Socialising with friends can get expensive. There’s the cafe rendezvous, the shopping dates, the after-work drinks, the restaurant dining, the night-clubbing, the movies, the concerts… suddenly catching up with friends has taken a fair chunk out of you budget.

And don’t even get me started on endless rounds of Tupperware or Avon parties.

If you’re trying to save money, pay off debt or just reduce your spending, socialising can be one big spanner in the budgeting works.

But of course, no one wants to give up their friends and live the life of a hermit.

So how to stay frugal and socialise too? Here are four ways to cut your social budget and keep your friends.

1. Be upfront about your circumstances.

If you’re turning over a frugal leaf, be up front with your friends. Real friends will be supportive rather than excluding. In fact, they may just breathe a sigh of relief and join you in your efforts to save money.

The effort to keep up appearances in the face of financial struggle is an unnecessary pressure we we put on ourselves because we fear that our peers will judge us. But more often than not, the people around us aren’t judging but are struggling to keep up appearances also.

Be honest and upfront. Your real friends will support your financial choices.

2. Be the one to initiate activities.

If your non-frugal friends like to spend up big when socialising, take the lead and suggest alternate activities. Ask friends round for dinner before they suggest a restaurant, find a free gig or concert to enjoy, suggest a picnic or a bushwalk as ‘something a little different’. You can be casual about this – you don’t need to mention that these suggestions are frugal.

3. Balance your ‘regular’ activities with more frugal ones.

If you have a weekly dinner date that is straining the budget, rather than ditching it altogether, alternate between dining at a restaurant and dining at home or other frugal activities on the off week(s). That way, you’re not missing out on the restaurant experience altogether, but you are saving money. And restaurant dining will become all the more special and something to anticipate and savour when you do it less.

4. Spend less doing your regular activities.

If ditching some of your regular social commitments isn’t an option, find ways to enjoy them for less. If dining out is your budget buster for instance, eat an entree rather than a main and drink water (or go to a BYO restaurant). See a movie on cheap nights or look for shop-a-dockets, drink less alcohol and more water (your head will thank you in the morning), skip the before or after concert meal.

You know this already: you don’t need to spend money to have fun. Convincing your spendthrift friends may be another story. Fun rarely has anything to do with how much you spend. It’s more about the company you share and your attitude to life. Lead by example and your friends will be thankful that they can save some of their own money.

Have you read these articles?:

1. Does Having Friends Cost You Money? 30 Ideas For Budget Entertainment
2. get out of the house without breaking the budget
3. 8 Ways To Improve The Value Of Your Property Without Breaking The Budget

I received this comment the other day and I thought that rather than let it get lost in archives, I would share it here today and ask you if you have any advice or help to give. The comment was:

“My boyfriend and I are pretty much on the same page as far as our thoughts regarding finances go. We are planning on getting married next year, but as it’s his second marriage and he has two children living at home, and we’re both paying mortgages he is REALLY happy to scrimp and save on EVERY aspect of it, whereas I have never been married before so I feel there are some areas I would like to splurge a bit – like my ring, dress, reception and photographer… We’ve discussed areas we could save, does anyone have any tips?”

Firstly, I think it’s awesome you’re both on the same page when it comes to finances. Money can be a major point of contention in a relationship, so if you’re both like-minded when it comes to spending money, that will be a boon in the future.

It’s not unreasonable at all that you want to have a nice wedding. Like you said, this is a new experience for you, you want it to be special and you should remind your partner that.

My advice is to first sit down and discuss and agree upon a set budget. How much are you both willing to spend in total on your wedding? Weddings can be expensive (the average cost of a wedding in Australia is around $30,000), but they don’t have to be.

Once you’ve worked out a budget, you can then start planning what you can afford to splurge on and what you need to scrimp on. Are you comfortable hand making invitations, for instance?

The most important thing is to remember that you don’t have to spend a lot of money to have a wonderful day.

For example, when it came to our wedding, I bought my wedding dress for $130 on eBay. It’s a gorgeous dress and I loved it. We hired a photographer who was just breaking into the wedding photography business, and as he was building his portfolio, he was priced at a much lower rate than more established photographers.

