Monthly Archives: March 2012

Power brokers: you might save hundreds

Save money on your power billsIn an Advertiser article last week, experts predicted that South Australia will soon have the most expensive electricity in the world, followed closely by other Australian states. The article said that since the state’s electricity assets were privatised, the average household electricity bill has more than doubled from $770 to about $1600.

 

In another Advertiser article, it was reported that power prices are now the biggest financial worry for South Australians, even more so than petrol, groceries or debt reduction.

 

Why have our utility prices gone through the roof since our public power assets were privatised? By giving consumers choice and putting power providers under competitive pressure we were supposed to see lower prices and better service.

 

Instead, power companies have been reluctant to  properly maintain and develop the infrastructure that keeps our power connected. Some say it’s because of uncertainty about renewable energy schemes and carbon emission policies.

 

Whatever the underlying cause, you and I are paying for it.

There’s no better time than right now to exercise your consumer muscle. We’ve seen MyBudget clients save hundreds of dollars a year—sometimes more—by shopping around for the best deal on utilities. How you use that extra money is up to you: savings, debt reduction, Christmas presents, increased living expenses…

Let someone else do the legwork… Utility broking services are free for consumers. They make their money by earning a commission from suppliers.

You can find utility brokers on the web by Googling terms like “electricity comparison” or “power compare rates.”

Most broking sites provide a short questionnaire which leads to a recommendation for the best deal for your power usage pattern in your area. Make sure you have a few of your most recent bills in front of you so that you can answer the questions accurately.

We’d love to hear how much you saved by reviewing your utility service or changing power providers. Please post the amounts on the MyBudget Facebook page!

 

The "walletless" society

Money management tipsCashless culture

On our Facebook page last week we shared an ABC News story about new data which show that Australians prefer using cards over cash. We commented that cards make personal budgeting more difficult because it’s easy to lose track of spending. Our suggestion is to withdraw your living expenses in cash so you can closely watch where your money goes.

Let’s take the discussion a step further…

Imagine ordering your usual mocha-chocka-frappuccino and instead of reaching for your wallet to pay, you swipe your mobile phone instead.

Of course, what I’m describing isn’t imagination. It’s a product from Google that already exists. Google Wallet plans to turn our cashless society into a walletless one.

How does it work?

Google Wallet stores your credit card details or allows you to deposit credit into a Google Wallet account. To pay, you enter a security code into your phone and wave it over a Paypass or payWave terminal. These terminals are already in use in some retail outlets in Australia.

When it comes to security, Google’s answer is that their virtual wallet is safer than your real one. They argue that if you lose your phone, your Google Wallet is still password protected. Plus, you can cancel your telephone SIM card without cancelling any of your banking cards.

But what does it mean for personal budgeting?

I appreciate that the mobile phone has replaced everything from our wrist watches to our street directories. To some extent, online stores are even replacing our shops. But I’m worried that Google Wallet is yet another way to make spending way too easy. And spending without thinking is a dangerous financial habit.

What are your thoughts? I’d love to hear from you. Please post your comments on the MyBudget Facebook page!

 

Leah McNamara: living the dream

It’s unfortunate that for lots of people work is drudgery. Another day another dollar, a means to an end. It can feel even more unfair that the rarified few who get to do their dream jobs have careers that look unattainable to the rest of us. (Think: movie stars, professional surfers, and married-into-royalty.)

But, inspiringly, there are exceptions and MyBudget’s Leah McNamara is one of them. In September 2011, Leah celebrated her seventh year of service with MyBudget and she freely confesses that she is living her dreams.

This is because MyBudget has changed Leah’s life twice: the first time when she became a client and the second time when she became an employee. “By the time I started working at MyBudget,” explains Leah, “I was already very passionate about the company. I had been a client for two years and it had changed my life.”

“I hadn’t been good at paying bills,” Leah continues. “I’d had my phone disconnected and I had some debts, but then it totally changed. Because I didn’t have easy access to my money, it made me think before I spent. Things were suddenly paid on time and my financial life improved amazingly.”

Today, Leah is married to Kerin (you may recognise them from some of our testimonial ads.) The couple lives with their two young kids in a fixer-upper in their dream location. Their home sits on a seven acre property in the midst of McLaren Vale, complete with a working vineyard. “It’s just amazing. We love it,” says Leah about her lifestyle in one of the world’s famous wine growing districts.

In 2004, Leah was hired into MyBudget in an account setup role when the company was staffed by only six people. She later did stints in personal budget consulting, office management, and numerous project positions, including a four-month overseas secondment helping a company that offers MyBudget-type services in the United States.

Today, Leah is MyBudget’s National Service Delivery Manager, which means she manages all of MyBudget’s customer service and new client support staff—at last count, 86 people. Leah says that the key to managing such a big group is having great people and a good support structure. “We’re always learning,” says Leah, “But we’re also getting better every day.”

