Cheap breakfast cereal and a free cricket cap

Coles currently has 750g packets of weet-bix on special for $2.09. I checked the unit price (28c per 100g) and it really is a lot cheaper than the regular price, even compared to the bigger 1.3kg packs (around 55c per 100g). I bought four packs as there is also a special offer from Sanitarium for a "free" baggy green cricket cap at the moment. The first 20,000 people to complete an online entry with four codes (printed inside each box lid) receive a cricket cap at no cost. After I entered the codes and filled in the online application I received an immediate confirmation that I would be sent a cap (well, DS1 will end up getting it to wear), so they can't have reached the 20,000 cap limit yet ;)

DS1 should like the cap, as he has previously expressed an interest in playing cricket (he tried out for the school cricket team last year, but didn't get selected as he's never actually played any cricket!). Maybe he'll put it on and actually practice a bit with the bat and stump set I bought he last year ;)

Subscribe to Enough Wealth. Copyright 2006-2010

Going Solar

Our solar power panels were finally installed by NuEnergy last week. The installation only took a couple of hours, and the panels on top of our garage roof aren't even visible from the street. We now have to get the feed-in meters installed by the EnergyAustralia contractor so we can get paid for the power being generated. There was some mucking about regarding one of the authorisation numbers - when DW phoned the meter installation contractor he said we would need to get a "CEC" before he could order the meter, but after a few more phone calls to EnergyAustralia they confirmed we had already made all the necessary arrangements when we placed the order last October. It's just as well, as otherwise we would be paid at the new (much lower) feed-in tariff for the next couple of years.

Hopefully now that the meter has been ordered the contractor will make an appointment to install it in the next couple of weeks, and we can start earning some money from "green energy" to pay for the (subsidised) cost of the PV system.

ps. I phoned our insurance company and increased our building insurance by the full value of the PV system (around $13,000). If we get hit by one of the massive hail storms Sydney sometimes experiences, we would have to pay full price to replace the PV system, not the $3,000 or so it cost this time around.

Subscribe to Enough Wealth. Copyright 2006-2010

Public or Private High School? - a question of fees, fees and more fees

2011 will be a big year for DS1 - he's in the final year of Primary School (Year 6 in the NSW system) and will be sitting the selective high schools test and private high schools selection and scholarship tests over the next couple of months. Fortunately there is a good local public High School available (the one I attended), so it won't be a major drama if he doesn't get a place in one of the four selective high schools he nominated on his selective high school test application. I've also had him on the "waiting list" for Sydney Grammar School (one of the state's best private high schools) since he was one year old, but he may not get a spot as a) those who have been attending the Sydney Grammar Prep School for the seven years of primary education get automatic entry, b) sons of "old boys" and those with siblings already attending get higher priority than those on the "waiting list" to enter in Year 7. In any event, with the high annual fees (At AUD$22941 per annum (for Forms I - VI, non-boarding), the tuition fees are among the highest of any secondary day school in the country) DS1 would have to do very well on the scholarship test and win one of the dozen or so available scholarships for us to be able to afford sending him there for six years of secondary education (especially as DS2 is also on the Sydney Grammar waiting list, so would probably also attend Sydney Grammar if DS1 went there).

An article in today's SMH states that private school fees have risen 100% over the past ten years. So I have to wonder if it would really be worth spending the large amounts of money required to send DS1 and DS2 to private school anyhow. Sydney Grammar was originally established as a "feeder school" for Sydney University, but nowadays there is no problem getting a place at Sydney Uni if you get a good enough mark in the Higher School Certificate exams in Year 12. And, depending on your field of study, one of the other universities in Sydney woulde be a better choice (eg. NSW, UTS, or Macquarie). And if DS1 doesn't do well on the HSC there's always UWS ;) . These days the high school you attended doesn't have any direct influence on university entrance, and I suspect a private school education has also lost a lot of the career benefits the "old boys network" used to have in the past (similar to how membership of the Masons used to open more doors in the past). There seem to be a lot of "old boys" that ended up with fairly mediocre middle management careers despite the benefits of attending private school for six years - and in those cases the money spent on fees would probably have been better spent on setting the children up in their own business after completing uni.

