Young Money: Dad was right

Mariah Clark is a 17 year old high school student from Palmerston North. She wrote this post as part of a task for the Massey University Business Boot Camp – BNZ was a Gold sponsor of the Boot Camp and hosted students at BNZ sites across Auckland to meet staff and gain insights into how the bank operates. Continue reading…

Five ways new parents can sort their finances

Most parents will tell you that you’re never really prepared for the massive life changes that go hand in hand with having a first baby, so the last thing you want to be worrying about is your finances. Of course, other than sleep, finances are one of the first things to take a hit as new parents find themselves learning to cope with reduced income and increased costs. This is the time to put a financial safety net in place. Even though sooner is better, it’s never too late to start — so here are five ways to get your finances ready for the arrival of your first baby. Continue reading…

Young Money: The art of managing money – tales from a teen

One of a series of blogs from real people sharing real experiences, observations and advice about being good with money. 

Michelle Feng is a 17 year old high school student from Auckland’s North Shore. She wrote this post as part of a task for the Massey University Business Boot Camp– BNZ was a Gold sponsor of the Boot Camp and hosted students at BNZ sites across Auckland to meet staff and gain insights into how the bank operates.

The first time I went grocery shopping by myself I was so excited. It was a mission, and I was alone. I was sure of the product I wanted to buy, and I even planned out my route to get there. However, when I arrived at the supermarket, my planning and good intentions went right out the window.

I became distracted and overwhelmed. You know the feeling when you just cannot stop your eyes scanning the shelves? The shiny, plastic-packaged products shouting ‘Me! Me! Me! Buy me! I am totes way better than the other brands!’ It can be so hard to look away from these beautiful products, sitting nicely on the shelves waiting for you to take them home. How are you supposed to know which brand is the best?

The reality is, of course, that there is not much difference between products. On that ill-fated shopping trip I, a naive and inexperienced shopper, became side-tracked and eventually bought everything that struck my fancy. Upon leaving the supermarket I realised I had left without buying the very product I went to the store for in the first place.

And yes, this is a true story.

Putting aside the trouble I got into at home, I learnt some important lessons about being good with money. Determining which desires are needs and which are wants is often the last thing on the mind of a money-wielding teen, and the importance staying focused can have on positive money management.

The big challenge then is: how can we be good with money in the face of distraction and confusion around needs and wants? How can we deal with all the temptation around us and get the most value out of the limited resources we have?

Let’s look at people who are good at dealing with money. It seems clear that older people are better than their younger counterparts in terms of managing money. They may have a better understanding about what is really important, have their priorities straight, have developed self-control and made wiser financial decisions. Younger people, on the other hand, may be much more frivolous and lack the same level of discernment about what they actually need.

Big assumptions and grand generalisations, I know. But run with me on this one.

So it seems that, in order to be good with our money, we first need to identify what our needs are, and what our wants are. As I slowly move out of the sheltered world of home and school into the ‘real’ adult world, I begin to realise that managing money is more than just doing the maths and calculating how much we have earned. Instead what really matters is how we can use money effectively within the constraints we have.

The popular saying “money is neither good or bad; it is what you do with it” applies to managing money. In essence, we are responsible for what we do with what we have.

A common mistake parents make in today’s society is not trusting their kids with money from an early age. What they don’t realise is that the sooner they allow their kids to get in touch with money, the sooner they’ll know how to manage it effectively. They need to learn to control their wants in order to meet their needs.

The fact is that resources are limited and our wants are unlimited. Therefore, the art of managing money is shown through our ability to control our wants and desires in order to satisfy our needs, not the other way round.

If you are studying or training and want to know how BNZ can help you manage your money, read more about our tertiary benefits for students and apprentices.

When the hammer falls: My journey to homeownership

BNZ Community member @CatherineV bought her first home at auction and reflects on the process, the properties, and the panic before the final hammer fell.

My husband and I are both savers, so when we got married in 2014 we were both in a pretty good situation with our savings. Both of us have put aside a little bit from each of our paychecks since we started working just over a decade ago, which has paid for all sorts of stuff over the years. Once we decided to test the waters of the property market it meant we had our deposit ready to go.

Price ranges and properties

Getting started was all about the detail. We had to speak to the bank to get an idea of what we could afford and we got some really good advice from them and fromBNZ Community blog posts on how to decide how much to borrow.

