New Zealand - The Good, The Bad and The Ugly.

[patches]

Suppose you have to weigh up that approach with costs for the accounts. Banking costs quickly add up.

That being said, Nedbank has money pockets which can be added to your cheque account with no fee's. They are for saving for certain goals. Could work nicely.

Always found drawing cash helps. Swiping cards is so easy, you barely take note of item costs or how much you are actually spending. Various studies prove this, after swiping a card very few participants could tell what items cost or what the total spend was.

 

 

It is easier to do here as there are virtually no fees in doing so:

 

Yup! As Saag said, accounts here are WAY easier, and pretty much free. The annual/monthly fees get waived as long as you deposit something like $2000pm in them. So your salary pretty much waives the fee.

 

And even then, the fee is $5.

 

Plus in NZ one can have sub-accounts. The bank account numbers here are actually pretty clever.

 

eg. 12-3456-7890123-456

 

where the first 2 are the bank code

next 4 are the branch code (as far as I know)

the following 7 are your actual account number

and the final 3 (or 2 depending on who you bank with) are your sub-account number.

 

So usually the last 2/3 digits are 00 or 000 meaning it is the main account. Then as Dave said, one can create sub-accounts for all your expenses/savings like:

01 - Rent

02 - Bills

03 - Groceries

04 - Bikes

etc etc

 

It's a pretty smart system and all that one needs to supply is that long number. No bank name branch code, account type etc.

 

That said, I got my account number wrong at my first job here (wasn't used to the format and added an extra 0 in the middle bit.  I didn't get paid that month, but the payroll bounced it back. I figured out the error, and it went through a few days later.

 

One thong I must say though. NZ online banking (I can only speak for Westpac and ANZ) isn't as versatile as FNB. No PayPal linking (not that I have figured out), no share trading, no decent rewards schemes (Airpoints and Flybuys are lame compared to eBucks), etc etc.

 

But it does what it's supposed to and it's free, so what more can one ask for.

Edited August 17, 2020 by patches

[intern]

My approach to saving has always been very simple - I invest in my debt, and I make sure my debt is all in my property. If I had multiple accounts, I'd just get confused; I also think paying bits and pieces into various accounts, or even paying things like rates or holidays or other stuff over time is a case of fooling yourself (and yes man is infinite in his capacity for self-deception).

Anyway, it seems to work for me just fine, though I am not by any stretch of the imagination more than 'doing fine'. Right now though, I don't have any debt to invest in, so I do have to find something or somewhere to make money work. While being acutely aware than while it takes a Herculean effort to assemble 10c, it takes just about none to return the cash register to zero again.

[Wayne Potgieter]

A piece of completely unsolicited advise...

 

We got to NZ, realized that amongst all the upheaval and all else we needed to get our finances in order.  The missus brought a book home from one of her colleagues - Scott Pape's The Barefoot Investor.

 

Simple stuff, made the world of difference to us, we're facing Covid risks in pretty good shape because of it.

 

Basically open a set of accounts, stick the right amount into each, do with each what is supposed to be done, stop worrying.

 

https://www.barefootinvestor.com/books

 

Interestingly enough, our financial advisor who comes from a free state farming family was telling us the night before we got the book that his father told him to open an account for every single major thing that money gets spent on (including bikes) and funnel income into them accordingly.   

 

You decide how much is going into each account, and that's it.  If there is money in the account for bikes, you can spend it as you choose. 

 

I don't go that far, but did open a subset of the Barefoot accounts (Utilities/Cars/Insurance/etc) and bung a given amount in that.  Come WOF time in Jan (for both cars), there's the cash, sitting in the cars account. Come holiday time, there's the cash, sitting in the holiday ('Smile' in Barefoot terms) account.  

His weekly newsletter is also pretty entertaining - about the only one of the many that flood my inbox that I regularly open.

 

I just need to get the wife to agree to a boats account now...

This is something near to my heart. 

 

We all use specialist pieces of software to manage a companies finances (I know, its exactly what I sell for a living www.verde.co.nz) but we neglect to manage our personal finances the same way. At the end of it all, our personal finances need to be seen to be the "business" of the family.

 

I am a huge fan of POCKETSMITH. Essentially a personal financial management tool. 

 

It costs $9 a month, but it gives me the ability to create budgets, and more importantly links to my bank accounts (all of them) to import statements. I sit down for ten minutes once a week and allocate our spend to budget categories. Right down to the cent. This gives me the ability to track our spend that is out of mind but adds up quickly (Yes, I am looking at you cheeky flat white coffee's)

 

This also allows me to break down periodic spend into monthly amounts and accrue it (What you are suggesting Dave  ) and measure the spend against the accrual.

 

As a family, we dump our accruals into an interest bearing account monthly and spend out of that as and when the periodics occur all while measuring against budget. 

 

This sounds like a lot of work, but with Pocketsmith, its really only a few clicks of a mouse.

 

We have gotten to the point of introducing our children to it. So when out in the shops and they ask for a toy or videogame, we stop and first check on the pocketsmith app how we are tracking on that budget so that we make an informed choice. I realise this teaches them to think about the expenditure in the bigger scheme of things before just blindly spending money. 

 

Seeing as we are on the subject, another small tip for those with kiddos - when your child wants to buy something a little expensive with their own pocket money and they are a little short, never "lend" them the money. The trap is too easy to say "I'll give you the extra $20 you need and take it out of your next pocket money". This teaches them that its ok to borrow to buy luxuries. As hard as it is, they should be taught that borrowing is only for houses and maybe cars - everything else Cash is King.

