Forget SWOT analysis and other nonsense. This is the tool of the future. Well, and past as well...

After spending time writing emails, sending letters and phoning to solve such trivial things like gas supply and council tax details I was quite fed up. But the day was not over as the next set back came. Pound has been weakening since I arrived to the UK and today one of the news headline was the record low rate of GBP.

This is not the first time I am facing currency fluctuations. In April I wrote about the UK situation and even earlier from Hungary.

This doesn't affect me dramitacally because I still have some money in my euro account. But I just have to hope two things. First thing is that UK does not join euro zone with this or lower exchange rate. The other thing is that the whole UK economy wont collapse before we relocate again.

Just to make things more concrete: Comparing my annual salary in euros in January 2008 and in December 2008 it shows around 12,5 % difference. Luckily, this "loss" wont realize until I actually do the exchange.

Last weekend I took a good look at the offerings of eBay for a very first time. I was searching for telephoto lenses for our Canon 450D. Because I did not know current and discontinued Canon lenses inside out, I had to do some research. Before, I was thinking about buying a brand new Canon EF 70-200 f4 L USM lens which is very good compared to its price. So, my criteria was something similar but maybe 1/3 of the price.

I came up with a list of suitable lenses and started following auctions on eBay. After some days I had a list of final prices for couple models so I decided to try my luck. Maybe I was too careful since I did not manage to win any.

So, the result has been so far somewhat bad. I know a bit more about old Canon lenses and I have spent several hours following auctions or researching. But how much is my free time worth of? Definitely more than my hourly rate at work. The gap between brand new EF 70-200 f4 L USM and second hand with unknown condition and sharpness doesn't seem to be that big anymore...

Finding a decent flat is matter of luck or good preparation. Unfortunately, there are dodgy landlords, horrible flats and difficult neighbours. I listed couple advices for UK flat hunting:

Reserve time for flat hunting. Prepare to stay in B&B for a week or two instead of rushing to sign contract for the first flat you happen to visit.

Get a clear idea how much you can pay and what you should get with that. Some areas are cheaper but there are usually reasons for that. Remember to check the council tax for the flat.

Visit several flats. Do not worry about wasting agencies' time, they get paid for that. Ask questions but be prepared to meet totally clueless agents.

Check the background of the rental agency. Ask your colleagues and check Internet forums.

Consider private landlords instead of agencies. Generally, private landlords might offer lower rent.

Get everything written. Lease contract, meter readings, inventory list and receipt of the deposit. Take photos of the flat and make sure you capture existing damages.

Ask about current gas and electricity suppliers. A flat without previous utility bills should be avoided. Opening a new supply takes a lot of time and it isn't recommend for people with weak heart.

Older flats have single glazing and carpets everywhere - even in the bathroom. This means higher gas bill during colder months. Carpets can cause problems for allergic people.

Oversold performances, problems with ticket printing, suspended telephone and counter sales. The reason for such was an epic failure with new software called Liquid Box Office from Pivotal Integration. The system failed right away in June and had to be replaced with other system. However, the ticket printing was dependent on Liquid Box Office so sales were blocked because of lack of tickets. Eventually the printing issue was solved somehow and tickets were posted on very last moment.

Naturally such problems damage image of Edinburgh Fringe and people are pretty angry about the situation. There are competing festivals and I can imagine someone missing favorite act because of software problem will think twice next year.

Too bad I don't know anybody working for Pivotal Integration. I am rather curious to know how the project was managed, whether it followed waterfall process and how communications were with the customer.

Hmm... actually the company's name sounds really familiar. Let's do a search...

Oh my, I actually applied for some Java developer position in Pivotal Integration. I sent an application email when I was looking for a job in Scotland. I never heard anything from them afterwards - until this. Lucky me not getting that job.

www.edfringe.com: Box Office FAQs

Scotsman: Good news: Fringe box office to reopen... Bad news: It’s got no tickets
Scotsman: Fringe was warned months ago of box office fiasco

The Register: Edinburgh Fringe ticketing chaos continues
The Register: Edinburgh Fringe ticket site dead as a par
The Register: Edinburgh Fringe box office system goes titsup

My parents are now on pension after long years of work and running their own company. Occasionally I have been asked how is my pension going to be because my career path involves already at this point more than one country. And I have said that I don't know for sure - I'd better check it out.

In each country some of my salary has been deducted for compulsory pension payments. However, I am skeptical how successfully those institutions manage that money and whether I am able to contact them when it is time for a pension. My solution for this has been to build my own pension funds somehow.

