Saving dollars and cents – My morning coffee

I’m old enough to remember when there wasn’t a café on every corner selling speciality coffees. Go back a few years earlier to that and those corners were probably pubs instead.

Anyway, back in the ‘olden days’, you could still get a coffee in a café but it was normally to accompany a meal and it was often served from a jug that had been percolating for hours. The coffee was often rough and only served the function of providing a caffeine hit.

Move to today and you can barely walk 20 feet without coming across a café, van, pop up shop or any hole in the wall that is big enough to fit a coffee machine and a human. The term barista has now a common place word, whereas in the past it was normally associated with a poor spelling for a lawyer.

Over the years, it was my practice to grab a coffee on the way to work to start the day. To me, it was a nice treat to start the day and get me going. Over the years also, the prices have gradually (and sometimes not so gradually) increased and increased. Most recently, I was often paying $4.50 for my morning coffee but occasionally found I was paying up to a dollar more. Many shops I’m assuming trying to justify their prices by a speciality coffee blend that had been sourced from some exotic country from the excreted remains of a camel and pressed individually by hand through a blessed cloth…ok, maybe I’m stretching that part a bit.

Even at only 1 coffee a day, I’m was spending over $30 a week on my morning coffee. Multiply that by 52 weeks and its over $1600! The math isn’t hard if you are a 2 or 3 coffee a day person. It really starts to add up to something significant..

Just out of curiosity, I did a quick Google to find out the breakup of my morning coffee cost. The following table was indicative of what I found.

Though the $3 figure is obviously a bit dated, it provides a reasonable idea of how the cost is made up. Based on this chart, the product associated with my morning black coffee is only $0.35. The majority of the money handed over is for labour. While I definitely won’t argue that a worker should be paid, the coffee normally takes around a minute to make. That’s a pretty decent hourly rate, with the majority presumably going to the owner. I don’t want to get into a big economical debate though, with the main point being that it really adds up to buy my morning coffee.

Anyway, as I’m pursuing the frugal way, my morning coffee is now instant coffee. It took me a while to get used to the taste. While not offensive, I can’t say the instant coffee compares to a barista coffee. I drink black coffee, so it’s hard to mask the taste of terrible coffee so I do tend to spend a little more to buy a good quality instant coffee just to improve the taste slightly. That said, I’m probably talking $2-3 dollars more a can, which still works out massively cheaper than barista made coffee.

My best rough calculation is that I’m spending less than $100 a year now for coffee versus $1600 for barista coffee. That’s $1500 a year that will now be going towards paying off debt and making steps towards by end goal of early retirement.

 

Enjoying the moment…

It’s only the early days of my early retirement ‘project’ and I’m a long way from feeling overwhelmed, stressed, drained, jaded or depressed by the practicality of my impossible goal. My mind is almost constantly thinking of ways I can progress further financially, working on projects to scrape together a few dollars and researching details about retirement and living in Thailand. I’m finding it invigorating and exciting. Of course, in between that, I have my work commitments and general day to day tasks to complete.

I was in the middle of putting a load of clothes washing on today when I caught something out of the corner of my eye. In my fish pond (sans fish) was a single, beautiful flower. It was a vibrant pink in colour and I had to walk over and look at it more closely. I found myself just admiring the flower for several minutes. During those minutes, my mind was totally focussed on the flower and it’s beauty. No thoughts of work, money, my goals, jobs to do or anything else crossed my mind.

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It was a moment of clarity and gave me pause to reflect that every soon often, you have to let yourself take a moment and appreciate what is around you. There are so many little things around you that make you smile, feel at peace and just lets you switch off the gears in the melon for a while. It doesn’t need to be a flower. It could be listening to your cat purr, the smell of your morning coffee or a refreshing breeze on a hot day. Whatever it is, enjoy the moment.

Don’t get so focussed on your goal that you forget to live.

Shift work is tiring – Toughen up or quit!

As I noted in previous posts, I have only recently started to work shift work. For the 30+ years prior, I have primarily worked Monday to Friday, 9 to 5.

On the whole, I have really enjoyed the transition to shift work. It allows me a lot more freedom during the day to do the things I need to do and want to do. With evening or night shifts, I also don’t have to set an alarm and just wake up organically. As it is, I usually wake up much the same time anyway but better rested than I would normally with the dreaded alarm in my subconscious.

