarket.

[XM-coupe]

Its all about staying on top of your finances and being activley aware of whats coming in and whats going out.

You have to be very aware of everything. Prioritise, shopping around for cheaper insurance, etc. Also that car loan wont help any.

Its always hard in the beginning

[RepSpec]

when i say chews up income, most mortgages do. the loan was done properly with the bank so they signed off on that.
we do pay a bit more each payment but not a heap more.

[Trevor 57]

Originally Posted by RepSpec

live stingey

That is what we did, you just have to do without stuff - full stop, sorry but it is the facts!!!

Back when we were young and bought our first house (1981) we had a 1 yo daughter, one income, local truck driver me, we had to have a third of the price of the house in the bank for 12 months before the bank would give us a loan, in todays talk of a $300,000 house, that is $100,000 in the bank for 12 months, sitting there to prove you were good.

One old car, a very small black and white TV, a lump of foam as a couch, etc, etc, etc.

We then had another 3 kids in 3 years (twins inlcuded) all on a local truck drivers wage.

We couldn't afford to put enough petrol in the car to drive a 50km return trip, but 30 years later, life is a shyte load better. A 20 sq home on a 1000 sq mtr block we own, a 66 sq metre shed with hoist, we raised our 4 kids, have grandkids, a XE race-car, a XP coupe which she picked out, a new Ranger, a caravan. She works part time doing in home child care and has done for 26 years, I put myself through some worthwhile courses and have worked hard to imporve myself.

Nose to the grind stone is the key

[comagutsa]

would have tried to put the car loan into the home loan to save money
i work FIFO and always wonder how non mining people can afford a morgage these days

[2011G6E]

That's why Australia virtually cruised through the crisis that stuffed America...we have never just thrown home loans at people who they knew damn well couldn't afford them.

[poppa smurf]

live frugally, budget and go without

HP is your enemy

[Dusty1]

The bank was prepared to give us a lot of cash to buy a house. We were earning good money, we said no tanks. We thought about what we wanted and decided on a smaller place closer to the city as we both worked there.

Now with three kids (1 year old twins) it isn't easy. I got laid off in March and couldn't find a job, so I'm now a house husband. Money is tight, but a fully my partner earns good money otherwise I don't know what we'd do.

I hang washing out. I combine trips, and believe me, it is a pain in the backside having to get three kids in and out of a car. We rarely eat out or order takeaway. When I buy stuff I research and normally buy on line.

I'm looking at starting a small import business, and this should provide some beer money for me, won't make me a millionaire, it maybe some work on the side will help? People are always looking for work to be done on their cars.

[Ben73]

Yep I bought my first house this year. It is pretty tough at first. It made me realize how much of my money I would blow before hand.

I have cut back expenses and budgeted. I figured out my estimated yearly cost for each bill category, car, phone, internet, electricity, water, insurances then converted it into a fortnightly figure for each bill. Now each pay I put away how much I need for each category into a separate bank account I can only access online and just take money out as each bill comes in.

On the commbank website they have a budgeting tool which is pretty easy to use. That is what I used originally to start my budgeting. You don't have to be a commbank member to use it.

[zilo]

Don't take on a mortgage unless you have a minimum 30% deposit.

Don't take on a mortgage if the repayment exceeds 30% gross income per month of one wage....(This is how it used to be)

Renting is far cheaper at the moment than buying a property.

So...rent close to work, minimise travel costs and save save save.

[kaniSS]

The thing I don't understand is why must people buy a "HOUSE" on their first go? an apartment is also a viable, yet cheaper option so you don't have to live like a povo and can enjoy your life before you get too old.

[ILLaViTaR]

Basically you have to milk the big fish as much as you can/they milk you. Once people get their first taste of wealth they'll become more stingy and self entitled than people far worse off than them. Too many people nowadays with 6 figure salaries sitting in a chair all day only to have a product in their name, where most people in this world do far more in their day and make far less. No surprise everyone's becoming so litigious when people who just try to get by are constantly harrassed and milked by these already wealthy established people/companies.

Stuff is made to break not last, warranties are there to deceive you not reassure you, callout fees/double dipping, unexplained increases. Somewhere along the lines these companies decided to shift to giving the consumer as little as possible for the highest amount, and once they have your money their obligation ends there, they'll try to get out of it as much as they legally can, not stand by their product and help you. So pride gets replaced with greed.
Of course it SHOULD go without saying there are still many great companies out there, I still buy sidchrome stuff and find it extremely good haven't dealt with their customer service yet though ( haven't had to).

Wouldn't bother me so much if rich people weren't so stingy, have 4 houses and tell people they can't afford a loaf of bread (this is no exaggeration of stinginess they are even stingier than that) they don't do anything for anyone but themselves. It should be the other way round.

