Water Waste of Money

A few years ago, I bought a water butt for the back garden. The idea is that I get to keep all of the rain that falls on the back half of my house roof and then use it instead of the liquid gold I’m currently getting charged for by Southern Water.

At the time I realised it would take ages to repay the cost of it, by the time I had bought the barrel, the stand, the piping and the tap; it would be something like 50 barrel-fulls before it would break-even. I was doing my bit for the environment, though; plus it’s something useful to have (at the time there wasn’t an outside tap).

The other night it was raining and I was just locking up downstairs before going to bed. Then I heard the water trickling from the supply pipe into the water butt. It sounded quite loud and that made me realise something: if it’s loud, then the water must be falling a long way from the supply (at the top of the barrel) into the current level. That can’t be right because it’s rained for the past three days and it was full before that.

So at 1am I was outside in the rain with my torch and discovered that there’s now about 3 inches in the bottom of the barrel. Hunting around I found there appears to be a split in the bottom of the water butt and there’s a steady stream trickling out of it. I think the weight of the water must have something to do with the size of the split, because the last time I looked, it wasn’t losing any more.

So that’s a waste of money and the savings have literally gone down the drain.

Water Bill

Why the hell are they called standing charges? After receiving my water bill today, I needed to sit down after seeing all the “pay us an arbitrary amount for just living there” expenses applied to my account.

My water bill has been a bit of a sore point for a while now, after my parents complained about having to pay half my monthly outgoings on the old so-called-expensive “water rates” scheme. Our bill is steep compared to theirs because of a combination of several factors:

  1. The charge per cubic metre of clean water is quite high – up at 92.30p per unit.
  2. As well as being charged for clean water, we’re also charged for disposing of the dirty water. Southern Water assume that 92.5% of the clean water you get into the house will be sent back to the drain system. This charge per volume is very high – 169.80p per cubic metre.
  3. Then there’s the “standing charges” – over the past 6 months we’ve had the following standing charges applied to our account: “Water supply” (£13.23), “Wastewater drainage” (£9.12), “Surface water drainage” (£11.03), and “Highway drainage” (£3.51). Adding on all these standing charges means £73.58 a year – an extra £6.13 on the bill every month.
  4. When we first moved into the house, we were underpaying by quite a bit. Because water bills are only issued every 6 months, we had built up quite a large debit on the account before anyone noticed and our payments were adjusted to suit.

Combining the water supply and wastewater drainage charges together effectively means that for every cubic metre of water we use, we are charged an eye-watering (pardon the pun) 249.365p per cubic metre. That’s right: 1000 litres of water costs £2.50. Put it this way: every time I wish to “spend a penny” at home (about a 10 litre flush), it actually costs over twice that.

Thankfully, this blog entry has a happy ending. We’ve now caught up on our underpayments and from next month will be paying £15 per month less.

About time too.

1st Class Way to Travel

I once used Parcel2Go.com to quote for how much it would cost to send something after selling it on eBay. F***ing fortune was the answer, but that’s irrelevant. What is relevant is the fact that I gave them my e-mail address and I’m now getting spammed by them twice a week.

I was about to remove my e-mail address from their database, when yet another mailshot from them caught my eye. Bearing in mind this is a firm which finds the cheapest way to send things via courier, this is their subject line:

Parcel2Go.com Exclusive Offer – Take the whole family to Wembley for £30

Yeah – so long as you don’t mind being crammed into a small rickety box, being jostled around in transit, and passed from pillar to post by idiots who can’t read the “this way up” stickers. Actually, putting it like that, I think they must have done some contracting work for South West Trains…

How do I apply?

Money, Money, Money

The way money gets talked about in the press these days, it’s hard to maintain a reasonable perspective on exactly what you can buy and how much it costs.

For example, a transfer of a football player worth £2m would hardly raise an eyebrow these days, even in League Division One. Yet to most of us, £2m is an unimaginable amount of money. Counting that out in twenty pound notes would easily take the best part of half a day.

At the other end of the scale is yet another financial rescue package announced today of £37bn. Loads of money isn’t it? Well actually, in 2007 IBM had revenue of $98.8bn or £56.9bn at today’s exchange rate. So the UK government is actually bailing out banks with less money than IBM can turnover in a year; plus we need to keep shareholders happy.

Another thing is the perceived value of winning the national lottery. Many people assume that if their six numbers came up, they could retire and live on the interest. Actually, you probably couldn’t.

Say you won £2m on the lottery: great. Pay off the mortgage, loans, and credit cards: £150,000. Throw a big party, go on a celebratory round-the-world holiday, and buy a fancy new car: another £150,000. Significantly more if you’re into some exotic Ferrari etc. Give a bit to friends and family: that’s anywhere from £200,000 upwards. So you’re left with £1.5m in the bank and you’re still in your original house. So you want to move to somewhere bigger / quieter / more relaxing / requiring less work. You’ve now whet your appetite with your taste of the good life, so you’re talking about £300k+.

So now we’re all content with our nice house, nice car, happy family and you’ve quit your job. Plus you’ve got around a million in the bank – sorted aren’t you? Well no, actually. To “live off the interest”, you need to invest that cash into a safe place. And “safe place” automatically means “low yield”. You can’t go round gambling with it into stocks and shares (or even property these days), because this is now your livelihood. If the stock or property markets take a tumble, then you’re struggling to pay the bills. You also need to get the money on a regular basis, so you can’t have it tied up in 5- or 10-year trust funds. So you’re now looking at the high-end of regular savings accounts. Unfortunately, things aren’t that easy either.

Inflation currently stands at around 5%, so if your money is earning 5% interest in a bank account, then it’s quite simply “standing still” in real terms. What cost £100 last year now costs £105, so you’re not any better off. Obviously as a long-term plan you need to be getting an interest rate better than inflation. Say you find a good couple of investments and manage to sort out something for 8%. That means for every million you have in the bank, you get £80,000 back in interest. But of course, you’re taxed on that (at higher-rate tax band), so there’s another £22,500 gone. And of course, you can’t touch the bit that’s put aside to cover inflation, so you’ve just effectively lost another £50,000. £80,000 in interest and you’re only allowed to have your hands on £7,500 of that per year.

Now that doesn’t sound bad – after all you don’t have any mortgage or other debts to pay off, do you? But you’ve moved to the bigger house which costs a fortune to heat and light. Plus, you’re now used to fine dining and the expensive holidays which you don’t really want to cut out. You’re no longer employed, either, so you need some hobby to fill-in the time between now and death. £7,500 is now significantly less than you thought you were going to get as a pension when you planned for retirement before all this happened. That “millionaire’s lifestyle” of you and beloved flying business class to New York for a weekend costs over £7,000 (excluding accommodation) and is now looking very distant indeed.

business_class

Money: stay happy without it, because if you do happen upon some, it’s never as much as you think. Unless of course you’re a bank, in which case gamble it anyway, because someone will come along and rescue you if you ever get into trouble.