So, although it would be nice for DS1 to win a half (or full) scholarship and be able to attend Sydney Grammar, I don't think he would be significantly better off than if he is able to attend a selective high school. Academically, he might even be get more benefit from selective high school than private school. If he does well on the upcoming tests and has the choice of either a half-scholarship to Sydney Grammar or entry to one of the better selective high schools, we'll probably choose selective high school due to the cost of private school. On the other hand, if we were choosing between a half-scholarship for Sydney Grammar or attending his fourth choice Selective High School, we'd probably try to scrape together the funds to send him to Sydney Grammar. In reality, DS1 will most likely end up attending the local non-selective public High School. He didn't do well enough on the "Opportunity Class" (years 5-6 of Primary School) test two years ago to win an OC place (I did), so, although there are slightly more Selective High School places available than OC places, he may not have the opportunity to attend either private school or selective High School.

Subscribe to Enough Wealth. Copyright 2006-2011

10 challenges that face Australia (and the world) - but what about the elephant in the room?

An interesting article in the SMH by Kevin Rudd (our ex-PM) lists what he considers to be the ten great global shifts and challenges facing Australia. Aside from being a bit too self-congratulatory about what a 'you beaut' job the Australian Labor party is doing at running the country, I think the big problem with this article is that is totally ignores the underlying problem that has created most of these issues - global overpopulation.

There was a brief flurry of attention in the 1960s when the 'club of rome' came out with the "Limits to Growth", but the ZPG movement didn't really go anywhere, except in the case of China's draconian one-child policy. In the 80s and 90s constantly dropping commodity prices seemed to contradict the view that there were any limits to growth, but this century it appears that rising commodity prices, peak oil, water shortages, rising food prices and the increasing impacts of natural disasters (due to more people living in affected areas) have confirmed that there are limits to sustainable growth, and we are rapidly reaching them (or have passed them in some aspects eg. rate of carbon dioxide production). Yet there is little attention paid to reducing rates of population growth (eg. India, South American, Africa) in regions that would benefit from having less people to support - instead more attention is being directed to perceived problems of aging populations in the parts of the developed world that have achieved ZPG (or NPG). There was a brief public discussion of what population limits Australia should aim for over the coming decades (stimulated by recent upward adjustment in population projections out to 2050), but that too has gone very quiet recently - with politicians realising that it would be much more challenging to maintain economic growth without the automatic stimulus of a constantly growing population.

Surely restricting population growth by taking active measures to encourage a maximum of two children per couple globally is the most cost-effective, painless means to solve many of the challenges facing the world?

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I hate paying for my toys when I can't even use them

The annual registration renewal notice for my Scat Hovercraft ($56.50) just arrived, along with a reminder notice for the registration of my boat ($92.50). I wouldn't mind paying these annual registration fees if I was able to actually use the boat and hovercraft, but for the past five years they've both been sitting up at my parent's lakeside farmlet gathering dust (and probably need a major overall by now). Hopefully this year my parents will finally renovate the farmhouse and I'll be able to take DS1 and DS2 up there during the school holidays to play with my "toys".

(my boat is a slightly older model than this one)

 

Subscribe to Enough Wealth. Copyright 2006-2011

A Belated attempt to KISS

When the markets were booming it seemed to make sense having three separate margin loan accounts, plus other broker accounts for training US stocks, options and CFDs with Commsec. Post-GFC the principle of KISS (Keep It Simple, Stupid!) has a lot going for it. So I continue to slowly rationalise my stock and fund portfolio...