[The Yeti]

As above,

knuckle down, do your best to ditch the Car loan, if you have Pay TV, get rid of it, "live stingy" I dont know exactly what you mean, but watch your spending, take a packed lunch, eat out less often, that sort of thing

its a difficult process at first (was for me) but when we started out, we had my mother in laws old dining setting, my wifes grand mothers old lounge, my Mums old washing machine I patched up (actualy 15 years on I still have it). Living tight at the begining isnt any thing to be ashamed of its all just a means to an end

[comagutsa]

Originally Posted by Ugg

Renting is far cheaper at the moment than buying a property.

.

not in WA

[Benny D]

have a look into government schemes ( scam lol).
as of last night, i signed the paperwork to buy my first house. it is on the government shared equity scheme (again.. scam haha). where they hold onto 20% of the property and i only have to pay for 80% (in my case i got the 70/30).
its a brand new, almost finished being built 4 by 2 house. repayments are gonna be about 300 a week.
im a machinist on 50k, the missus is a stay at home mum and my boy is 4.

[The Yeti]

Originally Posted by Ugg

Renting is far cheaper at the moment than buying a property.

So...rent close to work, minimise travel costs and save save save.

Cash flow wise I see your point but as part of a big picture I have to disagree

[ILLaViTaR]

Originally Posted by The Yeti

As above,

knuckle down, do your best to ditch the Car loan, if you have Pay TV, get rid of it, "live stingy" I dont know exactly what you mean, but watch your spending, take a packed lunch, eat out less often, that sort of thing

its a difficult process at first (was for me) but when we started out, we had my mother in laws old dining setting, my wifes grand mothers old lounge, my Mums old washing machine I patched up (actualy 15 years on I still have it). Living tight at the begining isnt any thing to be ashamed of its all just a means to an end

My old bosses put all their money into investment properties and holidays. They owned the shop and all they drove were 2 old grotty AU falcons on lpg (their only cars, however bought their kids new cars), ate from the shop (the cost of food is by far the worst of all living costs imo), wouldn't even justify paying $4 for the red plumbers glue to repair the pipes lol. Even the rich can live tight, depends what you want I guess.

[ILLaViTaR]

Originally Posted by Ugg

Don't take on a mortgage unless you have a minimum 30% deposit.

Don't take on a mortgage if the repayment exceeds 30% gross income per month of one wage....(This is how it used to be)

Renting is far cheaper at the moment than buying a property.

So...rent close to work, minimise travel costs and save save save.

No boycott renting for at least a year! Wait it out if you can. The market has apparently overextended and the demand for rent is dropping, basically it works something like this

Investers overborrow/buy their 10th house/there's too many investors
demand for rent drops. It always has to "ebb and flow" if you think about it.
Because most investors borrow money they don't have they'll be forced to inevitably sell the house cut their losses and repay the bank.
Rent as well as property rates goes down.
The gap between residents and investors close and living become much more affordable.

That's assuming the investors pay the bank back lol. Otherwise we'll all have to.

[The Yeti]

Originally Posted by ILLaViTaR

My old bosses put all their money into investment properties and holidays. They owned the shop and all they drove were 2 old grotty AU falcons on lpg (their only cars, however bought their kids new cars), ate from the shop (the cost of food is by far the worst of all living costs imo), wouldn't even justify paying $4 for the red plumbers glue to repair the pipes lol. Even the rich can live tight, depends what you want I guess.

I'm sorry, I think I am missing your point, are you agreeing with me or disagreeing

All i'm saying to the OP is try to cut out on unnessasery spending got out for dinner once a month instread of once a week sort of thing

And just think before you spend, as an example. the weekend before last we got home from a dirty weekend away to find a broken window at our home (the wind had caught the screen door and flung it out in to the window smashing it)

OK so we call the insurance company I didnt remember if they included it as part of negotiations or not to get my policy, it seems I did but it had a $500 excess, so I rang arround, Obrians wanted $500 to do the job that afternoon, rang a few local bloked found one who would do it for $330 that afternoon or if I could board it up for the night he would be out the next morning 1st job and do it for $130. sold thats a saving of $370, is that being a tight wad? I dont think so I think its just looking for a less expencive option.

but you are right on one count the welthyest people I know are the tightest, I wonder if thats why there so welthy?

[neptune blue]

Originally Posted by RepSpec

hey all
just trying to deal with all the rises in expenses and wondering how people do it.
me and the missus recently bought (hope i got that right) our first home (modest 4 bedroom 2 bath less than 320k). on 2 average incomes (one mechanic one gaming attendant). after saving for 2 years for deposit, with a mortgage that chews up most, her car loan, phone bills, car regos (2 cars) insurance for both, gas, power, water, rates, private health insurance, h&c insurance... it doesnt stop.

how do people manage to deal with this? is it just a matter of get a better job, live stingey, or is it just the fact that everything is going up and its getting harder to live in a "free" country?
not the mention that we want to start looking at having kids soonish (within next 2 years)...

