Watching our pennies

....seems to be the topic of the month in my household. Due to my husband's recent job loss, and subsequent new found employment, we have lost approximately one third of our income. Thankfully we have no debt other than a mortgage, as we own both our cars (albeit, old and crappy), and our credit cards are paid off. This makes things far more manageable. The challenge for me is to manage the finances as they are, without impinging on our lifestyle.

So with this in mind, I am looking to 2010 with new eyes and new ideas. You'll all be aware of the secondhand/handmade challenge I am undertaking, and this should help balance the books somewhat. I'm also big on budgeting and I have a spreadsheet with each of our outgoings listed. We also have several bank accounts - an 'everyday account' for daily spending such as groceries and petrol; a 'monthly account' for monthly bills such as kindy fees, phone bills, mortgage payments etc; a 'longterm account' for bills such as rates, electricity, car services, rego etc. Each payday, I have a scheduled transfer from our main account into each of these accounts. It's an easy way to keep control of the money and it also helps me keep track of where we might be over-spending, or over-budgeting. We do have a savings account too, and I aim to deposit something into it each payday, even if its only $5! We find the best way to save is to pay extra onto our mortgage each fortnight. This way we reduce our interest payments and if need be, for a small fee, we can redraw this money.

As of today, I am also attempting to do my grocery shopping fortnightly. The aim of this is to decrease what I spend on food, and to keep an eye on what we eat! I hope to do a lot more baking and home cooking, and therefore reduce the amount of 'extras' I purchase each week. Hopefully by buying in bulk, I will be able to reduce costs too. I'll keep you posted with this one!

As an ex-travel agent, I find it hard to go without a holiday of some sort each year. We have always travelled, even before children. Next year we are off to Malaysia thanks to the cheap airfares of Air Asia. $1100 total for the 5 of us!! So now my challenge is to find cheap accommodation. You know - champagne taste on a beer budget, and all! I have a few months to sort this out. Who knows, maybe we'll rough it and hang out with the orangutans in Borneo!?!?

For me, being penny wise is about not compromising on the big things. I'd rather slave away in the kitchen and buy my kids secondhand clothing than miss out on the wonderful things like travelling and eating at lovely restaurants every now and then. How do you save money? And what is important to your family? Do you like holidays, or would you prefer to save for something else? Do you save at all? Or do you only just make ends meet? I'm curious. We've always had enough money for what we've wanted and needed. It's tougher for us now (a great thing, from my point of view - nothing like suffering a little for personal growth), and I'd really love to know how you all manage.