Today I sold off my holding of IANG [IAG FINANCE (NZ) LTD] as I'd made a reasonable gain and there were little prospects of further price appreciation with the stock trading around $104 for what is basically a company debenture with a face value of $100. Although the yield is fairly attractive it didn't make sense to keep owning this stock when I'm paying almost 10% margin interest. I also put in an order to sell off the last of my direct US share investments (220 shares of Microsoft), as the potential gains aren't worth the paperwork hassles and account keeping fees of having a US trading account through Commsec. As soon as the trade settles and I transfer the balance of the account back to Australia I close this account down. Again, the dividends flowing from this stock were negligible, so I'm better off using the proceeds to reduce my Australian margin loan balances a bit. I'll also sell of the two varieties of Westfield stock (that resulted from the recent Westfield demerger). I'd also like to get rid of the tiny tranche of AEJ [ALINTA ENERGY GROUP] shares I ended up holding when one of the Babcock & Brown funds was wound up, but the cost of the share trade would be more than the proceeds! So I'll have to wait until I get an offer for some free stock trades from Commsec.

After this pruning is finished, my stock and fund investment portfolio (outside of superannuation) will be:

The total value is around $450,000 which will be about the same as the total outstanding loan amounts (including the $235,000 HELOC used to fund some of the investments that have 0% margin value). As the overall interest rate is about 8%, the total return (dividends plus any capital gains) isn't likely to produce much net return. At best, it produces a modest tax benefit by deferring current income tax (as the amount by which the tax deductible margin loan interest exceeds the dividend income is deductible against my salary income) and creating a long-term capital gain tax liability, with long-term capital gains being taxed at half my marginal income tax rate. The potential benefits hardly outweigh the amount of complication added to my tax returns, so as soon as the OMIP and Macquarie equinox funds reach their maturity date (when their capital guarantees kick in and I can get my initial investment back!) I'll use the proceeds to pay off some of the margin loans rather than reinvest.

Subscribe to Enough Wealth. Copyright 2006-2011

Amazing flash flooding in Queensland

It's been raining a LOT this summer, due to the 'la Nana' effect in the Pacific ocean between Australia and South America (the opposite effect, 'el Nino' regularly causes droughts here). But in the past week Queensland has been getting additional heavy rainfall which, with the ground already saturated, is causing flash flooding. Even parts of the capital city, Brisbane, are now under threat.

One amateur video available from the Sydney Morning Herald website is amazing - the swollen creek has a flash flood that washes away parked cars within minutes. I think the person who rescued his 4WD was a bit daft though - I would rather have let my car wash away than risk being swept away myself.

So far there are ten confirmed dead, and about 78 missing. With more rain expected over the next couple of days...

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Do you like the new colour scheme?

I felt the black scheme was too hard to read, so I've chosen this new scheme (with astronomical background). Use the "rate this post" tool to give it a score from 1 to 5 ;)

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Annoying 'test' transaction on my credit card account

I was checking the 1/1/2011 opening balance of my credit card account online when I noticed that an odd 'purchase authorisation' transaction for 10c had been processed on the 4th. I'd read somewhere that crooks will often make such a small transaction using stolen credit card details, and if the transactions gets processed without any problems they will then make large purchases a few days later. It seemed especially odd as the transaction was visible in the online transaction listing, but was missing from the electronic monthly statement that included transactions up to the 7th.

So, this morning I phoned the bank to check what the transaction was for. After being on hold for ten minutes before getting through to a customer service rep, I then had to wait another five minutes for her to find out that the transaction was 'probably' a test transaction done by FlyBuys. Apparently before they processed my recent request to 'redeem' some rewards points for a $100 credit onto my credit card account, FlyBuys made the test transaction to check that the CC account details I'd provided were valid. This 'test' transaction should be reversed off my account eventually. All in all, a total waste of my time.

