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GE Top 10 Tips for Financial Savings this Christmas
| 2011-May-15, 7:47 PM | |
 To ensure that New Zealand consumers take control of their personal finances Greg White, Managing Director of GE Money New Zealand has compiled ten easy tips to help New Zealanders keep track of their finances this Christmas and celebrate a stress-free 2010. Getting organised 1. Create a budget and stick to it. The secret is to budget regularly and efficiently. It saves you money by giving an accurate picture of your finances and allows you to prioritise your costs so you can determine the most efficient ways to pay for them. Free, independent online tools such as www.sorted.org.nz can assist. 2. Select payment methods that suit your budget and ability to pay over time. For smaller items this may mean paying cash. However, for larger items if you don’t have the money immediately for something you need there are several options that spread your costs - such as credit cards, interest-free retail promotions, personal loans, or lay-bys. The key is to look at the ‘costs of credit’ in each and make sure they suit your needs and ability to pay. 3. Ensure you can pay for everything you need – don’t just look at the one item in isolation. This relates back to your budget and ensures you keep track of everything. For instance, if you pay cash for a $1,500 fridge but then need to put all your other monthly expenses on a credit card because you’ve no money left, it could end up costing you more in the long run. You might want to look at other options to make your money work more efficiently for you. 4. Investigate consolidating your debts if you feel you’re a bit out of control or need to simplify your money matters. One monthly repayment at one fixed interest rate is much easier to manage than multiple rates due on multiple dates. Interest-free and buy-now pay-later retail promotions Interest-free retail promotions typically offer six to 48 months of finance on interest-free terms. They have become a very popular way to purchase larger items as you spread the cost over a longer period typically paying off an amount each month – without paying any interest if you pay it all off within the interest-free period. Remember that there are two types of interest free promotions:
Credit cards Credit cards are very convenient and especially useful in emergencies. When used judiciously they can be a very effective way of paying for smaller and every-day items. 6. Choose a credit card which is right for you. Credit cards have different features to suit different lifestyles. Some have lower interest rates. Others have more flexibility of use or offer excellent loyalty programs, longer interest-free periods, or lower or no fees (check interest rates, late fees, annual fees and over-limit fees). Think about what is most important to you, based on your spending patterns and budget, and ensure your card suits. Personal loans 7. Use personal loans for larger items like cars, boats, holidays and major household items or renovations. They generally offer lower interest rates than other consumer finance solutions but repayment durations can be much longer. Personal loans can be approved in 24 hours and you can build a credit rating by making prompt and full repayments over time. Laybys 8. If you don’t need your item for several months, investigate lay-bys. Laybys are similar to interest-free promotions in that total up-front payment is not required and you make regular instalments that suit you. However, unlike interest free promotions you don’t receive the goods until you have paid them off in full. Maintaining control 9. Check all the fees and charges on your cards, accounts and promotions.
Finally, Mr White suggests, "If you do get into difficulty with your payments, or your financial circumstances change, it’s really important to talk to your credit provider so they can work out a plan with you. It’s in no-one’s interests to have any one default.” "By following these ten easy tips all New Zealanders, not just GE Money’s 450,000 local customers, can have a financially viable Christmas and 2010.” | |
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