I could have sworn that I wrote an article on saving money on a wedding, but I can’t find it, so I must have just dreamed that I wrote it, something I will have to write about in the future.

If you can help with tips or advice, it would be wonderful if you left a comment below.

Have you read these articles?:

1. Love and Money
2. sharing financial responsibility in marriage
3. reader survey: eating well on a budget

It’s that time of the year again. Time to draw up a new budget and decide on some goals for the coming year. DH and I recently sat down and had THE TALK. What our financial priorities will be for 2011.

Dealing with stark financial realities is never fun. Budgeting and goal setting can be difficult enough for the individual, but throw marriage into the mix and it can be a minefield. The convergence of different ideas about how money should be handled, what is a comfortable amount of debt, whether money should be saved and how much, what to spend the money you have on, can all lead to stress. Once you are in a relationship where finances are shared, you can no longer effectively budget and set goals as an individual. We only just realised this a year or two ago. While I was busily planning all the renovations I wanted to do to our house, DH’s goal was save up every last cent, sell our house and move. Our financial goals were in conflict and we didn’t even realise it.

So this month we sat down, looked over next year’s budget and decided on some shared financial goals. We discussed options and made some compromises. I thought we needed to focus on buying a newer car. DH felt that we would be just wasting money, that the old bomb probably has another year in it yet. His goal was to invest some money and increase our assets. We compromised by agreeing to invest a little while putting what money we could aside to buy a newer car some time in the future. And we both agreed on fixing up the backyard so this became financial goal number one. However, all of these financial goals hinge on one thing. We both agreed that I have to do something to earn some extra cash otherwise none of these financial goals will be possible.

I’m no expert in money talk and marriage. I’m lucky enough that DH and I are pretty much on the same page when it comes to finances. We don’t fight about money. After all, you can’t fight about something that you don’t have. But here are some things that work for us when it comes to the money talk.

Set a date

If you’re the person who deals with the household finances, set a date that your partner agrees with, where you can sit down and discuss finances. Don’t spring the discussion on them with a “we need to talk about our finances right now, turn off the TV,” give them time to think about your financial position and goals. You both need to be relaxed and able to focus on the discussion with full attention.

Make sure the kids are in bed and the TV is off

Pick a quiet time where there are few or no interruptions so that you are able to to make some concrete decisions and set some realistic goals. Half-started, half-hearted conversations will not result in the action that needs to be taken for real change to occur.

Use facts

If you keep a budget, then using actual numbers makes any discussion more concrete and financial goals more attainable. Write out a debt plan and your net worth and look at your cash flow. If you are considering large expenses such as renovations, get a quote or two so that you have a ball park figure with which to work with. Tracking expenses and using a budget will also mean that you can both discuss the strengths and weaknesses in your financial situation.

Avoid blame

Before having a discussion with your spouse about finances, decide what the purpose of the discussion is. Is it to improve your financial situation? I’ve found that open discussions end in positive change more often than arguments do.

Discuss common goals

What financial goals do you both agree on? These goals are the ones to focus on, other goals come secondary.

Compromise

You and your partner will each have separate personal goals. If the budget allows, agree on some common goals and then one or two separate personal financial goals. For example, one of my personal goals is investing in a new theme for this website. DH has no interest in that goal. We focus on the main goals and allow a couple of personal goals as well.

Write it down

Write down both your common goals and your personal goals and put a budget on each goal. This way there are no arguments six months down the track, you can refer to hard physical evidence as “this is what we both agreed on as being fair and reasonable.”

Set boundaries

Agree to a ‘splurge fund’, money that can be spent freely without recriminations. That way you can be both working towards your common financial goals, while still having a little room for everyday splurges without the guilt. Discussing ‘rules’ that work for the both of you and that you both agree on (for example discussing expenditure over $100) and respecting those rules will mean less money arguments. Write these agreed rules down as a reminder.