Subscribe to Enough Wealth. Copyright 2006-2010

Making progress

I feel I had a fairly productive weekend - I started assembling the six 'cube' bookcases I bought from Aldi 18 months ago, and so far things are going OK (the first two packs went together easily and the finished product looks even better than I expected). Next weekend I'll need to assemble and then cut in half two of the remaining bookcases, so that the resulting 'L-shaped' bookcases can fit either side of a large, teak carved panel that is the feature piece of our lounge room. I visited the local hardware 'superstore' today to buy the few planks of DAR lumber I'll need for installing the wood carving and putting ends onto the four half-bookcases, a small tin of varnish/stain, a paint brush, some removable picture hooks and an el-cheapo jig-saw for cutting the bookcases... total cost just under $150! The timber was quite expensive considering it was only cheap plantation pine (and full of knots), whereas the jig-saw for less than $20 was a bargain. I paid the hardware store $4 to have the timber cut up into the required lengths as I'm not sure exactly where my circular saw has gone. I'll varnish the raw pine pieces after work this week and should be able to assemble, cut-down and install the corner book cases around the teak carving next weekend. That will leave one more weekend to finish off the project while DS1 is still visiting my parent's farm.

I've made progress with a couple of my other goals - sticking to my diet (lost 2kg in the first week - mostly water I expect), and also making it down to the air pistol range yesterday and shooting a decent score (533/600). Not quite 'A grade' (540), but close enough considering I hadn't done any target practice for nearly 12 months.

I also finished off my 'final' draft of the application for an AAO student fellowship position and sent it to my MAstron lecturer at JCU for some review.

All in all, decent progress on 3 of my 12 goals. I've decided to change on of my goals though - after installing Quicken 2008 on my 'new' laptop on Friday, today when I launched Quicken a message popped up saying that it had been previously installed on a different computer (my old desktop), so I'd have to phone the Quicken support (toll charge) number to be able to use it on my new PC. Instead I've uninstalled Quicken and decided to track my expenses using an excel spreadsheet this year. It's much easier to keep a spreadsheet on my USB stick so I can update it at home or at work than try entering everything in Quicken at home, and Quicken was over-kill for my needs this year anyhow.

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Goals, New Year Resolutions, and other fantasies

I don't think I even bothered doing a post about my goals last year, but looking back at my 2009 post I can see that I still haven't achieved several of my main goals, so here they are again for 2011, plus a few new ones:

HEALTH: 1) Lose weight and 2) exercise more:

After losing a few kg when I was sick last year, I put it all on again. So I still have to lose about 20kg to have a healthy BMI, and ideally I should lose 25-30 kg. I also want to achieve at least 3.2 METS of exercise 3x a week - preferably every day. This week I've lost 1 kg by sticking to my 'standard' diet since the 3rd, and exercising 3 days (avg. 2.25 METS).

My 'standard' diet (at the moment) is:

Breakfast:
100g apricot halves in juice
125g tub of mandarin segments in syrup (drained)
1/2 of 420g tin of pineapple pieces in juice
1 glass grapefruit juice

Lunch:
420g tin of baked beans
2 slices hi-fibre bread

Dinner:
100g meat (skinless chicken breast, fillet steak, pork fillet or tin of tuna slices in spring water)
150g frozen vegs (eg. peas, carrots, broccoli, corn)
2 slices bread, or 100g boiled rice, or 2 medium roast or boiled potatoes.

Dessert:
1 apple
1 banana
1 orange, or 100g grapes

I also consume about 1-2 2L bottles of diet coke each day, which I'd like to reduce. I'll try replacing one of the bottles of coke with a bottle of filtered water flavoured with 1 soluble aspirin. I should also switch to 'no added salt' baked beans, as the normal baked beans contain around 1000mg of Sodium (salt). I suspect I might be sodium-sensitive, so restricting my sodium intake to under 2,000 mg/day might let me reduce my blood pressure medication once I lose some weight.

Overall, this 'standard' diet provides around 1,800 kcals/day which would result in around 0.75 kg/week weight loss initially. As my weight reduces my maintenance calorie requirement will decrease, so this diet would be sufficient for me to maintain a healthy weight of around 70-75 kg in the long term.

This diet plan also provides high dietary fibre (~40-50g/day), low fat (~5% of daily cals), and about 80-100 g protein. As I also take some vitamin supplements it should be reasonably healthy over the long term, being similar to a moderate level of CRAN (Calorie Restriction with Adequate Nutrition) which some animal studies suggest could help maximise life span. If nothing else, the weight loss would provide immediate health benefits!

