Kathryn George/Stuff
Piggybanks: Cute, but no way to make your money grow.
With inflation at its highest rate in 32 years, many families and businesses are feeling the financial and emotional strain.
While you might not be able to control rising food prices or sharemarket volatility, you can take control of your finances.
Here are five easy steps you can take today:
Make your savings make money
Not everyone wants to invest in the sharemarket and that’s fine. Horses for courses and all that.
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But if you do like to keep your money in a traditional savings account, make sure it’s one that pays.
CHRISTEL YARDLEY /STUFF
Coromandel family of 14, the Shellings, talk about the cost of living and what measures they have in place to try and beat inflation.
You might think a savings account is a savings account, but interest rates can vary widely. As of Wednesday, ASB’s FastSaver account paid 0.4% per annum on all balances, BNZ’s RapidSave paid 1.8% and Kiwibank’s Notice Saver paid 2.85%.
While none of those rates are within cooee of current inflation (7.3%), having your money in an account earning 2.85% interest is seven times better than stashing it somewhere earning 0.4%.
Pay particular notice if your savings are modest because some accounts, including Kiwibank’s Notice Saver, don’t pay any interest until your balance hits a set amount.
(Note: Kiwibank is removing the $2000 minimum balance requirement from Notice Saver accounts on August 24. Ka pai, Kiwibank.)
Switch utility providers
If you haven’t checked out the Powerswitch website, you could be doing your wallet a serious disservice.
Backed by Consumer NZ, Powerswitch helps consumers compare power plans, switch between providers and save money.
As of July, those who used the service were finding they could save an average of $318 a year, according to Powerswitch manager Paul Fuge.
And it’s not just your power bill you could reduce by shopping around – there are savings to be made by switching insurance, mobile and broadband providers as well.
Supplied
Consumer NZ Powerswitch manager Paul Fuge says those who use the service are finding an average of $318 a year.
Websites like MoneyHub and Glimp make it easy to compare plans and actually making the switch isn’t difficult. In many cases, the company you’re switching to will do all the dealings with your soon-to-be-ex-provider.
Refresh your budget
The world’s gone topsy-turvy and just about everything is more expensive than it was a year ago.
So, if you’re still relying on last year’s weekly or monthly spending plan, it’s probably time to reassess your budget.
Start with the essentials – at their new, more painful prices – and your money goals, then look at where you might be able to reduce costs or even remove some altogether.
Shop smarter, not necessarily smaller
Remember the old Yellow Pages slogan, “Let your fingers do the walking”? No? You youthful thing, you.
The gist of it was that it was much easier to grab the phonebook and ring around a few businesses than to walk all over town looking for a certain service or the best deal.
Printed phonebooks might be on the verge of obsoletion, but letting your fingers do the walking is more important than ever. And, thanks to comparison shopping services, it’s also easier than ever.
An app like Gaspy will find the lowest priced fuel at a pump near you, while websites like Grocer.nz let you compare the cost of your weekly shop across a range of supermarkets. For bigger ticket items, check PriceSpy before you leave home or click the “Buy now” button.
jessica shapiro/Stuff
Credit card debt can put a strain on your mental wellbeing as well as your finances.
Spend a bit of time researching, and you may find you can wring more from your money than expected.
Consolidate high-interest, high-stress credit card debt
With interest rates as high as 26.99%, credit card debt can put a strain on your mental wellbeing as well as your finances.
If you have large balances on multiple credit cards, consolidating your debt on to one card with a lower interest rate could save you hundreds or even thousands of dollars a year.
Most banks offer a credit card with low or no interest for six or 12 months on the balance transferred.
Consolidating your high-interest debt with this type of card gives you a chance to pay down the principal balance faster while avoiding interest.
