The Hidden Path To Untold Treasures:

While we normally interview home budgeting experts or people who have fought their way out of debt. This month we are interviewing a couple of girls who have written a book on life, love, positive energy and yes, home budgeting. Shannon Thomson and Kate Filmer have discovered the Hidden Path. And their new book is about how you can find it in your life. We have reviewed the book, click here to see it.

Both women have come from diverse backgrounds where money was not in ready supply. However, that was then and this is now. They now live in beachfront mansions (right on the beach). And would you believe, they live next door to one another. And their money problems seem to be well and truly gone.

Their book is not 100% devoted to saving money. However, they do make some extremely good points and we are happy to discuss their philosophy on budgeting. If you would like to learn more about them, go to their website Click Here

So for the people who don’t know exactly who you are, maybe you can tell us a little about yourselves.
Kate: I have been a jack-of-all-trades and master of none throughout my life. Until now! I have been a hairdresser, landscaper, I owned a coffee shop, ran retail outlets, worked in hospitality, worked in pubs and restaurants. So really, as I said a bit of everything. However, I started my own bookkeeping business once I had kids.

I came about the bookkeeping business after helping two really struggling businesses with their finances and budgets.

Shannon: I was a high school dropout. My life really had no purpose until I hit 21 and had kids with my husband. I always had an entrepreneurial interest. So my husband and I started our first business. He was a landscaper so we went into that. He did all the horrible physical work and I did all the marketing, bookkeeping and backend stuff. Since then, we now build properties, have an importing business and have holiday properties.

Kate and I have a lot of similarities. We both had our kids around the same time. We live next door to each other. Even our dogs on either side of our fences are brothers and sisters. We may have taken our working relationship a little too far; we see more of each other than we see of our husbands.

So you have written a book? How did this come about and is it going well for you?
Kate: After having my kids I fell into a bout of depression and I was very unwell. I had a kidney which was failing. For a young person I had a lot of health problems. Emotionally and financially we were really struggling. To make matters worse, my husband was about to lose his business and we were on the verge of losing our home as well. At the time we didn’t realise, but the universe was pushing us out of something, but towards something even better. But at the time, we just thought life sucked.

But then we changed our attitude towards money. We started looking into things and reading a lot; focussing on a positive way of life and money coming in, instead of the bills. Nearly right away after this attitude change, my bookkeeping business picked up and my husband found a really great job. Things just totally started changing.

And on the backdrop of this, Shannon and I started writing the book. Now I have not only rid myself of my money problems, but my health problems have gone away. I no longer feel sorry for myself, which is the way I used to live. Now we live in million dollar mansions right by the beach; life is totally different.

Shannon: Our book is as much about saving money, as making and creating money. So while we have written the book we are always looking for other opportunities. In fact we have just had a meeting with a network about doing a TV show pilot in the future. Plus we have just finished a new iPhone application. We never stay still and are not happy with just one project. Once we finished the book we were looking for something else. We follow through on our ideas, and this is what the book teaches you to do.

So were you always good with home budgeting?
Kate: No way, not when I was younger. When you get a mortgage and you really have to start saving money for the mortgage, you really need to learn to be disciplined which took my family a while. But once we became disciplined, we used to do amazing things with the money coming in; stretching it as far as it could go.

Shannon: Once you work out what you’re saving for, you can easily start buying home brand groceries for example. Because each dollar you save allows you to put it towards something you are interested in and passionate about; saving money for a specific purpose makes you want to find more saving opportunites.

Kate: Even now that we are making good money it doesn’t matter how much money we bring in, I will still budget and save because I know we can spend that money elsewhere. We have a TV show interview coming up soon on home brand products about how far the taste and quality has come. Plus just how cheap the prices are, and we can’t see the point of spending extra money on brand name products when home brand is so good nowadays. There are so many opportunites in life in general, where you can spend less money on a range of different things, but have the exact same experience.

Shannon: My star sign is Taurus and we are known for being extremely good with our money. Right from my childhood I was extremely good. When I left home at sixteen, all my friends would come to me and say, “Where do you get your money from?” Because they thought I was rolling in it. At the time, I actually hardly earned anything, however I had all the money to do the things I wanted to do because I would save it in all sorts of areas.

Going through this period gave me great budgeting skills. Once I had my family I knew of how to juggle everything and make the budget stretch. Even now, I’m still asked by friends, to come over and help them with their budget.

So what do you guys find are the biggest mistakes people make when doing a home budget?
Kate: There are two things which pop into my mind:
1. People don’t research enough.
2. People believe the world is out to get them and things cost too much.

I always have the belief that no matter what happens in life I will get a bargain. And this belief system allows me to find things at the lowest price each and every time.

A lot of people really have a negative mindset when it comes to purchasing and their money situation.

Shannon: For me its how people structure their debt. If they have credit card debt which they are never going to pay off or they have a personal loan, home loan and car loan and all these loans have different percentages, different terms, and payments. This can be extremely hard to juggle. For example, the quickest way to get rid of one of your debts is to get rid of the credit card debt. Get rid of it and cut it up. Most people don’t know that if they only pay off the minimum repayment it will take them 20 years to pay it back.

