MoneyDigest - Personal Finance, Lifestyle, Money Saving Tips

How to Thrive When a Spender Marries a Saver

You’ve found the love of your life and decided to get married. However, as you plan for your shared future, you realize that one of you is a spender while the other is a saver.

Fortunately, there are strategies to manage joint finances that can satisfy both partners. Here are some tips for maintaining a balanced relationship between a spender and a saver that have been beneficial for me and my spouse.

TALK ABOUT YOUR MONETARY FEELINGS

Money often elicits strong emotions: it can cause anxiety or excitement, and managing it can either calm or stress you out. Before getting married, take time to explore each other’s feelings about money and the reasons behind them. Did you grow up in a household where money was scarce or abundant? Your upbringing significantly influences your money attitudes, and your future spouse might see things differently.

When my husband and I were engaged, we had a deep conversation about our financial upbringings. He grew up in a frugal household where every dollar was accounted for, while I was raised in a family that enjoyed spending on experiences and luxuries. Understanding these backgrounds helped us empathize with each other’s financial perspectives.

DISCUSS YOUR SPENDING PRIORITIES

One partner might value designer items, while the other enjoys an expensive hobby. Perhaps you both love to travel, aspire to own a home, or want to retire early. By discussing your desires, you can find common ground. Planning and saving for shared goals can ensure that both partners are satisfied with the purchases you make together.

We both love to travel, but I tend to splurge on spontaneous trips while my husband prefer saving for bigger vacations. By discussing our priorities, we agreed to save a portion of our income specifically for travel, allowing us to enjoy both planned and impromptu trips. If both partners agree, you can establish a clear plan for discretionary spending and saving for long-term goals.

CHOOSE PAYMENT METHODS WISELY

The pain of spending can be mitigated by using credit cards or small denominations of cash. One-click purchases and buy-it-now payments are also less painful. These payment methods can make spending less distressing for savers. Conversely, using cash, especially in large denominations, can make spending more painful for savers, though spenders are generally less influenced by the payment method.

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I noticed that my husband found it easier to stick to our budget when using cash. We decided to allocate a monthly cash allowance for discretionary spending, which helped us control our expenses better.

CONSIDER OPPORTUNITY COSTS

Many people, particularly spenders, often overlook opportunity costs at the time of purchase. When reminded of these costs, spenders tend to make more frugal choices.

For example, in a study where spenders had to choose between a S$950 and a S$1,360 stereo, they were more likely to choose the S$950 stereo when reminded that the cheaper option left them with S$410 in cash. This extra cash can be used for a weekend getaway. Highlighting opportunity costs can help spenders make more mindful decisions.

HIGHLIGHT VIRTUE IN SPENDING

Savers are more willing to spend on virtuous items, such as healthy food, compared to vices. If a saver is hesitant about a vacation, emphasize the virtuous aspects of the trip, such as quality time with family or the health benefits of relaxation.

SEEK PROFESSIONAL HELP

If you struggle to agree on a budget, consider consulting a financial planner. They can help create a budget that works for both of you.

Financial planners offer impartial advice and can determine whether certain expenses are affordable or should be postponed.

AVOID COMPARING YOURSELF TO OTHERS

Spenders and savers often have different life goals, which can lead to tension. Avoid comparing yourself to your partner as a way to justify your spending habits. This approach only deepens the divide and rarely resolves issues.

If you’re a saver, it’s easy to feel superior because you save more, but such feelings can harm your relationship. Remember, spending habits do not define a person’s worth or value in a relationship.

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By following these tips, you can foster a financially harmonious relationship. Embrace your differences, communicate openly, and work together towards common goals to ensure a happy and prosperous future.

Sources: 1 & 2

Making sense of disposable and discretionary income in 2024

Have you ever wondered what the difference is between disposable income and discretionary income?

Most of us have heard the terms thrown around, but do we really understand what they mean?

If you don’t, don’t worry.

Allow us to break it down in simple terms so you can wrap your head around these two important money concepts.

Defining disposable income and discretionary income

Disposable income: Your take-home pay

After your employer deducts CPF contribution from your paycheck, the amount left over is your disposable income.

It’s what you have available to pay for necessities like rent, groceries, and utilities.

For example, if you earn $50,000 annually but pay $10,000 in income taxes, your disposable income is $40,000.

That $40,000 has to pay for essential costs of living before becoming discretionary income you can spend freely.

Discretionary income: For fun and recreation

Discretionary income is what’s left from your disposable income after paying for life’s necessities.

This money is discretionary—you have discretion over how to spend it.

You might spend discretionary income on hobbies, entertainment, vacations, or non-essential whatnot.

For example, if your disposable income is $40,000 and you spend $30,000 per year on rent, food, insurance, and other necessities, your discretionary income is $10,000.

You can allocate that $10,000 for dining out, streaming media services, gym memberships, or whatever recreational activities you enjoy.

