What Do You Do With An Extra $500 In Your Pocket Every Month?

Posted on August 14, 2009


Hi all. I hope you are all well.

What would you, as a reader, do with an extra $500 in your pocket every month?

A lot of it depends on which stage of life you are in. If you are a teenager, $500 means shopping, booze and probably rent. Bang for their dollar, but not milking the money for what it’s worth. I know I am right. After all, which adult hasn’t been 21 and fondly remembers those partying days?

If you’re an adult or possibly, newly married, it’s more than likely you have little savings as your start building your nest from ground up. Between mortgage, the dreaded bills and grocery, any extra left is a bonus.

It was only a year ago when the Reserve Bank of Australia’s key interest rate stood at a high of 7.25 per cent. Since then, home owners with an ever tightening budget have had a bit of relief with rates plummeting to a low of 3.00 per cent.

PhotobucketWhat does that mean for young couples with a mortgage in the ‘middle-income’ bracket like Michele and I? Mind you, I think the apostrophe is appropriate as anyone with more than a $400,000 mortgage immediately puts the owner in a ‘snob’ category. Or anyone who would pay through the skin of his teeth to be in the suburb of his choice, rather than thinking rationally and count the pennies.

I reckon we did pretty well with the savings. Oh yes, definitely spend it on the flash 60-inch plasma television I’ve been eying for the master bedroom…NOT!

For us, it meant we had an extra $500 a month in our piggy bank. I’d daresay our family have had an extra $5000 in our pocket, which is a rather accurate representation of how much ‘add-on value’ we have added to our home in the last ten odd months.

Not since Regan’s rotating head and pea soup shocking my system in my early teens has a scarier episode f–ked me mentally. So much so it prompted me to shell out several thousand dollars on security doors, grilles and roller shutters.

Now that we live in a prison, I feel much safer knowing that in the event of a fire my family would be trapped and burnt to crispy embers. The firemen are outside, unable to come in as I’m busy resuscitating a dazed Toby after seeing something other than the neighbour’s cat and Michele’s packing her cook books into her duffel bag while reminding me to clean the house. :O

Jokes aside, we’re now more comfortable living in our own home. We leave home happy knowing that we’ve detered all but the most determined robber. Of course, every Australian home owner knows that if the robber is determined enough, nothing we do will prevent the eventual clearout.

PhotobucketThe extra money also came in handy as we cast our petrified minds back at the last two summers we endured in fifty degrees heat in our home. Take a bow, air conditioning.

WH Carrier, the bloke who invented air conditioning might look a little like Liam Neeson, but I’d gladly trade a Lightsaber anyday to rub shoulders with someone who has experienced a genuine Eureka moment. Jedi Master or not.

We got a good deal and went on our merry ways, purchased several units of air conditioning and now wonder how on Earth we’re going to be able to afford the installation.

All in all, it’s been a good year for us. We’ve purchased several necessities, and didn’t end up in debt. Win.

Many home owners in Australia sit on a dangerous precipice as they have used the extra savings to indulge in goods that added to their already burgeoning debt. Sure it’s all hunky dory now, but the next move in official interest rates will almost certainly be up as the central bank weighs a growing body of evidence suggesting the worst of the global recession is over.

I can’t imagine this little honeymoon period will go on much longer, but we’ll milk every extra money we can each month and make sure it’s spent wisely.

Now, about that 60-inch plasma…

Posted in: Life At Home