Leah acknowledges the pace of change at MyBudget, but she focuses mostly on how she has seen MyBudget’s unique culture evolve. “We’ve always cared about our clients,” says Leah, “But our team has taken it to a new level.” She gives an example from the previous day where staff had raised $600 of their own money to help a cash-strapped client whose newborn baby had developed life-threatening medical problems.

Leah attributes these spontaneous acts of generosity to MyBudget’s core values which include caring and making a difference. “We live by our core values every day,” explains Leah. “Not only do we encourage caring in our staff, we try to hire people who want to make a difference in other people’s lives. I guess when you bring a lot of thoughtful people together, you end up with a very caring environment.”

Eddy May, MyBudget’s product manager, says that Leah embodies the values and attitude that make MyBudget special. He says, “Leah has been involved in nearly every aspect of MyBudget in the last 10 years, initially as a client and then as a staff member. And outside of work she’s a great mum, wife and a dearly loved friend. All of these aspects make Leah a very caring and very well-rounded leader of our service delivery team. On top of it all, she’s fun and a pleasure to work with.”

Leah’s friendship with Tammy May goes back to their school years, and it was Tammy who initially suggested that MyBudget could help improve Leah’s financial situation. Tammy explains that Leah has more than repaid the favour: “Leah has been integral in the evolution of MyBudget — such a key player in developing the company you see today. Her commitment to our clients has never wavered and her input is particularly special to me for being my ‘right hand man’ for so many years.”

Leah also acknowledges MyBudget’s Dave Bohn and Sue Newberry for mentoring her to become a more effective leader. Sue describes Leah as a leader who clearly has the respect of her colleagues: “Leah not only stands for the client by ensuring the company provides exceptional service, but she also stands and supports her staff.” Lauren Clarke, also a long-serving MyBudget employee and one of Leah’s direct reports, agrees with Sue: “Leah balances the needs of our clients, staff and the company. She has been inspirational to me during my employment.”

When Leah is asked what the future holds for her she answers, “My ambition is to be at MyBudget forever. I know that at the moment I’m about as high in the company as I can go, but I’m sure that as we continue growing new opportunities will open up. To be honest, I don’t know what the future holds, but I know that I’m very happy doing what I’m doing.”

By guest writer, Kylie Hughes

Good money management habit: think before you spend

I was recently talking with a client about how their spending habits have changed since joining MyBudget. They told me, “My money management has improved because now I have to think before I spend.”

Wow. It’s such a simple, but powerful concept: the idea of stopping to think before spending money.

It sounds like common sense, doesn’t it? I mean, who would spend their money without thinking first?

The answer, unfortunately, is most of us. It’s hard not to. We live in an impulsive, fast-paced culture that’s all about ease and convenience. “Buy now, pay (think) later”.

We’ve all had that experience where we look in our wallets or at our bank account statement and expect to see more. “I thought I had $50 in my purse. I can’t believe I spent $40 yesterday.” Does that sound familiar? Lots of MyBudget clients are surprised by how much money they used to spend on stuff or how easy it used to be to buy new clothes or eat out and then not have enough money to pay bills.

But how do we swim against the cultural current and always think before we spend?

It’s all about creating new money management behaviours — and when we repeat behaviours often enough, they become habits.

As with learning any new skill, sometimes we have to challenge ourselves. So here is a 30-day money management challenge which is designed to result in thinking before spending. By the end of the month, the idea is to have established new money management habits that stick.

For 30 days:

1. Use only cash

No cards at all. Cash is an excellent visual reminder of your financial position. It’s way too easy to spend thoughtlessly with a credit or debit card.

2. Sleep on it

Delay all impulse purchases for 24 hours. This applies to anything from a bag of chips to a cute-as-a-button puppy. If it still seems like a good idea in the morning, go back and make the purchase. (If it’s gone when you get there, assume it wasn’t meant to be.)

3. Do your research

For any product or service that costs $100 or more, compare at least three prices through different suppliers. The internet makes this pretty easy to do. Also read consumer reviews when available.

4. Stick to your list

Never hit the shops without a pre-written list in hand and do not buy anything that’s not on that list. That rules out impulse purchases (see point 2 above.)

5. Meditate on your goals

Carry a reminder of your financial goals in your wallet or purse where you will see it every time you go to spend. You can type or write your goals on a piece of paper or you can use a visual symbol or representation that has meaning for you. For instance, if your goal is to save for a new car, you might carry a small photo of the car in the plastic window of your wallet. You don’t have to fixate on the image every time you open your purse. It’s enough for your brain to register it subconsciously.

Remember, the aim of this money management challenge is not necessarily to save money — it’s to train your mind to think before you spend. The upside, however, is that the more you manage your money consciously, the wiser your spending habits will become.