New column: Financial Q&A with Rifka Lebowitz Published in “The Community Bulletin” October 2013
Syncing Your Finances with the Yearly Cycle
Q. We made Aliya 7.5 years ago. My husband got a job here and, from speaking to friends, I understand my husband’s job is well-paid. I work on an hourly basis for a U.S. company, as many hours as I can, including night hours here. We earn far more than the average Israeli, yet between our two incomes, we found the extra expenses around the Chagim, including keeping the kids occupied over the long break and Chol Hamoed, to be very expensive and a challenge to afford. It’s stressful! What do you suggest?
A. Between entertaining the kids, buying extra food, hosting guests and taking Chol HaMoed trips, the fall Chagim can be very expensive. All this comes right after summer camp and family vacation expenses on top of all the back-to-school expenses. It really adds up!
The good news is that these expenses are neither sudden nor surprising. Just as the Jewish year has a cycle, so your annual finances need to have a cycle. From Succot until Pesach, there are six quieter months during which you can both earn more and spend less. With children in school and no month-long holidays, you’ll have fewer interruptions and you’ll probably find you can put in more hours. During these quieter months, your spending should also be lower, allowing you to save more. Doing so will give you a cash reserve for the months when expenses are higher.
You already know that next year, you’ll have the same extra expenses. If you plan now, you’ll be able to cover the extra costs with less stress. We are now “after the Chagim”. Now is your chance to catch up. Spend these next six months getting on track, developing a budget (no matter how large your income) and learning to live financially smarter. Please be in touch if you’d like help developing a plan that works for your family.
Q. I heard I can get tax back on charitable donations in Israel? How do I go about doing this?
A. If you are employed, you can give the receipts for donations to your employer. They will present them for you, and you will automatically pay less income tax. Most Israeli employers will do this for you, but it has to be done during the course of the year (receipts for 2013 must be given in by December 2013). Tip: don’t forget to add in life insurance which is also tax deductible. If you are self employed, give receipts to your accountant, and s/he will do it when s/he presents your annual report to the tax authorities. Read here for more information on Tax returns in Israel.
Q. Can I do this myself?
A. Yes, if your finances are fairly straightforward. Take the train to Ramle (Mas Hacnasa is a 7 minute walk from the train station)or your closest Mas Hachnasa office. There are people who can help you fill out the form.
Q. The bank is so different to what I am used to. I really don’t know where to start…..what resources are available to help me?
A. The banking system here is totally different, and it can be overwhelming. But, you have come to the right place – look at our tips for banking in Israel page.You can also join one of my banking seminars; These seminars are available via Nefesh BNefesh, AACI or run privately. These seminars are offered in different locations throughout Israel. If there is no seminar planned near you in the near future, you could host a seminar.
Q. We barely get by on our Israeli salary, let alone thinking about saving. Should I be worried that I don’t have any savings in place?
A. Israeli salaries leave a lot to be desired, which is why many Israelis live in overdraft, but this doesn’t make savings any less important, or living in overdraft a necessity . Prioritizing for savings is as important as paying a bill – there is a principle “pay yourself first”…..whatever you are earning, put something aside for savings, don’t wait until the end of the month when there may be nothing left.
Q. We just made Aliya, what personal finance tools are available in Israel?
A. First of all, Mazal Tov on your Aliya. As for personal finance tools I would recommend first getting familiar with the Israeli financial products, banking and investment system and then assessing how to set up your finances in Israel. Currently two of the banks offer a free budget planner on its web site this is a useful tool for tracking your spending. You can read more on this site, Israeli newspapers, join a seminar, or book a private consultation to learn more and asses your individual financial needs.
Q. How can I see what public records of home sales prices in Israel?
A. These are available, check https://www.misim.gov.il/svinfonadlan2010/
or on www.yad2.co.il