However, I do struggle with the morning shifts. Mornings are the preference for many as it allows them to get the work day out of the way and enjoy the day. For me, I always find myself too weary to really be that productive at the end of the work day as I find it difficult to get good quality sleep when going to bed at 7PM. And when I get home, I’m almost counting the hours until I need to head to bed early again. I just find I prefer the evening shifts that finish between 7PM to 2AM.

Today though, I am struggling a bit. The last 4 nights I have finished at either 1AM or 2AM. Today, I am facing a 10 hour shift and finishing at 12:30AM. I’m sure a lot of people would find this a cruise and work 7 days a week for months (or even years) on end without flinching. Many again work 2 or 3 jobs just to make ends meet. For me, I think my physiology has just got used to the routine of 9-5 work and I’m physically struggling some days.

What I have to remember when I feel a bit flat is that I have a compelling goal. Early retirement to a place that brings me happiness! Shift work is providing me penalty work and overtime. While it would nice to have weekends off to socialise like a ‘normal’ person, I currently have the ability to perform relatively stress free work and without any formal qualifications and make a very reasonable hourly rate of pay, particularly on weekends on public holidays. (I will note that the background of the blog pic is how it looks outside today. Sooo nice. Tempting to stay home…but no!)

Every hour today is making that little bit extra coin that I can contribute towards making my dream reality. So, enough whinging about being tired and suck it up. The light at the end of the tunnel is where I can relax and rest.

 

De-cluttering – One Way to Focus a Messy Mind

With my newly developed mission to retire to Thailand in 5 years, I was sitting in my lounge contemplating how I will achieve this. While trying to think, I was constantly distracted by the things around me. There were half completed projects, cleaning, an excess of furniture and décor items and many other things that made it difficult to focus on my goal. 

I did manage to come to one focussed thought and that was that I have too many unnecessary distractions and I had to clean house, initially literally, to achieve a mentally clean house.

First step – Assess the mess

I simply looked around me. I started to list items as follows:

  • What items have a functional use
  • What items make me happy
  • What items haven’t I used in 6 months and have no immediate plan to.

I approached this process to my immediate surrounds as I sat in the lounge. The post photo is just a few of the items that immediately jumped out at me. As my living area is not that large, I had obviously accumulated far too much crap. The process defined what to keep and what needed to go.

Second step – Complete projects

I determined to finish projects before I started anything new. I have so many projects that are half done. Some furniture restoration, landscaping and home renovation. I get started on one and get half way, get distracted by something new and shiny change and start something else. I started to list projects that I had outstanding and prioritised for completion. I decided my first project would be the landscaping, which I ended up completely within only a few hours. One off the list, which gave me a sense of accomplishment and reduced one item from my mind clutter. I will note here that I haven’t had a kitchen sink for 3 months, so maybe that should be pretty high up the list to get sorted out!

Third step – Clean up the crap!

I had to clean up. This is perhaps that simplest step and the one that will have the most immediate impact. I have a terrible tendency to pile things onto counter tops, table tops…really any flattish surface. It obviously looks messy and annoys me and does nothing to keep my mind at ease. I started with the kitchen. A packed things away, threw out things that were inexplicably just sitting there and tidied up surfaces.

Fourth step – One step at a time

I decided that I shouldn’t try to do everything at once. I know this is what has caused me to fail before and probably will again. I get all hyped up and start cleaning, start gardening, start doing this and that. In the end, I only touch the surface of the problem and see no real progress and get overwhelmed. I just end up adding to my list of unfinished projects. Focussing on one thing at a time will get a task completed and show a positive result. A structured way to approach this is to create a task list and prioritise. Ticking off items on completion will give a tangible visual that things are getting done.

Fifth Step – The purpose for the surplus

This is an extension of the First Step. After I determined what bits and pieces that I no longer needed, I had to decide what their next purpose would be. Options were as follows:

  • Sell stuff that I considered had potential to make money. I have listed items on eBay and Gumtree and hopefully will make some money to contribute to the goal. Once everything has been sold, I will blog the final amount.
  • Give to charity. This applies mostly to my clothes. I have clothes that have travelled with me across 3 states over 8 years and still haven’t worn. Time to let go for someone that may need it and doesn’t have the means.
  • Recycle. There are recycle centres that are available that let me dump certain items for free.
  • Dump the rest. Smaller items I will dump in the bin and the medium sized items I will throw in the back of the ute and take to the tip. As tipping fees apply to the rubbish weight, I will save some of the bigger items for a council kerbside clean up next month. The pick up is limited to a trailer size equivalent but as people tend to ‘shop’ the kerbside, items are usually taken to allow me more room for something else.

