Fair Go ran an interesting segment about a couple (Mike and Kirsten) who were having money worries, despite earning more than $100,000 between them -- the sort of household that some politicians call "rich". Trouble was, Mike and Kirsten were not rich and like many, were working hard but not getting ahead. They had a $410,000 mortgage which, at the current repayment rate, was going to take 25 years to repay.

The good news is they made a commitment to get the problem sorted and sought the advice of an expert . The results were outstanding and remarkable.

The great thing we like about the advice they received was that it was expressed in a way that was easy to understand.

According to their adviser, Hannah McQueen, most people fritter away about 15-20 per cent of their income. We agree, which is why we think it's so easy for people to transform their lives by being frugal.

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Apparently, $50,000 a year of Mike and Kirsten's money was "going walkabout", frittered away on things that weren't really necessary or needed -- so a plan was put in place to spend less and their mortgage was reorganised.

Their objective was to save $13,000 in three months. They blitzed that by saving $26,000! By putting those savings and some extra income that they were earning into the repayment of their mortgage, they cut the repayment terms from 25 years to six! Image that -- being debt free 19 years earlier by taking control of your money!

There were spending $500 a week on food, but that was cut back to $200 by planning meals and only buying what they needed (in other words, suppressing those impulse buying urges that the supermarkets are tempting shoppers with). Mike now takes a cut lunch to work, which saves him between $10 and $15 a day. They also upped their income via Mike increasing his overtime hours and Kirsten doing some work as a teacher's aid.

Hannah made the point that a plan needs to be effortless, otherwise you won't stick at it. We have a few additional pointers of our own:

There needs to be a compelling target or reason to save. What better reason than becoming mortgage-free and what better way to measure it than by knowing the month and year you are going to become debt free!

It needs to be a family effort. Having a common goal, like repaying the mortgage, is a team effort and everyone in the household should be part of the winning team -- it brings families closer.

Kirsten says that it doesn't feel like they're living any differently -- there are no huge sacrifices being made.

People who live off the smell of an oily rag often say that. There's no sacrifice in frugality, only benefits: when your money is under control, life is in control, and that means less worry, stress and arguments at home.

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Well done, Fair Go. To see the segment online, go to the TVNZ website and look for Fair Go's "enable us" clip on April 15. It's well worth a look. The show asked viewers to send in their tips for saving -- here's a tip: Visit oilyrag.co.nz!

As it happens the site is undergoing an oily rag reconstruction. Doing it off the smell of an oily rag means we are not spending money on experts -- we are doing it ourselves and learning as we go!

So ... the site will be a bit wonky and forms a bit cranky, bear with us and send your tips via email (tips@oilyrag.co.nz) rather than the website until we get things in order. Thank you for your questions and tips -- keep them coming!

Send your ideas and join the mailing list by emailing-- tips@oilyrag.co.nz, or by writing to us at Living Off the Smell of an Oily Rag, PO Box 984, Whangarei.

* Frank and Muriel Newman are the authors of Living Off the Smell of an Oily Rag in NZ. Read our wealth of tips at www.oilyrag.co.nz