Staying with the one car

A few weeks ago, I mentioned about looking into getting another car via a novated lease. This idea is being driven by the rising fuel cost. The family car has a diesel engine, which has a higher servicing frequency, so the only going maintenance cost is quite high. After looking through our current situation, financially and personally, we have decided to go with the one car. However, we may decide to visit a second car again. I mean, with a growing son, I would imagine that by the time he reached the age of 4 to 5, we will need two cars.

So the reasons are

1. Another debt - Getting another car represents another debt that we just don't need at this stage. We have just purchased a house and we want our financial position to stabilise before making another big ticket item purchase like a car.
2. Less disposable cash - After moving into a new house, there will be certain things that we will want to purchase. Top of the list a set of curtains for the house. The back of the house has a large windowed area that only has venetian blinds, and I doubt if that is very heat efficient.
   
3. Unhealthy for me - If we have a second car, it would be much easier for me to just jump into it and drive to work. Our new house is about another 15 minutes bicycle ride to work. So to promote a much healthier lifestyle for me, I should not make it easy for myself. Riding my bicycle to work would do wonders for my health.
4. Higher chances for complication - My wife and I try to live a simple life, believing that the more complicated our lives become, the higher chance of the unexpected happening. If we have drive another car, the chance of us having an accident or having it stolen would be higher.

Once our financial position stablises, we shall revisit this situation.

Photo by Jay Simons

Another Australian PF blogger.

I recently came across My Journey to Eliminate Debt, a blog run by Louise.

Louise uses her blog as a way of giving herself focus on eliminating her debt, in particular her mortgage. This is a very fantastic target to aim for. I came across her article about the medical issues that her dad is in and the tough decision she has to make in order to support him. I can relate to her as my family has suffered in similar circumstances. The stresses that the family had to bear is not only financial, but also emotional as well. Our mental health also took a battering.

I wish Louise all the best in her quest of eliminating her debt, and spending many days with her love ones.

It is also great to see that another Australian is also blogging away on personal finance.

Carnival of Money Stories, #17

The latest edition of the Carnival of Money Stories is up at A Penny Saved. It is the 17th edition.

My article, Dad and my first house, was part of the carnival.

A couple of the articles that I found interesting were:

My Daughter's Currency - Interesting article take how a child views money and currency

Sleeping with Money: Out earning your partner - Explores the issue where your partner earns more than you. Nina's partner earns 20 times more than she does, find out how she handle this.

If you are after a great selection of personal finance stories with a personal touch, check this carnival out.

PPR concession on our new home

A few weeks ago, I wrote an article about how the land transfer duty, and possible ways of reducing it. I came across one today.

We are still going through the paperwork on our new house purchase and came across a concession from the Victorian's SRO. It is called the PPR concession or the Principle Place of Residence concession. The SRO has a site outlining what is a PPR concession is and how it is calculated.

In a nutshell, for the price range that our house falls into, we will enjoy a 1% discount in the duty calculation, saving us about $1600 dollars.

The concession is capped to a maximum value of $2850.

I have to thank our currently Victorian government for this concession as it become effectively from the start of 2007. Hooray for Steve Bracks and his team!!

Carnival of Personal Finance - 108th edition

The 108 edition of the Carnival of Personal Finance is up at the Broke-Ass Student .

Some of the interesting articles are

What is considered an emergency - moneymonk ponders the question on what is an emergency. Knowing what is an emergency is critical on determining if you have enough emergency money to see you through.

How to nail or fail job interviews - rich minx has some obvious but essential advice on nailing that next job. You never know what that will be, but it is coming.

Why a 0% interest loan keeps me up at night - a very nice article on what it means to tight family unit. It reminds me of what my dad did for me after I graduated.

Forming a relationship with money - a very good article on associate emotion with money.

My article on the financial security aspects of arranged marriage also made it into the carnival.

There are plenty of articles for everyone. Get over there and enjoy the reading.

Long pick up for eBay winners.

My wife and I are taking the opportunity of shifting house to do a bit of a cleaning, (or junk ridding session), of the house. We have started the process some months ago by having a yard sale. Now, we have put some old furniture up for auction on eBay.