After a short time looking in Auckland and not finding what we wanted in our price range we had to consider other options. This meant considering different styles of properties like apartments rather than houses and extending our search geographically. It seems to be a common pain point for young buyers. After a while you tend to get rather tired of people suggesting you look further out when you’re already doing so and it’s a pretty personal decision as to where you live.

Open homes and spreadsheets and building reports, oh my!

It got quite intense. I’m now super familiar with the Trade Me Property app and could probably scan for new properties in my sleep. Our weekends consisted of going to 6+ open homes on a Saturday then back to the ones we liked on a Sunday. We’d often take Mum and/or Dad to get a second opinion. The whole process is time consuming and emotionally draining. I’d like somewhere and my husband wouldn’t.

When we got back from open homes we’d do a summary of them all and grade the ones we both liked. We had a spreadsheet where we would mark components of the property out of 10 and give the place an overall score. We’d mark things like location, size, street noise, kitchen and other benefits. It was really useful to geta bit more of an objective view, and is a great tip from this blog on what to look out for at open homes.

Finding ‘The One’

When we found a place we both liked it was time to get a building report. This was where it got painful. We were looking at apartments so had to be really careful. Not once but twice I had my heart set on a place only to get a building report and discover it was leaky. Depending on your builder and whether you get a written or verbal report, you’re looking at $300-600 each time. It’s a cost but one that we had to absorb. It’s nothing compared to the potential cost of buying a leaky property that would require a major investment on top of our purchase price.

Before going to an auction we needed to go to the bank to get pre-approval. When you bid it’s unconditional so you need to have all your ducks in a row. This blog gives a rundown of what you need to think about beforehand.

The big day

Auction day was absolutely terrifying. I’ve never been so scared in my entire life. From the minute I woke up until the day after the auction I was in a state of panic. My husband actually suggested I don’t go into the auction room as I looked so petrified but I made it in the end.

One of the bits of advice we were given was to have a pinch price, a buy price and a top price. I’d suggest also having a ‘top top’ price for the day. Including these prices on the spreadsheet helps. We ended up winning, on our ‘top top’ price. After that you’re taken away to arrange to pay the 10% deposit and sign all the paperwork.

Then it’s all over. After the hammer falls on the biggest financial investment many of us will ever make, there can be a sense of panic.  I felt it but there was also celebration at feeling like we’d reached a milestone. Corks may have popped. Good luck to any of you on this journey at the moment.

Young Money: Fortune favours the thrifty

One of a series of blogs from real people sharing real experiences, observations and advice about being good with money.

Amelia Petrovich is a part time waitress and full time uni student at AUT in Auckland. Originally from Wellington, the 20 year old moved to Auckland to complete a Bachelor of Communications degree and is currently in her second year of study. Continue reading…

Young Money: Own it, don’t loan it

One of a series of blogs from real people sharing real experiences, observations and advice about being good with money. 

Simon Palfrey is a 22-year-old student at Massey University in Auckland. He is studying towards a degree in Communications majoring in Public Relations and Journalism. Simon currently works in the health and safety sector and enjoys sport and spending time with family and friends in his spare time. Continue reading…

Young Money: Big cities on small budgets

One of a series of blogs from real people sharing real experiences, observations and advice about being good with money. 

Zoe Russell is a 22-year-old student at Victoria University of Wellington. She is studying towards a double degree in Law, Public Policy, and International Relations. Zoe also enjoys science writing and activism. Continue reading…

Young Money: Haunted by the ghost of mismanaged finances past

One of a series of blogs from real people sharing real experiences, observations and advice about being good with money. 

Matiu Workman is a 26-year-old journalism graduate who has covered sport for three years. He’s also spent time as a general reporter in the Cook Islands. He currently works in the online news media industry. Continue reading…

Sustainable saving: Setting goals you’ll stick to

Savings goals that are set in a fit of optimism can often be forgotten or abandoned weeks or months down the track. Luckily, there are a few simple techniques you can use to set goals and stick to them, ultimately creating long-lasting savings habits. The key is to acknowledge the life cycle of a goal, and follow it through – understand where you’re at now, decide what you want to achieve, create a strategy, make it easy on yourself/remove barriers, and review regularly. Continue reading…

7 money saving tips to help you worry less this Christmas

The holiday season is almost here. Christmas decorations are going up, retailers are getting ready for the ringing of tills and carols are starting to be piped through the malls. This time of year is usually associated with celebration and anticipation for the summer holidays but it can also be a tough time for people with expectations creating stress and strain, particularly on your wallet. Continue reading…