AUSTERITY DRIVE

I can’t multi-task. I have one of those one-track minds that need to be done with one thing before I can go on to another. But it also means that when I am on that one thing, I am more or less 100% on that one thing.

About a year ago, that would be losing weight and keeping fit. Hence all the training stuff which bored a few people around me. That has languished for the last few months, and this month, I’m into…..the money stuff.

I tell you it is those “Get-Out-Of-Debt” and frugality blogs that I happen upon and been chasing down. They make really fantastic reading….and inspire me to pay more attention to my own money matters.

I have no debts, of course, but I was always aware that I was not exactly doing the best with my money that I ought. I have a budget that I never stick to and although I keep account of all my spending, much good it does, since I never bother to use the information to improve things. So I thought I should relook at my whole personal financial situation since I am in the mood anyway.

I did a net worth estimate tonight. I have been squirreling money away in several places religiously, but I thought it would be interesting to know where I stood. Well, if I liquidated all my assets today, I would be around 450K including CPF, which I did not think was too bad for a 32 year old. I have to admit though that most of it is due to luck – company share options (with extremely good market years) and extremely generous bonuses.

So, I already took steps in cutting down my spending and making my net position blacker than black. Cutting cabs was one, the rest such as food, shopping etc are falling into place quite easily for various reasons. I am optimistic that I’ll finally meet the budget this month.

I am spending extra effort to optimize other stuff too. I have 15 credit cards. It would take another post to explain why, but anyway, only one is being used on a frequent basis. I am not worried about CC interest rates and debts, but I am starting to think about the potential for CC fraud. So I am going to cancel a number of them. And I plan to optimize the remaining for best cash rebates options.

I think I also need to relook at my investment strategies, since most of it is in medium to high risk equities and mutual funds. Maybe I should look at some government bonds or something. Need to educate myself and put things in place while my mind is still on this subject.

The experts say it is good to work towards some goals, short and long term. I can’t say I have one other than to retire comfortably and as early as practicable, and since I consider myself quite low maintenance, I think it won’t take so much money. Of course I haven’t figured in health care costs after retirement, but that is why I am looking into euthanasia laws….haha.

But I’ll be honest. The whole reason why I am into this whole austerity drive now is nothing more than an academic exercise….because this happens to be the flavour of the month. And also because it makes me feel really grown-up and responsible. Haha.

There is one issue that I have been struggling with, though, and that is the balance between frugality and the quality of life. Like, going to a moderately up market hair salon compared to a neighbourhood salon at a fraction of the cost. Or using more specialized facial products over more generic products for my problematic complexion.

If I were clearly in debt, or having problems meeting ends meet, the solution is clear - cut costs first. But what if I could fit everything into my budget, the only result being that I save less? I am still trying to decide on my priorities.

So, this has been the journey so far. I wondered how long I could keep the interest up to achieve some really great stuff financially, but I decided to take it day by day. It would be interesting though, to see if I could cross the million dollar mark, net worth-wise, another 10 years down the road.

Check back and we shall see