Kate: It’s funny but people seem to think if they have a credit card it’s their money. I was always scared of getting a credit card and this was something which my parents instilled in me. They would tell me never to buy anything unless you have the cash. This was a massive lesson which I stick to even now.

Only once in my life, when we were in a really bad spot financially, I paid interest on my credit card. This was the most painful bill of just over $100 that I have ever spent in my life because I kept thinking this $100 was for absolutely nothing. So a credit card for me is only used for the point programs; I get some free flights.

We really seem to live in a debt-filled society and there is no subject on home budgeting at school. Don’t you think we should be teaching our kids how to run a home budget?
Kate: The home economics at school where you learn how to sew is garbage. It is so old fashioned. It should be a core subject that we should be teaching our kids.

This subject needs to be there. We need to teach from an early age what a credit card is, what a minimum repayment means, how a home loan works, and how to save. It really needs to be a core subject in the school system.

I have never ever spoken to anyone about this issue who has disagreed that this subject should be taught in schools. It just seems so necessary and so sensible.

In your book you have some exercises for people to do, to help with their home budget. I will write them out as written in the book and if you could talk us through why they are so important?
Exercise One – In the table provided at the end of this chapter or in your Journal, we would like for you to estimate what you think you are spending on a weekly basis and fill in your answers into the column ‘Initial Estimate’. This is an estimate, however be as honest as you can be at this point. This will enable you to be clear about your financial situation and also assist you to recognise areas in which you may spend excessively. Plus this will also point out any shortfalls you may have between your financial ingoing and outgoings.

Exercise Two- Now spend the month finding out the true figures by recording everything, and we mean everything you spend. There is generally a difference between what we perceive we spend, as to what we actually do. Analyse your bills; for example: if you pay your phone bill monthly and usually you spend about $80.00 a month, divide the amount by four (weeks per month) $20.00 per week. If you pay a bill amount by 52 (weeks per year). Same goes when it comes to your income, if you are paid fortnightly, divide this amount by two or if you are paid monthly, divide this amount by four. By forcing yourself to record these details, you will notice clearly what and where your money is really going. Being honest at first can be confronting, although please realise, you can’t claim the treasure, without slaying some old fiery dragons. This is the beginning of a refreshing financial future, with no more of those dreaded sleepless nights.

Kate: It really drives home what you are really spending. People need to get real with their money. As a lot of people are living in la la land, and I’m not talking about the la la land of positive thinking and all that. They literally put their head in the sand and they don’t really know what they are spending. This is why exercise one and two are so important to each other. It really shows you how far off, or how on the ball you really are with what you think you’re spending to what you actually are. It’s important to know where you are coming from to where you need to be going.

Shannon: There is really a big shock value for a lot of people. A lot of people don’t even really look at their credit card balance or bank statements. Some people think they might spend $400 a month going out for dinner but get a surprise when the final dollar spend is $800. This gets them thinking about monitoring spending for future months.

In all the time you have ever worked with people on home budgets has there ever been a special story or case which has stuck in your mind?
Kate: Yes, I have one about a business. This business was on the verge of going broke. They had no idea where money was going. For example, the boss had two lots of life insurance on himself; how many life insurances do you need? It wasn’t because he wanted to have two lots of life insurance on himself, he would just agree with sales people each time they tried to sell him things. He used to pay his suppliers twice a lot of the time because he had no system in place to let him know he had already paid a certain bill.

I worked with him each day for a week. And not a day went by where we didn’t find missing money or too much money being spent on this or that. This is a real lesson on how much people’s fingers are not on the pulse with money. And a lot of times these very same people sit there thinking “far out there is no money.” People like this really have no idea.

In 2008, the world was hit by the Global Financial Crisis. Did you notice a change in people’s behaviour towards money?
Kate: On a global scale there was a lot of fear which really drove the message home ‘it’s not business as usual’. In Australia, we got a little bit of support with extra money being put into our pockets from our government. So people in Australia continued to feel slightly on top of things. However in the US, the reason why it hit them a lot quicker and harder is because there would be no real support. In Australia it seemed to take a little bit longer to feel the effects.

Shannon: I felt it hard. We needed to completely restructure our business because of the work drying up in the building industry. Our company was safe, but a lot of other construction companies were not.

Kate: Your emotions are so important in your own home. So if you don’t get caught up in it; don’t watch the news. And don’t get caught in the negative side of things. You need to keep telling yourself, “You know what, I have always been supported in some way, I have got this far, I will be sure that I will be fine”. Life has a way of smoothing out the bumps if you are positive.

I have a grand suggestion that will end the globally financial crises – Just get all the people in power to go on TV, radio, in the news papers and magazines and say that it is over! Plus, state that from now onwards we are all going to be very prosperous.

Thanks a lot for your time and good luck with your book in the future.