Make the commitment

Once financial goals are agreed upon, both partners need to take concrete actions to make those goals a reality. That might mean giving up an expense that is not serving your financial goals. If your partner is a spend thrift, leading by example may help and if not, you are still one step closer to your goals than what you would have been if you hadn’t made those compromises. Sometimes seeing results is enough motivation for the other partner to tow the line. Tracking expenses can also be a real eye opener.

Do you have tips for the money talk? I would love to here how you work out your finances with your partner.

Have you read these articles?:

1. Australian Online resources for money management
2. Teaching money to kids with five activities
3. Love and Money

Our neighbours moved out this week. They have been the best neighbours we’ve ever had. They were not drug dealers, or 3am loud music partiers, or V8 Ute revers, or a screaming domestic couple (yes, we’ve had them all). Instead they were a quiet couple about our age with a young son like us, who would say hello at the letterbox. And I’m sad to say that in the last two years we’ve been living next door, we never got to know them.

I recently read Trent Hamm’s book The Simple Dollar (author of the popular blog with the same name) and I was struck by his emphasis on community and building positive relationships. When you build positive relationships, especially with like minded people or people you have something in common with, then you gain not only friendship and opportunities for socialising and fun, but mutual support and encouragement. You have people around you to lend a helping hand in times of need, and likewise you are there for them. You have contact with a wide variety of expertise, people who can offer advice when you need it, people who have been there, done that and can guide you with experience…and give you hand-me-down stuff.

Which brings me back to our neighbours. Four years living on the coast this month and we have hardly met anyone. Yet day in and day out, the lady next door would be trundling her little fella up and down the driveway in the late afternoon, waiting for dad to come home and all it would have taken was for me to pop my head out the door and say hello. And now the opportunity has passed.

Remember when, for better or worse, we all knew our neighbours. When I was a kid, mum would chat over the fence with the lady next door. Garden produce, baking and homebrew would be exchanged, baby-sitting would be offered, and if it rained while mum was out, there was always a neighbour to bring in the washing or vice versa. Dad even cut a removable panel in the fence so that for BBQs a hole would appear in the fence and the kids could play in one yard while the adults sat un-accosted in the other, yet with easy access and visibility.

Now we build higher fences made from brick and cement and install electric gates.

I realise some neighbours aren’t the kind you would want to get to know. We have had some rough ones. But there have also been some surprises. Ironically, some of our best neighbours have been rough-nut, hard drinking ‘ex’ bikie gang members. I remember dad putting his head over the fence once and saying ‘we don’t use that kind of language around here,’ yet that neighbour is still a close family friend, even after moving away.

My point is that despite modern communication devices, sometimes it seems that we have never been so isolated from our community and from the people who live around us. They say that ‘no man is an island’ but I wonder if we have built ourselves our own little islands inside our large and fancy homes and high fences, yet all the while desperately trying to ‘connect’ through Facebook.

I have a friend who will read this and laugh. She makes this point all the time. While I am a huge defender of the internet community and I love my net time, it’s out of balance. It doesn’t seem right to not know the names of our neighbours and be able to at least hold a conversation with the people that we practically live with once in a while.

Part of the frugal philosophy is moving away from multi-national globalisation and instead being involved in our local community. Shop local. Buy local. But maybe the first step in rediscovering  our local community is to just shake hands with the people who live next door and say “G’day, my name is Melissa, nice to meet you.”

It is not unusual in a marriage or relationship for one person to take on the responsibility of the household finances. The job of ensuring that the bills are paid on time, that the savings account grows and debt is paid off more often than not falls on the shoulders of one person, while the other is blissfully unaware. While this can be convenient it can also be problematic as I have recently discovered.

Despite the fact that I take care of all aspects of our household budget, I assumed that DH also knew about the important aspects of our finances. I was wrong.

We recently decided to make a few changes to our home loan. As it is a joint account, both DH and I had to answer a few questions for identification purposes. Questions like: What financial products do you have with us? Have you recently made any transfers to your account? As DH doesn’t handle our finances he couldn’t answer the questions, failed the identification test and we were not allowed to make changes to our loan as a result. While I’m glad that the bank doesn’t let any old person have access to our banking details, it was also very annoying.

