Frugal Honey

Life & Money

Two Steps Forward, One Step Back

While still heady from the achievement of reaching half of my emergency funds goal, I suddenly found myself in a wanton spending spree that still leaves me a little guilt-ridden up to now.

I bought a pair of glasses early this year using a court subsidy and it’s been serving me fine, but lately, I’ve been lemming for new glasses, more particularly, the emo-type of glasses. I know, I know, I’m too old to go Bieber on anyone and it’s too late in the day to jump on the emo bandwagon. But what can I say, I’ve been thinking of buying a new pair of glasses for the last few months and so last Monday, I did just that.

Then that same night, we found out that Elton John was having a concert at the Araneta Center this December 8, and before you could say “Rocketman” I had charged two upper box tickets on my card.

The thing is, we’ve been quite responsible with our spending as a whole (although we could do with less of eating out to be perfectly honest) and we don’t exactly live an extravagant lifestyle, so why am I beating myself up over these little luxuries?

Maybe it’s because my now waning Catholic guilt is slowly being replaced by financial guilt. Where every expense has to be accounted for and must be devoid of frou-frou. And there’s the fact that we need to save up for my planned maternity leave and Bean related things (strollers, car seats, immunizations Oh my!).

So I’m currently on damage control mode. Last night, I called my credit card and asked that my recent purchases be converted to 0% installment for 3 months and the hubby and I decided that the concert tickets will take the place of our Christmas gifts for each other. Of course, it also goes without saying that we won’t be going on any out of town trips anytime soon.

Everything has been ironed out and new pledges have been made. So why do I still feel so guilty? It’s tough to be a Type A personality Catholic on the path to financial independence. I sure hope I don’t pass this slight neurosis to Bean 🙁

Meralco bill update

I wrote about getting an inverter aircon in this past post, and after much soul and wallet searching, we finally bought a Koppel 1 HP unit from SM Appliances.
The unit cost Php27,495, but we made use of SM’s deferred payment plan, staggering the price to 6 monthly installments of Php4,582.50. I honestly thought the unit would run up to Php40,000, so paying “only” Php27,495 was a very pleasant surprise. What really hurt though was the Php7,500 installation fee that we had to pay upfront. Ouch.

Anyway, our Meralco bill arrived 2 weeks ago and there really was a decrease in our monthly electricity consumption. Take note of our July bill:
Now our August bill:
From Php4,228.85 (333kWh), our bill went down to Php3,436.80 (272 kWh)! That’s a difference of Php792 🙂
Admittedly, I expected more savings than that, but I remember that August was the month my hubby was bedridden for almost a week and spent most of his days watching TV. This month, our TV routine is back to normal, so I’m crossing my fingers that our Meralco bill will go down even further.
For even more good news, electricity rates are supposed to go down by Php1.73 per kWh this month (read news article here) leading to a potential savings of Php470 for our household (Php1.73 x 272 kWh) 🙂 I’m hoping to whittle down our electricity bill to Php2,500/mo. and let it stay there for good. Hooray for saving money!

Question: Should I continue making extra home mortgage payments?

About three years ago, my mom bought three condo units and took out a PAG-IBIG loan under my name to fund one of the units (for the other 2 units, she used my sister and dad’s PAG-IBIG benefits). The units were leased as dormitories to the students in the nearby school, and the rent payments used to pay the monthly mortgage.

Two years later, my husband and I moved out of our rental in Sta. Rosa, Laguna and moved into “my” unit. I took over mortgage payments and am currently repaying my mom what she paid for the equity. The original loan from PAG-IBIG was Php750,000 with a 30 year fixed interest rate, and the mortgage is pegged at Php5,600/mo. After two years of payments, my mom remitted about Php130,000 to PAG-IBIG, but the balance still stood at Php720,000. After 24 months of payment, only Php30,000 or so of the Php130,000 was applied to the principal, the rest went to interest payment.
And that’s why when I assumed paying the loan, I decided to pay an extra Php5,000 on top of the monthly mortgage, since the extra would be automatically applied to the loan balance, thus considerably shortening the mortgage period.
But my husband and I want to move to a house in about 2 years time, and we intend to sell our present condo unit to add to our house fund. Considering that, I’m now thinking twice about paying extra every month because obviously, shortening the mortgage period is no longer a priority.
Our loan balance is now at Php670,000++ and if I continue paying an extra Php5,000 to our mortgage for the next two years, an extra Php120,000 will be deducted from the balance. While if I only pay the mortgage, the bulk of my payments go to interest payment and only about a fourth or a fifth go to the principal.
Here’s the scenario:
With extra payments= Php670,000 – Php120,000 – Php30,000= Php520,000
W/o extra payments= Php670,000 – Php30,000= Php640,000
So should I continue paying extra every month, or should I just take that money and add it to my monthly stock/mutual fund budget or emergency funds? Our condo unit is currently priced at Php1.2M and in two years time, it will probably be at Php1.3M-Php1.4M, so the Php80,000 savings seem minimal.
What do you think?