This has some drawbacks. In many countries payments or investments to pension funds are free from income tax. My own deposits to high interest bank accounts or similar are subject to both income tax and capital income tax in the worst case. Investing to stocks is more risky and would require some studies. At the moment I know just a little bit of Finnish stock market but I have no clue e.g. UK situation.

In every country there are several private pension funds but I haven't found truly international and trustworthy pension fund. I guess national legislations create way too many hurdles for such. So called offshore investment could be an option. I was contacted by such in Budapest but their sales pitch was pretty suspicious sounding so haven't given too many thoughts for that option.

Maybe the best plan would be to gather reasonable amount in couple different currencies and relocate then to some reasonable cheap country with pleasant climate and good health care to spend pension days.

I have been following GBP-EUR exchange rate for a while and things do not look good for a person who receives his income in GBP. Just half a year ago the rate was 0.7 but now it is only 0.8. And it seems it keeps closing euro because economical downturn is just starting.

But because I am not about to buy brand new Mercedes this affects me only in two ways. One is my visits to Finland as prices are higher there for me. Another is grocery shopping in Edinburgh because price of imported cheese will go up as well among other articles.

After my previous experiments with the forex trade I am a bit reluctant to try that again. Maybe I should get a remote work from euro area as an extra...

Article in Telegraph:Sterling weakens further creating both winners and losers in UK

Previously I have been complaining about Hungarian tax system. But I have forgotten to mention one pretty interesting feature. It is one percent - 1%.

The idea of this 1% is that you can choose where one percent of taxable income goes. It can be NGO, for example children hospital, animal shelter or something similar. I am do not know exact rules and it is voluntary to choose receiver. In case you do not pick any organization then government decides where it should go. At least I have been told so.

The side effect is that organizations are competing fiercely with each other to get this one percent. This can be seen in TV and street advertising, flyers and so on. Naturally 3F principle applies here as well as member of such organizations are approaching friends, family and fools. I can imagine that some organizations take big risks with their campaigns in order to secure enough funding for next term.

Despite all the side effects I find this good. I can imagine that some people would be happy to choose that 1% go to local healthcare or police as they would know that it wont be used to something totally different. And maybe it would put some pressure on certain organizations to do their job well.

I had to exchange bunch of USD to HUF. The time is not really good for such transaction but it could not wait too much longer as USD seems to get weaker and weaker. I knew that there are places where the rate is really bad (airport, train stations) and then places where it is just bad (Váci utca, tourist areas). Because I had time during the weekend I took a walk and checked numerous places.

In the shopping malls there were exchange booths but the rate was 166-168. Then I took a 4/6 tram and I took a closer look whenever I saw a exchange office. This way I spotted a small place with rate of 172. First I checked from the guy in the booth the actual amount I would get and then I handed over the cash. This way I saved around 4000 HUF. Not much but at the same time I was able to do Xmas shopping as well.

There has been plenty of discussion lately about personal finances. Maybe it made me wonder where people get their money using habits and I started to go back in time. So, while traveling back from work today I tried to find out important factors from my past.

My parents have a big role here. They are entrepreneurs and I have been following closely ups and downs of their small business. Now they are retiring and I think they made a good choice when they decided to start it over 30 years ago. There were times when the company was highly profitable and times when it barely profited enough money for food. And everything between those extremes. From this I think I learnt to have some buffer funds and not to consume everything as the income level can be volatile.

In addition of the business knowhow I learnt how to plan my money usage. I had my weekly allowance but it was not too big. Sometimes I could get some extra by lawn mowing and similar tasks. I also learnt how nasty feeling it is to lose money by playing a slot machine, by breaking a lamp of my brother's bike or by other stupid things. Most of my income ended up in my piggy bank. Those savings in my piggy were taken regularly to the bank and I was following my progress from my account book (time before online banking). I learnt what is interest and some other basic knowledge related to money.

Eventually I gathered enough money to buy something more expensive. My parents usually funded half of the purchase if it was sensible otherwise. But this way I had to plan before hand what do I want and is it really worth of it. And it kept me away from buying sweets all the time.

While I got older I was able to get my first summer job in a garage. The job was really boring and I had to bike 10 km to get there. It lasted a little bit over one month but it was long enough to gather money for a 28.8 Kbit modem. After that summer I worked almost every year, mostly in local post office, until my university studies. Just before finishing my high school studies I experienced my first scam.

This event took place next to a gas station where a man approached me and my friend. He asked whether we were interested to check some loudspeakers. Every guy in high school was interested in hifi so we took a look. He was selling a pair of speakers which were left overs from an order. And of course he could sell those to me with nice price. Unfortunately I got greedy and I did not check things carefully enough - even though I did not believe his well practiced marketing speech. I ended up thinking that I am about to make a very good deal with those Acoustic Response 707 speakers. I think I paid something like over 200 euros for those. The real value was closer to 40 euros and the worst thing was, that there was an article about those scam speakers in next hifi magazine. That ruined my chances to sell them to some other fool and also the whole school knew about my great purchase.