BUDGET: 3) Track my expenses using Quicken to help stick to my budget:

I start each year setting up a new Quicken file but then not keeping it up to date. It used to be easy (before I got married and had kids), but I'll try to find the time this year. So far so good, although I haven't yet entered all my stock holdings and purchase details (which would make tax time a lot easier).

I seemed to have a higher than expected CC bill almost every month last year, so this year I'll try to stick more closely to my budget.

SAVINGS: 4) Save and 5) Pay off some debt

My retirement (superannuation) savings are on 'autopilot' (my employer SGL amount and salary sacrifice get automatically deducted from my pay each fortnight), and the home loan and margin loan interest payments don't vary much from one month to the next, so this shouldn't be too hard. One of our home loan mortgage accounts is due to revert to variable interest this year, but the rate increase should be offset by the recent increase in rental income from our investment property. On the other hand, everything is currently on 'interest only' and we didn't manage to pay off much of the loan principal last year.
So, another goal for this year is to reduce my total investment debt balance by $12,000 this year. I'll calculate my investment loan balances as at 1/1 in the next post and calculate them each month when I do my Net Worth post.

WORK:

6) Keep my job! ;) (And maybe get a pay rise that's more than the inflation rate this year?)

STUDY: 7) Get Distinction (or better) for my MAstron subjects

I'm enrolled in another two subjects for my Masters of Astronomy course this year. I'm aiming for a High Distinction in one or both of these subjects. I won't include getting a student fellowship at the AAO as a goal, as realistically it's a very long shot, and the outcome is pretty much out of my control.

HOBBIES:

8) Attend the target range often enough to keep my shooter's licence. I should also setup my 'SCATT' computerised training system at home so I can do some 'dry fire' target practice and get back up to A-grade standard.

I haven't had any success using my CCD camera with DS1's small telescope (can't bring the image into focus), so I want to 9) install a permanent pier for my 10" telescope in the back yard and get started on differential photometry and astrometry of minor planets (asteroids) this year.

10) Build a new base board for my old HO railway setup, so DS1 and DS2 can have some fun with all the model railway stuff I have packed away in our garage.

11) Finish landscaping around our swimming pool.

12) Renovate our lounge room/library and setup the aquarium I bought last year.

**************************************

So, an even dozen goals for this year. Maybe tracking progress towards them each month will help achieve them?

Subscribe to Enough Wealth. Copyright 2006-2011

Net Worth Update: December 2010

The stock market posted some solid gains this month, so both my geared stock portfolio and retirement savings account increased by around $10,000. Our property valuations also rose a bit during the month, so my overall net worth figure increased by about $28K (~3%). As the USD had dropped below parity with the Aussie dollar by the end of 2010, my NW is slightly more in USD terms than the AUD amounts shown here and on NetWorthIQ.
My "stretch" goal for 2010 was to break the A$1M net worth again (last seen in 2007). I didn't quite regain that milestone but it is looking very "do-able" from here. For 2011 the Australian economy looks to continue growing, unless the Chinese "economic miracle" falters. But with almost "full" employment in Australia we are likely to see the RBA increase the cash rate several times during 2011 unless we get negative GDP quarterly figures. A rate hike would make Australian real estate even more unaffordable for first home buyers and put downward pressure of real estate prices, so I expect our real estate portfolio won't repeat the healthy gains seen in 2010. We may even see a price decrease in real terms (ie. adjusted for inflation).

Assets___________$ Amount______$ Diff_____% Diff 
Stocks_*__________$26,717_____$10,226______n/a % 
Retirement_______$358,678_____$11,110_____3.20 % 
Properties_______$949,702______$6,945_____0.74 % 

Debts____________$ Amount_____$ Diff_____% Diff 
Home Mortgage(s)_$363,552_________$81_____0.02 % 

Net Worth________$971,576_____$28,200_____2.99 %

* the Stocks figure is portfolio value - margin loans. As my portfolio value (and margin loan debt) is around $500,000 relatively small movements in the stock market produce huge percentage swings in the net value of my stock portfolio each month.
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