Back to blogging after a really long holiday break. Christmas was fabulous with an extended family reunion, exotic food, few good and few not so great gifts. The best gift surely was the pair of Prada sunglasses that my hubby gifted. New year eve was one helluva party night that extended well beyond the day.

We are well into 2009 with our waistlines up by a few inches and wallet lighter by a few hundred dollars. We badly want to reverse the status of the two now. So here we go with our cost saving and waist(e) reduction plan for 2009.

First look at the household expenses since these usually form the largest part of our monthly spending. Grocery is one huge expense. I obviously can’t stop eating. But I sure can resist getting tempted by those yummy looking cookies, tarts and cheese dips attractively displayed in the stores. They sure know how to seduce people like me.

Having a shopping list in hand and trying to stick to it, while going out for shopping should help. This should help me have a watch on my waistline (hope I also try and fit into jeans one size smaller, something i’ve been trying for years now). Comparing prices in 2 or 3 stores to see who offers the best deal should also help; since stores usually offer good deals at the end of the month to clear stocks. Eating out is a sure no-no for the next few weeks atleast. Whether to work or travel, packed lunches are my best friend, now on.

The next big money sucker is my power bills. If the air conditioner or room heater is switched on all through the year then there is no choice but to foot hefty power bills. I read somewhere that when using room heaters or coolers, the room has to be properly insulated. Otherwise all the cool air might just slip through the small gaps in the window and door frames. So my important task this weekend would be to check my entire house for leakage.

Also, when using a PC, most of the power is used up by the monitor. So I guess when I’m not using my PC for more than half an hour or using it just to listen to music, it makes sense to switch off the monitor. The yellow heat generating incandescent bulbs generate 70% more heat and use up 75% more energy than compact fluorescent lamps (CFL). So there goes another weekend task of mine. Changing my conventional bulbs with a CFL. This way, I also do my own small bit in saving the environment. Small little things like switching off the lights and other power utilities when not in use, leaving the windows open during summers to let the sunlight through should also help.

When discussing fuel bills one of my colleagues suggested filling gas in the car early in the mornings as much as possible. As the day progresses, with the increase in heat, the gas stored below the earth in the gas stations would be in a vaporized form during the day, which would mean a lot of vapor will also go into my fuel instead of gas. By filling it in the mornings the vehicle will be able to absorb almost all the gas that I pay for.

Weekend entertainment is also a huge part of the monthly expense. Instead of cutting down on entertainment, maybe I should reschedule it. Most movie halls, multiplexes, fine dining restaurants and entertainment parks charge heavily during the weekends. Let me try rescheduling my weekly entertainment to a movie on Wednesday nights or a nice dinner on Thursday nights. This way I pay less for almost the same service, avoid the weekend crowds and also beat the mid-week blues away.

So that is largely my plan for 2009. Will keep posting on the progress.

 

I am very happy today. My best friend Kaitlin just called me up to say that she is expecting. The stork will visit her place in the summer of 2009. When I expected my baby two years ago I was well prepared mentally to welcome my bundle of joy. But experience has taught me that it is equally important to be financially prepared.

So i gave my pearls of wisdom to Kaitlin on how and why it is important to be financially prepared to welcome your new child. Let me share it with you all too.

DELIVERY OF THE CHILD - First things first. The actual birth of the child. Home deliveries are becoming popular. And yes they do work out cheaper. But it requires a lot of preparation in terms of the partner’s willingness to assist in the delivery process. If you or your partner is not sure or if there are medical conditions in the later stages of pregnancy like high BP or gestational diabetes it is strongly adviced that you have the child delivered in hospital with proper medical assistance.

POST CHILD BIRTH EXPENSES – So you just welcomed your new bundle of joy into this world. Apart from giving both partners sleepless nights the baby will also bring in a lot of new expenses . Okay you may hate me for asking you to count and calculate when you should actually be admiring your baby’s little hands and feet and the innocent smile. But trust me, by being prepared financially you will have lesser worries and and have more time to enjoy your baby’s little pranks.

So here I continue. These are the new categories that will find place in your monthly budget with the arrival of a new child.

1. Diapers – You would need these by the dozens everymonth. Ask me about it. You could try alternating between re-usable and use-and-throw diapers.
2. Clothes – This is a recurring expense. Children outgrow their clothes faster than you expect. And then there are winter clothes, summer clothes, booties, body suits and so on.
3. Medical care - There are a lot of vaccinations in the first year of child’s life and a dozen visits to the paediatrician to make sure your baby is growing fine.
4. Food – If you are planning to go for formula feed then you have to factor in those costs. Blogger chieffamilyofficer has some interesting posts here and here on preparing baby food at home that is both healthy and costs much lesser.
5. Toys –The child care product makers in the market have the knack of making us feel guilty of not caring for our child enough. So we end up stacking a lot of pacifiers, baby gym, teethers and rattles. Do not stack up in advance. You will anyways get many such stuff as gifts.

And then there are other utilities for a child like crib/cot, car seat, bath tub and stroller that you have to stack up.

TWO JOBS OR ONE – Financial planning has to be done based on whether both partners will be working after the birth of the child or if the mother will take a maternity break for three/six/twelve months or quit the job. I have been repeating often that traditional wisdom suggests an emergency fund equal to atleast three to six months of ones salary should be maintained by every working individual. If the mother is taking a maternity break she should ensure that the emergency kitty is sufficiently full.

If the mother will resume work in a few months after the baby’s birth then options like leaving the child in a day care centre or hiring a baby sitter would be considered. You can calculate to see if the mother’s pay check is big enough to handle the related expenses and stress arising out of leaving the baby in a day care centre or with a baby sitter. You could try taking help from parents, friends or other family members if they are willing to do so. Works out cheaper and you can also be at peace that the child is in safe hands.

By preparating adequately the first 2-3 years of your child’s growing years will be smooth sailing for you. This blog has more information on financial formalities post baby’s birth. As for preparing for your child’s education, future and stuff, thats a bigger topic. Let me keep it for another day. Ciao.