Frugal Honey

Life & Money

Smart Shopping

Fashion and the retail calendar are very predictable. With fashion, you can be sure that trends will be recycled with regularity, and with retail, you can bet your bottom dollar on two major events: the mid-season and post-holiday sales. Which means, it’s now time to shop!

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My Kryptonite

I have a weakness for buying things on installment basis. So far, I’ve been fairly responsible, choosing to buy mostly big ticket items for our house on installment basis (i.e. aircon, ref, steel shelves etc), although I have slipped a few times and bought non-essential things (i.e. new eyeglasses and leather bag), since my mind automatically chops up the price into 6 equal pieces and proudly declares it as kayang-kaya!

Another weakness that has made its evil presence known fairly recently is a hankering for jewelry. I don’t really like jewelry per se, but I do have this secret dream of collecting pieces that I can pass on to my daughter during milestones in her life. The pieces I have in mind are pearl earrings, diamond earrings and a gold necklace with a simple diamond pendant. Classics that any generation can appreciate.

I was introduced to my friend’s alahera a few months ago after I revealed my dream of owning south sea pearl earrings (a dream that had its inception after my lola’s SSP earrings were passed on to the eldest cousin, a.k.a. Not Jill). And there it was, a set of obscenely sized champagne colored pearls set in gold. The price made me gasp at first, but compared to the alahera’s other pieces, it was practically a giveaway. She agreed to sell it to me for 12 equal installments and we were both happy.

However, I saw that she also had these gorgeous diamond donut earrings set in white gold and I couldn’t stop thinking about them. The alahera came back last week to tempt my officemate and I with her new pieces. I wasn’t really interested in the jewelry sets or the pearl lariats, but the diamond earrings were still there and when I tried them on I was smitten. Ack. 

To cut the story short, I am now the proud owner of a pair of diamond earrings and while I love how it sparkles on my ears, I will never, ever reveal how much I paid for it (at least to my husband). The alahera cut me some slack and told me that I can start my installment payment by May of 2013, since I’m still paying for the pearl earrings and will continue to do so until July of 2013. 
I appreciate the consideration but what worries me now is that I’ll be on maternity leave by May or June of 2013, and the thought of the monthly payments eating up into my SAHM budget, as well as cutting short my planned maternity leave, troubles me. I have thought of returning the earrings, but I don’t want to (cue brat mode). So I have come to the conclusion that if need be, I will dip into my VUL fund, a.k.a. The Europe Fund, to subsidize my new earrings.
What is it about diamonds and girls? Sigh.

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?

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