One of these items is a bedroom suite that we inherited from my in-laws. They have updated their bedroom suite and passed it on to us. Since we did not have any cupboards or bedside tables at that stage, and be a pair of frugalist, we accepted them. Now it is time to get rid of them and update it. The bedroom suite is from the 70s, and my estimated value for it is about $60 to $70.

The auction just finished last weekend and was won by an eBayer. I was actually surprised that it got sold as we never got a bid until the last 30minutes of the auction. We started the auction at $65 and it got sold at $102.50. It was certainly much higher than anticipated.

The winner was from a town that is about 7 hours returned drive. The winner showed up at hour house this morning in a 4WD. I estimate that it would cost at least $90-$100 as it would have used about 80 litres @ $1.25 per litre.

Let do the maths.

Final price of the auction - $102.50
Fuel cost - $100
Total cost - $202.50

The thing that got me was the amount of travel that some eBayers would do. In this particular situation, I would have though that traveling 7 hours for something that is worth $102.50 is not a fair good outcome, at worse you probably could have spend that 7 hours searching on eBay for something in the similar price range that is located closer.

One thing that I failed to consider is personal financial situation of the purchaser. Spending $202.50 on a bedroom suite may have been a great purchase for them, and the time spent to pick it up is time well spent. A equivalent bedroom suite, brand new, would have been at least $500 to $600.

I have heard many stories of other traveling much further to pick up their auction wins, one of them includes an overnight stay.

If that was you, would you travel for 7 hours to pick up the bedroom suite?

Does arrange marriage equal to financial security?

Arranged marriage is the concept where parents will decide who will be marrying you. There are varying degree of arrangement involve, and is largely culturally based. In the middle east, parts of Asia and Africa, arranged marriage should really be called forced marriage. In a more modern westernised culture, the children will have some involvement in their parent's spouse choices.

Many of us who are married will know how expensive a wedding can be. This is also true for a wedding for an arranged marriage.

Why are you writing about arranged marriage, you might be asking. Well, if we remove the emotional side of wedding and focus of the financial aspects of it, it shows that an arranged marriage has a better chance obtaining financial security. Before exploring the reasons why this might be, let just say that I am not an advocate for an arrange marriage as I am an romantic at heart. I would prefer to be married for love, and then make the financial aspects of it work out positively.

Parents knows best

A lot of people get married in their twenties. Let me say that age again, twenties. Imagine making a decision that is literally that you have to commit to for the rest of the life. Our parents, who has brought up a family and have more experience life longer that you have, would have the necessary knowledge to select a suitable spouse for you. The parents are able to predict how you will be in a family situation and will select the most suitable spouse. We would select a spouse with a lot of emotion, and that may hinder our foresight or how closely we match. A good match means that decisions, especially financial decisions, will be easier to agreed upon.

Rate of divorce

The Australian ABS says that in 2006, the divorce rate is 2.6 per 1000 population, and I have read that 1 in every 2 marriages in expected to end up in divorce in California. Whichever you looked at it, it is quite high. Figures for arranged marriages are hard to come by, but I have heard that it is in the single digit figures, although it would be interested to note how this is measured. If this is true, a low chance of divorce means that a higher chance of your marriage working out. A divorce is always messy and expensive and wasted energy, so it is best avoided.

Consolidation of wealth

In the old days, arranged marriage were popular among the wealthier families, especially the royal families of Europe. They do it for reasons of money, power and control. Many of todays wealthy and powerful families are carefully crafted. The Rothchilds is an excellent example on how arranged marriage has worked out for them.

In modern times, arranged marriage is seen as a way for poorer families to gain some wealth, especially for the poorer spouse.

Rate of Success?

Having suggested three good reasons for arrange marriage, would it work in modern times in a western culture? I have to say that the western culture does not really provide much opportunity for arranged marriages to prosper, but that is only my opinion. I truly believe that for a marriage to work, the human elements must be part of the it. After all, marriage is the coming together of two human beings. However, if you remove these elements, an arranged marriage would have a high chance of success if the spouses approached it with the right mindset. This article from the dailybruin.com has some nice points.

As I write this article, it became clear to me that for a family have a higher chance of becoming financial secure, the parents needs to be successful in their marriage, no matter if it is arranged or otherwise.