Well, that’s the plan for now. I may tweek it as I progress to include more de-cluttering ideas but this is the start.


Sugar vs Sugar – Which is sweeter to your pocket?

Though I have only recently been approaching frugality with focus, I have always had the approach that I (1) buy the best priced product if it is of comparable quality and (2) that I do not want to purposely give more money to large corporations to make them larger.

During a recent shop, I had to purchase some white sugar. I won’t name any brands but it was obvious that there was a huge disparity in cost. A 1 kilo branded sugar cost $1.90 and a generic brand cost $1.00. A further bit of research found that there were a number of different brands of sugar with prices varying from just under a $1.00 a kilo to $2.14.

Clearly, with this cost disparity, there must be a difference in the ingredients that make one superior to the other. Imagine my complete lack of surprise to find that the sole ingredient in every package was 100% cane sugar!

Perhaps where the sugar was manufactured resulted in the cost difference? An army of cheap labour from overseas maybe? No, they were all produced in Australia.

Finally, the taste must be considerably different, resulting in the significant extra for the branded product? Low and behold, the ones I have tried all tasted like…sugar! Go figure!

My only assumption is that I’m paying for a recognised brand name, which has yet to pay me for my loyalty, or that only less attractive sugar canes are harvested for the low price brands.

I reckon my money is better in my pocket than fattening someone elses. Look around and keep it to yourself.

Living on a former income

So, the first change that I have made is to have a quick overview of my spending. One thing I have always done is increase my spending every time I secured a promotion or higher salary. This usually results in me obtaining more things I want but don’t necessarily need. I then sell the item almost with fail for a loss or just fill my home and garage with stuff.

In November 2016, I secured a new job. The base salary was almost exactly the same as the previous job I had but with the benefit of shift penalties and overtime. Both shift and overtime were in no way applicable to my previous job, so the only option of obtaining more money in the role was to gain a promotion or wait for incremental pay rises.

In my new job, shift penalties are standard, adding between 12.5 and 15% per hour for an applicable shift. If I secure a shift on a weekend or public holiday, additional penalties and overtime apply. Subsequently, though a bit inconsistent, my pay has been considerably more than my previous job. The lowest being around $150 to nearly $700 net more per fortnight.

It occurred to me recently that I was able to live comfortably on my old salary. (It is strange how the mind seems to work far more logically when there is focus and a goal.) I never saved a lot with my old salary and overall it was tight. In saying that, it was rare when I was counting the days for a payday to come up. In theory then, there is no reason that I shouldn’t be able to live on my former salary and take any additional pay and use it to reduce debt. Given that the interest rate applicable to credit cards and loans is considerably higher than a standard savings account (with an almost non-existent interest rate), it is obvious that reducing debt is a priority.

The biggest debt I currently have is my home loan. This loans allows for additional payments that can be withdrawn if a big expense pops up. Until that big expense happens though, the interest on the loan will be calculating on the lower amount.

I know that mentally, I will really feel a lot closer to my goal when the debt is under $200k and then $150k and I will know that I’m closing in on the target when I crack the $100K mark!

Start of a new journey

 

Recently, I had that moment a lot of people probably do when they wonder what is next for their life.

I am early 50’s, no partner or kids (but a cat), have a decent job with a fair salary and have a sizeable mortgage.

I guess I am reasonably content but not particularly enthused. Other than owning part of a house, I can’t say I have achieved a whole lot in terms of career or tangible assets. I started to review my life and experiences & it became clear that one of the few times I was really happy and at peace was during my several visits to Thailand. I found the people, culture, food and climate really worked for me and it is where I wanted to spend the rest of my life.

The problem is, I don’t have the money to retire there anytime soon. My savings and superannuation is on the low side. I have a reasonable amount if equity accrued in my house but not near enough to let me retire unless I want to be homeless after a few years.

I estimated I need approximately $500K to let me live fairly comfortably in Thailand without having to check my account balance every week. The other part of the equation is I want to retire there in 5 years. The numbers definitely don’t add up!

My blog will be partly about my journey to my goal of early retirement to Thailand, changes to my financial habits and other things I do to save and earn money.

Over time, I hope I find a few people to follow the process and keep me accountable, so I don’t lose focus when I can’t see the light at the end of the tunnel and it gets too hard.

It all starts today!