Making the most of your disposable & discretionary income

Set a budget

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The first step is setting a budget to understand how much discretionary income you have to work with each month after paying for essentials.

Look at your income and expenses over the last few months to determine an average amount left over.

Make sure your budget accounts for both short- and long-term goals.

Prioritize essentials

Focus on needs before wants.

Pay for housing, food, transportation, and healthcare first.

Look for ways to cut costs on essentials through budgeting, meal planning, public transit, or insurance optimization.

Any money saved can be added to your discretionary fund.

Invest in yourself

Use some of your discretionary income for self-improvement to increase your earning potential.

Take a course to learn a new skill, get additional education or training, and build your professional network.

While these may seem like extra expenses now, they can pay off in the long run through career advancement, and pay increases.

Reward yourself

After budgeting for essentials and investing in your future, spend the remainder of your discretionary income on enjoyment.

Treat yourself to a nice meal out, tickets to your favorite concert, a vacation, hobbies, or other leisure activities that you find personally fulfilling.

You’ve earned it!

Now, you should have a decent understanding of the differences between disposable and discretionary income. Disposable income is how much you have left over after taxes and necessities. Discretionary income is how much you can spend on wants after needs are met. While related, they are calculated differently. Knowing the distinction helps you budget and make smarter money choices.

There’s a limited edition Dr.G x Inside Out 2 skincare range with an ongoing 1+1 promo until 14 June 2024

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This exclusive collection merges the best of skincare science with your favorite animated emotions and it’s available for a short time only, with a 1+1 promo running until mid-June.

Dr.G pH Cleansing Red Blemish Clear Soothing Foam 150ml 1+1 Set

Promo Price: $24.51

First up, you will want to bid farewell to blemishes and say hello to soothed skin with the Dr.G pH Cleansing Red Blemish Clear Soothing Foam.

This gentle, yet effective cleanser tackles excess oil and acne-prone skin with a soft, creamy texture that won’t leave you feeling stripped or irritated.

Powered by a 5-CICA Complex and 8 types of Hyaluronic Acid, it hydrates and soothes even the angriest of breakouts, whether on your face or body.

Ditch the harsh scrubbing and let this pH-balanced formula do the work for you.

Dr.G Red Blemish Soothing Up Sun 50ml 1+1 Set

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Protect your sensitive skin with the Dr.G Red Blemish Soothing Up Sun 50ml 1+1 Set.

This moisturizing sunscreen delivers clinically tested SPF50+ PA++++ protection to shield your skin against harmful UV rays, infrared light, and environmental pollutants.

Formulated with Centella Asiatica-based CICA and 5 calming ingredients, this sunscreen helps alleviate heat-induced irritation and boosts moisture levels for a healthy complexion.

Dr.G Red Blemish Clear Soothing Toner 300ml 1+1 Set

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With key barrier-boosting ingredients, this toner fortifies your skin’s natural defenses for lasting suppleness.

Dr.G Red Blemish Clear Soothing Cream 70ml 1+1 Set

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The Olive Young and Dr.G x <Inside Out 2> skincare range is not to be missed. Don’t miss out on the chance to grab your 1+1 promo that’s as appealing as it is fleeting (only until 14 June 2024). It’s time to give your skin the star treatment it deserves, with a touch of animated cheer from the <Inside Out 2> characters 🙂

12 Hacks to Pack Like an Expert & Avoid Extra Fees

Packing can be overwhelming, even with the best or most expensive luggage. The stress often comes from not knowing exactly what you’ll need at your destination. To streamline the process and avoid unnecessary fees, here are 12 expert tips to help you pack like a pro.

PACK WITH A COLOR PALETTE

Choose a color palette you love, such as brown, black, or pink. Stick to this range for your tops and bottoms to mix and match outfits easily. This strategy maximizes wardrobe options while minimizing the number of pieces you need to pack. For example, a navy blue skirt can pair with multiple tops, creating several different looks from just a few items.

FOLLOW THE RULE OF THREE

Limit yourself to three pairs of shoes: one casual sandal or loafer, one pair of sneakers, and one evening shoe. Shoes take up significant space, so wear the heaviest pair during travel and pack the other two. This approach conserves space and helps distribute weight more evenly.

ARRANGE CLOTHES THOUGHTFULLY

Start by placing rolled, softer items like tees and underwear at the bottom of your suitcase. Next, add folded garments, starting with the longest items such as skirts and dress pants. Alternate waists and hems to save space, draping the ends over the opposite side. Fold shorter items like shirts at the hinge and snake belts around the perimeter to maximize every inch of space.

USE RESEALABLE BAGS FOR SHOES

Place each pair of shoes in a resealable bag to keep dirt and germs away from your clean clothes. Position the bagged shoes along the sides of your suitcase. This method keeps your clothes clean and organizes your suitcase more efficiently, making it easier to unpack upon arrival.