During my university studies I did not want to take study loan so I tried to cope with standard government student support and summer jobs. I also tried to avoid asking anything from my parents as I wanted to be on my own as much as possible. But that changed when I moved together with my ex-girlfriend. I was not anymore only one deciding how to spent money and that caused a lot of conflicts and tensions.

Today I am working full time and I am curious about finance and economy sector. Most of the time excess money is sitting in a time deposit so I am not investing aggressively. I think over my purchases carefully and I buy everything with cash or direct debit. I am also rather skeptical when someone is offering me opportunity to get rich with some strange scheme. I think this behavior is sum of many events and contributors from my past and very likely it will remain similar.

I have seen loan advertisements everywhere in Budapest lately. Especially television advertisements annoy me. The show a man who is sad because he cannot buy a new microwave oven, car or holiday for the family. But then the loan fairy comes and gives him bunch of 20 000 Forint notes. Just call this number and you too can become rich.

Wrong. The yearly interest (THM) is mentioned in the advertisements and it is from 200% to over 400%. Almost free money, right? If you are mathematically illiterate you do not see how much such loans cost you. A loan of 100 000 HUF for three months, so in 200% case you would pay 50 000 HUF extra. Pretty insane.

I have read that in Finland these quick loans are the last action to push a person in a economical catastrophe. Sometimes they are used to cover payments of bills or other loan. They are the last possible loan to get because all other sources are used already. A person who has already plenty of problems with money can mess up his finances for good with such loan.

But some people will always find ways to end up in a trouble and without money. No matter if such loans exists or not.

As I have made clear previously I am pretty much against network marketing schemes. But passive income can be also totally legal and wont create conflicts with your friends. A very nice blog - www.jarkkolaine.com - has now third post about alternative incomes which can be regarded as passive.

The ways he lists are pretty much web related. Monetizing blog, selling merchandise, independent software development and photo stocks. But there are bunch of traditional sources for passive income. Unfortunately they need some capital to get them started. Investing in stocks, property or funds can be exciting and depending on how much risk you are ready to bear you can receive nice gains while traditional high interest bank deposit provide steady stream of extra.

This actually leads to my own experiments with foreign currency exchange. As traditional stock markets was a little bit boring to follow I decided to take a look at forex. I have been following EUR/HUF since 2005 and I have been interested in finance markets for some time. But forex is not that common in Finland. I got this conclusion when I searched Kauppalehti's (Finnish business news) discussion forum. I also got the conclusion that I should practice with a game account beforehand.

I searched a little bit to find suitable trading provider and I chose OANDA FXTrade. They have a Java based client which I have been using two days now. Success is still to come, so far I have managed to lose 10% of my initial deposit. Luckily it is just play money...

Establish a new company is demanding and even stressful task to do. However, to add some extra spice to this one could make it from abroad. Paradigm Quest is one example of such and they describe their process on their blog. So far it is still on planning stage but it looks pretty good as they are doing necessary research before actions.

I decided to play a little bit with some online tax calculators (bérkalkulátor). If you are planning to work in Hungary you might want to search for such and try it out. But beware - it will make you sad.

I calculated some numbers and I plotted them on a graph. On the first one you can see gross income (X-axis) with net income (Y-axis). The currency used is HUF. It does not look that bad if you do not pay attention to values.



But for the second one I calculated tax percent (Y-axis) for same gross incomes (X-axis) as on the previous graph. Now this makes me sad. Even though I come from Finland which has progressive taxation and plenty of social services to feed with tax money, this graph is not nice to view. As you can see, progression hits very hard and 200 000 HUF gross salary is not a reason for a celebration here.



So, what would highly educated hungarian with some language skills do? He works in a company and earns 250 000 - 350 000 HUF. After some time he gets a 10% raise on his salary. Sounds nice but actually it just covers inflation (7-8%) and also government happily slices almost half of it away. He gets pissed off because he does not see any point to progress on his career. But because he is smart and educated he does not go on the streets to burn cars and to do such nonsense. Instead of that he packs and relocates to another EU country with more sensible taxation.

The currency of Hungary is reaching its one year high but there is still some way to go. Government is planning to sell more bonds next week and most likely this will make forint again stronger but I wonder whether it will be allowed to go much further. But the competing countries like Poland, Slovakia and Czech have also their currency getting stronger so I guess Forint will follow. The situation in case of foreign product prices is still better for ordinary hungarian than it was in summer and autumn.