It made me realise that if, heaven forbid, something happened to me, DH wouldn’t be able to access our savings, would have trouble making changes to our mortgage and wouldn’t know where our financial and other personal information is filed.

It was exactly this type of situation my mother found herself in when my father passed away a couple of months ago. My father had a habit of hiding important and valuable things when they travelled, in case the house got broken into. It took mum weeks to find the things that dad had hidden.

There are a few things that you can do to keep your partner in the loop and ensure that should anything happen to you, your other half will be able to take over the household finances with minimal difficulty.

• Take time to discuss your finances on a regular basis. Things like upcoming expenses, financial goals and financial health.
• Organise your financial documents and information well. Have a place for important papers and ensure that everyone knows where they are filed. Clearly mark them so that they are easy to search through if necessary. I know that it may be a security concern, but have a safe place for bank account details so that everyone knows how to access the household accounts if necessary.
• Inform your other half. I’m not suggesting that you prepare an entire PowerPoint presentation for your spouse (although you could if you wanted to) but if you’re the one tracking the bills, watching the debts and the savings accounts and keeping a budget, it’s a good idea to sit with your spouse and go through some key points on a regular basis.

One person taking on the financial responsibility in a marriage can ensure bills don’t get forgotten or double paid and the household finances run smoothly. If you do have sole responsibility of the household budget, ensure that your spouse is kept in the loop so that they are able to help make financial decisions and if something should happen to you, they don’t find themselves at sea with the household finances.

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• 18 month diary
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Have you read these articles?:

1. help a reader: love, marriage and money
2. Evaluating Your Financial Position
3. the zen of long term financial planning

I glanced behind me at the supermarket checkout the other day (ok, I have a habit of looking at what other people put in their trolleys) and the bloke behind me was unpacking a trolley full of home brand and discount bulk items. I thought “Ah, a like minded shopper.”

It got me thinking about how we find partners who are financially compatible (did I mention he was also tall, dark and …) Of course, there are many values that should be considered when finding a life long partner, but with money cited as being the number one reason for divorce, should we be looking for a frugal partner right from the first date?

I never thought about financial compatibility when dating DH. In fact, if you had asked me what I was looking for in a fella, non-smoker would probably have been the only thing on my list. It just happened that we’re pretty much on the same page when it comes to money. Actually, he’s probably more frugal than I am. And our differences often provide a balance that would have otherwise been lacking.

So, it’s probably not cool to interrogate a person about their finances and money values on the first date. But if you’re engaged and ready to march down the aisle, it’s a good idea to discuss your ideas on money before the cake is eaten.

When it comes to dating, I can only think of two things that you should do to find that compatible someone. These tips are relevant for other values besides finances so maybe they’re just ‘common sense’.

1. Take notice of the person that you’re dating

Spending time with a person in different circumstances and taking note of how they act (and react), their likes and dislikes, what they say and what they spend their money on can give you a pretty good indication of what kind of person they are and if their values are a match with yours.

The first holiday DH and I had was a driving/camping trip up the east coast of Australia. If I had said I want to go to lie around some beach resort, or if he had said I want to go skiing in Canada, maybe things would have turned out different. As it was, our idea of a great holiday was the same and it happened to reflect our money values (and budget) also.

2. Don’t pretend to be someone you’re not

We all want to impress our dates. But pretending to be someone that you’re not isn’t the key to a life long partnership. It’s tiring and depressing, and you end up cheating yourself. If your idea of the perfect date is fish and chips on the beach, don’t go to a fancy restaurant just because it’s the ‘done’ thing. Stay true to who you are. If your date thinks that anything less than diamonds is stingy, then it’s probably not meant to be. I’m not saying never go out somewhere pricey, just be yourself. And if dating is eating into your financial goals, mention that, and suggest a more frugal alternative. Communicating honestly is what a good relationship is all about.

Do you think finances are an important consideration when dating? How would you tell if you’re financially compatible?

Have you read these articles?:

1. help a reader: love, marriage and money
2. Link love
3. the money talk