ROLL AND FOLD ITEMS

Use a combination of rolling and folding to optimize space. Roll softer items like T-shirts, underwear, and knitwear to prevent wrinkles, and fold stiffer items like blazers and dress pants. This hybrid approach ensures that your clothes arrive in good condition and allows you to fit more into your suitcase.

OPT FOR TRAVEL-SIZED, MULTI-TASKING ITEMS

Choose products that serve multiple purposes, such as a tinted moisturizer that acts as a foundation, or a combined soap and shampoo. This reduces the number of toiletries you need to bring. If you’re flying with a carry-on, remember to check current regulations for liquids to ensure compliance and avoid delays at security checkpoints.

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KNOW YOUR AIRLINE’S WEIGHT LIMIT

Be aware of your airline’s weight limits for checked luggage. Use a lightweight suitcase and pack with a handheld weight scale to avoid overpacking. This proactive measure helps you stay within the allowed weight limits, preventing costly overweight fees at the airport.

MAKE EVERY INCH COUNT

Utilize every bit of space, including inside your shoes. Roll up socks, underwear, or smaller items and stuff them into boots or sneakers to save space and maintain their shape. This technique maximizes your luggage capacity and helps keep your shoes in good condition during travel.

INVEST IN PACKING CUBES

Packing cubes are a game-changer for organization. Bring an extra cube for dirty laundry. When you return home, you can easily transfer the contents into your laundry basket without rummaging through your suitcase. This simple step keeps clean and dirty clothes separate and makes unpacking a breeze.

SPLURGE ON GOOD QUALITY TOILETRIES

High-quality toiletry bottles are worth the investment. They save space and ensure you have just the right amount of your favorite products. Durable bottles prevent leaks and spills, protecting your clothes and other belongings.

SHRINK DIRTY LAUNDRY

Use compression bags or cubes for dirty laundry. Graphic designer Jessica Ellis recommends Eagle Creek packing bags that can reduce the volume of your clothes by up to 80%. You can get the similar items from online retailers. This method is particularly useful for longer trips where laundry can accumulate and take up significant space.

KNOW THE HIDDEN COSTS

Always check for hidden fees associated with overweight luggage. Planning ahead and packing strategically ensures you stay within the allowed limits and avoid surprise charges.

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By following these tips, you can pack efficiently, avoid extra fees, and ensure a smoother travel experience.

Sources: 1 & 2

6 Secrets to Slashing Costs on a Cruise Holiday

My father recently found himself with some extra income. After diligently paying off debts, he realized that he and my mother could finally take a cruise and travel together for the first time since their kids grew up.

Cruises from Singapore or any part of the world can be expensive, but they don’t have to be. Here are six secrets we’ve discovered to help you save money on your next cruise holiday.

#1: BOOK EARLY

Booking your cruise early can often secure the best deals and the widest choice of itineraries and cabins. Many cruise lines offer early bird discounts and special promotions that can save you a significant amount of money. My friends managed to snag a great deal by planning their honeymoon trip well in advance, ensuring they got the cabin they wanted at a fraction of the peak price.

#2: LOOK FOR INCLUSIONS

When booking a cruise, the lowest price isn’t necessarily the best deal. Patton, a seasoned travel advisor, points out that the starting price doesn’t always reflect what you’re getting for your money. “Many small-ship cruise lines offer all-inclusive fares where excursions, beverages, and specialty dining are included. These can cost you a lot if bought separately,” she says. Michael Middleton of MyCruises recommends looking for deals that offer inclusions, such as onboard Wi-Fi for a set day rate, which can add up to substantial savings.

#3: AVOID PAYING FOR FLIGHTS

Flights can be notoriously expensive due to high demand and limited supply. One way to save is by cruising from your home port. Cruise lines like Royal Caribbean and Resorts World Cruises have departure points in places like Singapore, which can eliminate the need for pricey flights. My parents chose a cruise departing from Singapore, saving them a considerable amount on airfare.

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#4: CONSIDER PACKAGE DEALS

Bundling different aspects of your cruise holiday, such as flights, accommodation, tours, and transfers, can result in significant savings. Travel agents often have access to rates not available to the public.

Websites like Klook also offer package deals that can help reduce overall costs. Browse through their selections today.

#5: THINK LAST MINUTE

If your free time is spontaneous or out of the blue, consider last-minute bookings. These deals are often available during year-end promotions or when cruise lines need to fill remaining cabins.

#6: SHOP AROUND

It’s always wise to shop around and compare prices before making a booking. Different travel agencies and websites offer various promotions and discounts. My father spent time researching and comparing different options before making a final decision. This careful shopping around helped him find the best deal, ensuring a memorable and cost-effective cruise holiday for my parents.

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In conclusion, with a little planning and smart shopping, a cruise holiday can be an affordable and enjoyable experience.

Source: 1

Defining disposable income and discretionary income

Making the most of your disposable & discretionary income

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