Hi
I havent read through all of the posts but Im sure someone would have mentioned debt consolidation
rolling all your loans into one as this reduces your monthly outgoings and gives you more money in your pocket

what you really need to do is set up a proper budget
if you dont have a head for figures I would highly recommend my budget

unlike your self I only have one debt, a house and I am on a very good salary
I was almost bankrupt at Xmas last year, mainly to my stupid idiot wife who thought she was saving money by buying stuff that was on special even if we didnt need it

with rates , school fees and xmas upon us I had $500.00 in the bank. she blew almost $15K in savings and cant remember on what (the dumb b***c)

At a complete loss on what I needed to do next I got help. I contacted my budget and they had a look at what the money was being spent on and how much
they set up a budget that we have stuck to which was tough for the first 4 months as there was much negoitation with creditors so that we could gradualy pay off our immediate bills

We now have $4K in savings and all out standing debts have been paid

So If youre finding it hard to make ends meet I would highly recommend speaking to my budget based on my first hand experiance
hope this helps

[Keepleft]

Originally Posted by 2011G6E

That's why Australia virtually cruised through the crisis that stuffed America...we have never just thrown home loans at people who they knew damn well couldn't afford them.

True, but that is the least of the financial problems facing the US now, Europes bad and some could face collapse, but the US faces bigger problems in the next few months, through Oct 2012 to 2016 or so. Let alone other sideline issues that can compound things further, like war.
I mean no offence here btw.

Read some headlines:-
http://www.shtfplan.com/

Originally Posted by Dusty1

Now with three kids (1 year old twins) it isn't easy. I got laid off in March and couldn't find a job, so I'm now a house husband. Money is tight, but a fully my partner earns good money otherwise I don't know what we'd do.

Good luck to you and your family, Dusty.

[MWTB]

When I moved out of home I had to learn how to live cheap. I'll be looking to buy a house this time next year, maybe start of 2014 even, but it will be an investment property, not for me to live in so it will be easier for me.

Things I learned:

Smoke rollies if you are a smoker. Tailors will cost you more for 2 packs than a 50 gram pouch which will last 5 times longer.

Eat a lot of rice and pasta. It's cheap, it fills you up, it's easy to make and it lasts a long time in the cupboard. Throw in some home made sauce and chicken or beef/lamb and you've got a sweet dinner that you can take to work for the next day. I make curry, and when I do, I make enough for my dinner, as well as lunch for the next two days. $20 for 4 meals minimum...not bad.

Ditch cable TV and download your movies and tv shows.

Get a second job if you can, even if its only 5 or 6 hours extra.

Grow vegetables if you have the space.

Don't eat out. It's ludicrously expensive for what you get.

Sell random stuff on eBay. It's amazing how much stuff you have that is useless to you but will be someone else's treasure.

It'll sound povvo to say this, but hunt around hard rubbish. If you see something that looks good, take it. Sell it on eBay. Even if you only get $20 for it, it's still $20 more than you had and it was free.

Good luck!

[zilo]

Originally Posted by Keepleft

True, but that is the least of the financial problems facing the US now, ...

Read some headlines:-
http://www.shtfplan.com/

.

Lucky I got my big gun and 3000 rounds in the cupboard, will now feel prepared for anything like those in that link...

[buggerlugs]

Buy a rickety old boat, Head out about 20ks North of Christmas Island. Send out a distress call. Then wait for the handouts............

[ronwest]

Originally Posted by buggerlugs

Buy a rickety old boat, Head out about 20ks North of Christmas Island. Send out a distress call. Then wait for the handouts............

Really?

Don't be a afraid, possum.

You probably just need to change your fishing spot, lol.

[onfire]

How to do you manage it?

Never live outside your means.. simple.

[ronwest]

I've got four adult kids. Two are married and have their own homes, one is in the process of doing both and the youngest is in Mount Isa getting the readies for home purchase.
I know that no-one is interested in hearing the "when I was young...." story, but truthfully, imo expectations are too high these days.
As has been mentioned previously, it will entail sacrifices in order to get to where you want.
It's all down to choices. A bit less now for more later? Or, the reverse?

[Cheese3]

well afew mates my age 24 have dived into the house market and built houses, they spend between 350-400k on their first house, which are located on the outer sides of the city . . . I live in geelong and you can buy a older done up home not in scum area between 250-300k which i would do. My generation wants all the latest and greatest but i remember stories from my folks, they never had new furniture ect ect but girlfriends/missus expect to much imo too. my best mate bough a 4k TV . . . idiot

When i buy a house ill buy a nice older done up one 3bed room 2 bathroom between 250-300 close to centre geelong. I use the saying . . .

Quoting myself
"I only need a house for 4 things, which are eating, sleeping, shitting and fcuking and not necessary in that order either"