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Commandments of a Cheapskate 11

Back by unpopular demand.
With the economy under strain it’s even more important to ensure that you have some cash for emergencies. Picture: Shutterstock

Warning: This column contains sarcasm and brutal honesty. Reader discretion is advised.

It’s been a while, I know.

To be honest, I’ve had some trouble coming up with anything meaningful to say over the last few months. I am still struggling but have decided to meet readers halfway and say something mean. Unfortunately, the Oxford English Dictionary doesn’t recognise the word “ingful” yet.

You see, it’s one thing to tell people to save and invest when things are going well. It’s something different when expenses are skyrocketing while salary increases seem to have gone missing. Taxes have been rising, the fuel price has gone crazy, the rand is in the doldrums and despite some columnists best attempts at writing up the JSE’s performance with their never-ending cheerfulness, money has been tight.

To add insult to injury, the expense mob has come knocking.

First, the City of Johannesburg (CoJ) in its wisdom decided to reclassify my high density residential property as a sectional title business. I checked the new market value during the revaluation process but must admit that I was naïve enough to think that it was impossible that the “category” of a run-of-the-mill residential property could be changed during the process. So in July I got slapped with a bill that was more than three times the usual amount, even though the valuation was only 18% more. Of course, I have not been paying the monthly bill in full, but my research suggests that it can cost more than R5 000 to get the classification fixed by an outside party. (As a law-abiding citizen, I have turned a deaf ear to suggestions of using an inside party.)

I realise that I can try and fix it myself, but my estimation is that the cardiologist I would need afterwards might be even more expensive. For the moment, I am trying to find comfort in the fact that the CoJ’s aerial camera technology has now advanced to the point where they can spot people burning the midnight oil at their homes while simultaneously, with a little help from Eskom, taking steps to stop them from burnout.

And then there is my car. Regular readers of this column will remember Goldie, my Toyota. She recently turned 13, still has relatively few kilometres on the clock and is as reliable as ever. But when I picked her up after her recent service, I almost had a heart attack. (In hindsight, I should have scheduled my call to the CoJ call centre on the same day – I could have saved a lot in cardiologist fees.) The service agent handed me a quote for “urgent work”. Apparently, the only things that didn’t need to be replaced were the indicators (I assume this is only because it is not a BMW). Luckily the service centre was kind enough to keep the quote a whopping R550 lower than the car’s insured value. Business must be booming.

“Didn’t you hear any strange noises while driving?” the service agent asked.

Lady, the strange noises you are hearing are not coming from my car, that I can assure you, I thought.

I may be ignorant, but there was absolutely no indication that there was anything wrong. Despite suggestions to the contrary, men don’t name their cars after women because of appearance – it’s because you know immediately when you have neglected to pay attention …

For someone who carefully budgets and plans ahead for months where irregular expenses will have to be paid, this has been a tough pill to swallow.

The unfortunate reality is that no matter how careful you manage your finances, there are bound to be unexpected mishaps. The idea is to structure your financial plan to give you the best chance of overcoming these roadblocks so that the setback is only temporary, and you don’t fall into a debt spiral.

Unfortunately, planning for such eventualities may fall by the wayside. As humans we are wired to focus on immediate needs. In South Africa, this may be exacerbated by unemployment and inequality, which leave many people with little choice but to try and make ends meet today.

According to the Momentum/Unisa Household Financial Wellness Index 2017, only 17% of South Africans who are considered financially well have a comprehensive plan that includes providing for emergencies and unplanned expenses. Only about 60% of them will be able to cope with an emergency requiring R20 000. (If you are part of the 40%, consider this a warning not to visit a certain service centre in Johannesburg.) The stats are much worse for those who are financially unwell – almost three-quarters of households.

My experience underscores the importance of an emergency fund. But before you dip into your rainy-day account, look at the situation critically. Just because someone comes knocking with a quote or invoice, it doesn’t necessarily mean that it must be incurred or paid. As I write here, I am convinced that at least some aspect of the repairs is not immediately necessary.

Moreover, there is often a case to be made for shopping around. Although this type of expense makes a like-for-like comparison difficult, the first comparative quote I obtained (40% lower) suggests that there is significant scope to negotiate a better offer. Unfortunately, the CoJ situation doesn’t leave me with all that many options.

With the economy expected to remain under strain for the foreseeable future (Moody’s on Thursday revised its real economic growth forecast from 1.5% to between 0.7% and 1% for 2018) it is imperative to take a hard look at your finances, update and revise your budget (and stick to it) and ensure that you have some cash for emergencies. 

Also, even if sarcasm is not your thing, try and see the lighter side of things. It can save you a lot in cardiologist fees.

PS:. If anyone knows a mechanic in the northern or western parts of Johannesburg who would be able to pass a lie detector test (they don’t have to pass on their first attempt), kindly send me their details.

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Lie detector test for mechanic LOL
Time to let go of goldie dont over stretch the commandment of a cheapskate

Why? Because some business is trying to rip her off? She will only change the rip-offer (aka the local motor vehicle retail industry) if she buys something new (compare local vs international prices of the same vehicles).

Inge thank you – just what my ‘cardio’ needed after what’s been a very bad week. In our office alone at least 80% of employees cannot cope and barely survive from month to month as most are also now forced to care of an elderly parent or parents. Me thinks that everyone is too scared to do an in-depth enquiry of the strain being experienced by ordinary citizens as the actual figures will be a shocker.

