Taking control of your finances and household expenditure can be empowering – even though you can’t directly control interest rates or inflation. To effectively manage your financial well-being, it’s important to have a clear understanding of your total income and actual spending, rather than relying on estimations.
Creating a solid financial plan starts with a few initial steps:
- Determine your monthly income: Calculate the actual amount you earn each month from all sources.
- Identify your monthly fixed expenses: Including mortgage payments, insurance premiums, rates, power bills, and other essential costs.
- Assess your monthly discretionary expenses: Take a closer look at what you’re spending on coffee, shopping, entertainment, and other non-essential items.
When it comes to essential expenses such as utilities, groceries, and petrol, shop around and ensure you’re getting the best value for your money. While your current service providers may be convenient, they might not offer the best deals.
Consider additional tips:
- Consolidate your debt from multiple sources (if appropriate), especially high-interest short-term loans or credit cards. Consolidation can help save money on fees and interest and simplify financial management.
- Budget based on your pay frequency – setting a weekly spending budget, enables you to track the amount you have left after paying for essential expenses.
- Opt for buying second-hand items whenever possible.
- Try online grocery shopping with in-store pickup. This allows you to stick to a budget by reviewing what you already have at home while avoiding unnecessary temptations and additional delivery fees.
- Shop the specials (or home brands) and check out the quick and easy recipe ideas in the supermarket or online.
- Grow your own veggies (if you have room).
Many of our clients are exploring opportunities to generate additional income. Some ideas shared with us are side hustles, freelancing or side projects – leveraging your skills and expertise. Even a small amount of additional income can help support your financial goals.
Building financial well-being sometimes requires a helping hand. Options available for those reviewing their home loan – we recommend working with a qualified financial adviser to understand any long-term impacts.
Your NZHL Mortgage Mentor is here to help. We support Kiwis everyday with their financial goals – big or small.
Please note –This blog is intended to be general in nature and should not replace personalised financial advice by your mortgage adviser.
