Posts: 125
10 November 2023 at 9:42 am #803

The next way to remove discretionary spending is:

But wait. Rmembering that we agreed the card/overdraft/whatever isn’t for casual spending right? RIGHT???? Do I get an Amen 😀

I bet most of us forgot the above. I’m using a card story to explain the training, so I’ll stick to that from now on, but it could be any kind of third party money source.

This situation doesn’t apply to everyone (yes, actually it does…) and that is… you know your benefit, income, wage, drawings schedule that says, this is what our income is regardless of how it is split up?

Well… write it down. What is your income? $500/week, $900/week, $5000000000 whatevers a week like a real champ?

Times your weekly income by 52 (for a year) or your fortnightly income by 26 (for a year) or your monthly income by 12. That is the actual base income, averaged income, fixed amount (not counting bonus’, penal rate additions, transport allowances etc… just the … whatever income is the base that you can say goes to family needs and fixed outgoings (oh yes, add in any home supllementary income like accommodation benefit.)

But don’t skimp out on some of the above. if you have split pay, or some goes by AP to special acocunts.purposes or direct you health, insurance, rent… it should be added in. We want the actual figure. We’re working in bulk here man. Get it on.

Ok, I’m going to say $50,000 after tax. Oh yes, we mean the after tax figure. Pete gets $50,000 per year.

Write down for the equivalent period that actual basic must pay costs. And I mean, rent/mortgage, power, internet (because we want you to be here), travel to work expenses, insurance, rates, phone. Those fixed costs. Nothing else (no, not netflix, sky, cable tv, KFC or pet grooming… nothing extra that actually, if we had to, could be cut out.)

Ok… got a figure? Work it out for a year. This is Pete’s average fixed outgoings per month:

Power $250, Internet/phone $225 (cause hes also paying off a phone on the account). insurances $200, Rent $1620 (averaged), tarvel to work/medical needs $200 and work/medical parking $40. Averaged water/rates $240.

So that’s $33,330 a year approximately.

Hey wait a secondomojo… this isn’t rocket science. Your’ averaging, not being exact. Rough it up and just work with me here.

Taking the total base income of $50k and deduct the fixed outgoings of $33,350 leaves Pete with 16,650 for discretionary spending.

Poor pete has $320 a week for everything else. Actually Pete isn’t poor. There are people with much less than that. And we haven’t even eaten yet.

The key point in the above rough workings… which any of you (actually all of you) can do is…

Be aware that discretionary/casual spending habits rob you of your ability to truly live. It’s even worse if you are using your credit in between pay runs. You need to refocus for a while instead of going shopping 3x a week (whatever.)

Oh by the way… the coin box rattles so there’s some already in there. How are you going with your box. I’m going to ask regularly. I’m smiling at the …. well, $1.80 in there so far.