CPI is a figment of STATS imagination at current levels

I made a spreadsheet which allows you to calculate your own personal inflation rate – it’s interesting to compare with official CPI
Calculate Your Inflation Rate

I remember the good old days when replaced parts were left on the passenger mat of your car, and any expensive replacement required your authorisation.

Still like that today with Toyota and V W.

BMW also does it. At least the ones in the Western Cape.

I have the quotes and images to prove the following if any journalist is interested:

I do not think the public is aware of exactly how much we are being overcharged by OEM dealers. My Nissan Tiida’s airbag light came on and Nissan said that it needed a new “Spiral Cable” – part 5567EV06E. They quoted me R7050 – a quote that i unfortunately threw away (they later quoted me R3625 for exactly the same job when i needed a quote as proof to send to the press). Two things:
Their 1st quote was for 5.5hours labour – at R855/h!, the 2nd was for only 1.5 hours. I’m not a mechanic but after watching a video on YouTube it took me only 2.5 hours to install the part – I will easily be able to do it in 1 hour if I must do it again.

Secondly, the part alone was quoted at R2343. I found the part on Ebay from a manufacturer in China for only R220 – I kid you not. It arrived a few weeks later and the post office charged me an extra +-R25 for import duties. So, in total the part cost me R245!
There is little press about “the right to repair” now and again and it is justified. I would understand a 10 or 20% premium for oem parts- but 10 times the price – that’s exploitation.

Keep the car it’s good many more K’s of use,, just get a good service org./mechanic! Shop around!
Enjoy!!

Inge, by postponing the purchase of a new/newer car for so long already, you have already saved you a trillion 😉 bucks in depreciation (and interest on installments), and fairly cheap car insurance costs based on a low-cost asset.

The idea is to set money aside during such long-term cost-saving, so that when the time comes when you buy a newer car (preferably NOT new), you can pay CASH & be financially free in that respect.

(…unless if you receive a Car/Travel Allowance within your pay structure, or if you’re an Independent Contractor/Commission-earner…yes, then you can spend more on say a new car, as SARS subsidizes a chunk of that cost).

When buying a vehicle, the golden period is somewhere between 2-4 yrs old, where the bulk of depreciation was kindly carried by the 1st owner, and the car still relatively new enough to last a long service life. (yes, some will argue, you’ll get a warranty/maint.plan/peace of mind when you buy brand new. Those who say that live in the belief and fear that once the maintenance goes, the car will explode right there and then). The cost premium one pays for motoring peace of mind on new car (i.e. maint.plan/warranty)…almost always outstrips the long-tern maintenance cost of a used car without a warranty. (And new does not guarantee no hassles, despite that one pays for exactly that.)

It depends really on the second hand market, cars with perceived good build and longevity tend to depreciate slower and you need to buy them later on.

I recently bought a car new for the first time because there was such a small gap to the used market that it didn’t make sense to lose a year of motor plan, not ideal but I plan to drive it for at least 6 or 7 years.

One needs to realise that a one-year motor/service plan, is in most cases just going to cover for a SINGLE “free” service within any 12-mnth stretch. Calculate what the cost of that service would be.

(OK maint.plan also covers items like tires: how many times within 12m do you replace your tires? Or your shocks?)

Peace of mind yes. Cars are generally so well designed without having technical issues before 100,000km in any case. A 2-3 yr used car, the breakdown risk is still fairly remote, while the cost price is pro-rata even less.

Cars are fairly reliable. Even a 30-year old Alfa, which never had a service, will probably give a person less trouble on one’s trip to the Cape or Gauteng…compared to a brand new desktopPC/Laptop/Tablet which WILL always have some software issues & frustrations to sort 😉

My sympathies Inge. During a Toyota dealer service I got a call to say that the water pump needed replacing at a cost of R4600.00. I flipped through my files and told the caller that I had in front of me an invoice for a replacement water pump some 20000kms earlier and the invoice proudly declared “Genuine Toyota Parts”. Why then, I asked, had the water pump fitted on delivery of the vehicle lasted 130000kms whilst the replacement “genuine” article lasted only 20000kms.Caller said she would call back. She did and said “there is nothing wrong with the water pump”. Did someone in the workshop need a new water pump?

I can relate. I replaced both front shocks on my (now sold) Ford at a fitment centre, including labour, for the price of a SINGLE shock (unfitted) as quoted to me by a Ford dealership.

Again, was the replacement really necessary? How do you know? Did you examine and test them yourself?

Not saying they weren’t, just illustrating, as per Bewildered above.

Definitely was necessary. Both were shot. One was leaking.

Ingé your good old reliable Toyota finally has to go, (more likely because parts are no longer available, not because of unreliability of the car), because it is very under-used, you don’t have to but another car, which will be at ridiculously high prices per the kilometers it travels.

Rather put the money aside to use Ubers (or taxis or whatever hire travel) wherever you go around town. You can hire a car when you go long distances, like your annual trip to Mossel Bay or Pofadder or wherever.

Do the sums. you’ll be amazed at how many Uber miles you can travel for the cost of a new car, that would spend most of its life idle in its parking space, that you could also use for something better.

Ha! the only reason I used to read some of the crappy moneyweb articles was for the free market data but now that’s limited and I’m asked to subscribe to read said crappy articles!
Goodbye moneyweb from one cheapskate to another.

End of comments.

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