Addicted to Traveling

We have reworked our food budget, ditched our non-energy efficient A/C, regularly sock cash away in our emergency fund and have turned my our back on impulse shopping. But in spite of all that, we still have a long way to go in improving our personal finances, simply because we still haven’t owned up to our biggest vice: Traveling.

We don’t have a lot of luxuries, but we are not deprived either, so I don’t understand why my hubby and I always feel like we deserve to go out of town every other month or so. It’s like we have programmed ourselves to believe that we owe it to ourselves to pack our bags and jump in a plane or go on a road trip every chance we can get.
Just this year alone, we went to Biliran, Baguio, Sagada, Cebu, Dumaguete and in a few days, we’re off to Puerto Princesa Palawan. Every trip costs us around Php5,000-Php15,000, and that’s already a very rough estimate because I would conveniently forget to remember how much we spent on eating out, souvenirs etc. etc. and so forth. I would say that we’ve spent at least Php60,000 on traveling for the first three quarters of 2012.

That Php60,000 could have been funneled towards our emergency fund, or part of it invested in stocks or mutual funds. Instead, we spent it all on traveling. But do I regret splurging on trips with my hubby? Absolutely not.
Lianne over at Wise Living said it well when she wrote that we should spend not just time, but also money, on our relationships. Traveling and spending time with my hubby will always be worth every peso spent. However, considering our financial goals, I think it’s time we re-evaluate our spending, while still satisfying our wanderlust tendencies.

We’ve been looking at group deals for hotels and we decided that next time we’ll try spending a weekend at a hotel within the city for a change (no plane fare to contend with!). After all, our idea of a vacation is a pool, a buffet and lots of sloth-like behavior. Leave the touristy photo-ops to some other couple.
And so while it hurts me to not take advantage of KLM’s $888 all-in European promo, I know that all these financial decisions will result to us developing better financial know-how and all that jazz. Besides, I have a feeling that this isn’t a one-time offer from KLM (crossing fingers!)

Saying No

 What is it about deciding to be more frugal and money savvy that suddenly brings an onslaught of delicious (and expensive!) choices right at my doorstep?


First, the hubby’s sister invited us to go with her and her kids to Vietnam. Halong Bay is right up there on my travel list, and traveling with my new family just makes the deal extra-sweet. And to top it off, my SIL was springing for accommodations!

It was almost perfect except for the fact that we don’t have Php30,000 – Php40,000 just lying around to finance that trip. I could charge the tickets and borrow from my emergency fund, but really, I’ve had enough of charging trip expenses and then cursing myself for the next few months while trying to pay off everything. Besides, trips are not emergencies.
Same with the trip to New Zealand this December that my parents are planning for my sister’s birthing (approximate expenses Php80,000 – Php100,000). It took me about half a year to wipe out all my 2011 NZ and Fiji expenses, and I don’t even want to think about how much I spent in finance charges.
Aside from trips, there’s also the Phantom of the Opera tickets that I’m lusting over. Non-nosebleed seats are at Php3,500, so that’s Php7,000 for the hubby and me. Ulp.
As much as it pains me, I’m saying No to all of the above.
I know that the hubby and I will be able to go to Vietnam and New Zealand on our own dime, without stretching our budget. And as for the Phantom, we’ll be seeing him in Broadway when we make our way to New York in the future.
I might miss out on some memories, but I know that memories that will not put me in debt are much, much sweeter in the long run.

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