Most of us have not been through an event or uncertain times like this before so how do we know what to do.
Don’t panic, seek help early is the main message. The problem with a panic strategy is that everything freezes, no one spends, business owners stop hiring start firing or close up shop. This all feeds into the recession, it’s a vicious cycle that sends us hurtling to the cliffs like lemmings.
If you own a business it will be a time of strategy and survival, having funds to ride it out and lenders are poised to assist businesses where they can.
As an employee you will need extra funds if you have no sick leave, are made redundant or have a loss of income.
More now than ever planning, preparation and seeing financial advice is paramount.
Mortgage restructuring or Finance
The standard mortgage is a ‘fix it and forget’ arrangement until it is time for renewal. With uncertain times ahead now is the time to review your loan structure to ensure it gets you through long term. For some there will be no advantage to change but if you don’t ask, you don’t get! Find our mortgage calculator here.
It may be a time to look at paying off mortgage debt earlier by paying the same amount each repayment taking years off the other end and saving in overall interest, particularly if you are in stable employment.
Other Debts
Just as important as reviewing your mortgage is doing a full financial health check on your other debts.
Consolidate where you can to reduce the repayments. We are specialist is looking at all your debts and assessing the savings.
If a consolidation doesn’t fit with your set of circumstances then look at whether you have any debts close to being paid off, focus on getting those paid off to free some income.
Budget for the long term, there are various methods for this and we will be posting these for you in upcoming articles.
The goal for doing your budget, consolidating and restructuring is to increase the amount of money you have in the bank for savings or to cover living expenses.
Download our personal cash budget form here to help you plan and strategise and ultimately save you money. This is an editable PDF which you can modify digitally or print out to write on.
Minimise the luxuries
This will mean something different to everyone so before you start protesting that this doesn’t apply stop and have a think, better still write down your spending habits, review your bank statements.
We all love a treat but now is the time to look at alternatives. And yes while this feeds the previously mentioned recession cycle if everyone stops spending, it is a time to be sensible and look after your dollars. Don’t borrow from your future.
What Not To Do!
Don’t panic, make educated decisions with expert advice. If you were hoping to buy a house in the next 6-12 months this is still possible for the majority of us. Don’t rush to change your kiwisaver, ride it out and we can look to adjust your purchase price. The ups and downs of property investment and recession are just that-ups and downs and it is not a time to exit the market.
What Should I Do Today?
Remember prepare don’t panic
-Complete your budget so you have the facts
-Talk to us about your mortgage and debt
Click the button below to book in today with Vicky for your free review.
- Vicky Springintveld
Read our article about the OCR announcement here.
Book a Meeting
Vicky Springintveld
Business Development Manager
Phone: 0800 337 426
Email: [email protected]