[intern]

And now elections delayed.......

 

 

This is a good thing; with the PM's daily standups and other parties prevented from even having campaign launches (Labour conveniently got theirs in just ahead) and prevented from campaigning, it is distinctly weighted towards the incumbents. That old curmudgeon Winston Peters probably put it best when he made clear that he would tip the government over if elections weren't delayed.

 

Watch how we will have few if any fatalities from the latest infections of the heavy flu. But we'll be paying 440 million a day for the new lockdown, and have just dished out another 510 million in wage subsidies. The bottomless pit of taxpayer money just keeps giving and giving. Until, of course, you run out of other people's money.

 

As Ernest Hemingway wrote in 'The Sun Also Rises'...how did you go broke? "Two ways. Gradually, at first, and then suddenly."

[intern]

This is something near to my heart. 

 

We all use specialist pieces of software to manage a companies finances (I know, its exactly what I sell for a living www.verde.co.nz) but we neglect to manage our personal finances the same way. At the end of it all, our personal finances need to be seen to be the "business" of the family.

 

I am a huge fan of POCKETSMITH. Essentially a personal financial management tool. 

 

 

 

I do all my budgeting in my head and keep a close eye on expenses with the proviso that if you can't afford to pay cash for it (if it isn't a house) then you can't afford it.

And I apply the Dickensian model for financial affairs as expressed by Mister Micawber in 'David Copperfield' (Charles Dickens' father was jailed in a debtor's prison for much of his - Charles' - young life):

"Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."

[davetapson]

 

Yup! As Saag said, accounts here are WAY easier, and pretty much free. 

Yep, all of that.

 

My approach to saving has always been very simple 

Yeah, I thought that posting this might be like posting religion.  A bad idea.

The thing I like about BI (and maybe over Wayne's vesion) is that it's set and forget. 

If I have a system where I need to adjust anything at the end of a month, I might do it once, second time, never.  Doesn't matter how easy.  Also pretty much removes marital disputes about what's going where as it pretty much exposes all expenditure. Boats excepted, but a wife needs something to moan about or they are not happy   

As with most things, it's a matter of finding what works for you.

I have to admit, I probably wouldn't be doing this if I was single.

Edited August 17, 2020 by davetapson

[intern]

 

 

Yep, all of that.

 

Yeah, I thought that posting this might be like posting religion.  A bad idea.

 

The thing I like about BI (and maybe over Wayne's vesion) is that it's set and forget. 

 

If I have a system where I need to adjust anything at the end of a month, I might do it once, second time, never.  Doesn't matter how easy.  Also pretty much removes marital disputes about what's going where as it pretty much exposes all expenditure. Boats excepted, but a wife needs something to moan about or they are not happy   

 

As with most things, it's a matter of finding what works for you.

 

I have to admit, I probably wouldn't be doing this if I was single.

 

 

Haha, the only reason I keep it simple is because I am myself pretty simpel.

[davetapson]

Just a final comment and I'll shut up.

One of the BI things is to have two debit cards, one marked Daily Expenses, and one Splurge.

DE pays for the self explanatory, Splurge pays for splurges.  You want a flat white?  Is there cash in Splurge?  Buy it.  The nice thing about Splurge is you can... splurge.  I buy coffee pods (damn, another contentious subject) from a shop in Rosedale that is more expensive than Countdown options but is like a million times better - just comes straight out of splurge, no issues.  Friday night - hey shall we go out and eat?  How much is in Splurge? Yep, let's go. Takes away the hard-done-by feeling of being budgeted out of all fun.

[patham]

I do all my budgeting in my head and keep a close eye on expenses with the proviso that if you can't afford to pay cash for it (if it isn't a house) then you can't afford it.

And I apply the Dickensian model for financial affairs as expressed by Mister Micawber in 'David Copperfield' (Charles Dickens' father was jailed in a debtor's prison for much of his - Charles' - young life):

"Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."

 

Good philosophy,and I share it in general, but believe you can make allowances for life stages. You can buy your first car or two on HP whilst on starting salaries, but you need to claw yourself up into the cash is king model.

 

I used my credit card as a true credit card for the first six months of my working life as having to set up furniture, kitchen gear, reliable car to get me to work, presentable clothes etc. were all needed on day 1 of working. The trick is to not get accustomed to it.

 

My first little townhouse I paid cash for, (noting that I did extract some cash out my company pension fund to top it up). Tinned food suppers for the next year whilst I paid myself back..... 

 

House price inflation in both SA and Au has since stripped me of that ability to self-fund to that degree ever again...

[Wayne Potgieter]

basically, manage your debt before it manages you...

[patches]

Everything you need to know about investing explained in under 1 minute:

 

[intern]

Everything you need to know about investing explained in under 1 minute:

 

Hahaha found the only other person ever to watch Freddy Got Fingered   

[patches]

Hahaha found the only other person ever to watch Freddy Got Fingered   

 

 

I was in my 2nd last year of high school when that came out. My friends and I lived on a diet of Dorritos, Mountain Dew, metal, Southpark and MTV (when it still had music and funny series like Jackass and Tom Green). So yeah, I absolutely watched Freddie got Fingered

 

Baseketball was another classic from that era

[intern]

 

I was in my 2nd last year of high school when that came out. My friends and I lived on a diet of Dorritos, Mountain Dew, metal, Southpark and MTV (when it still had music and funny series like Jackass and Tom Green). So yeah, I absolutely watched Freddie got Fingered

 

Baseketball was another classic from that era

 

I did a lot of that sort of thing too in the 'university years' (I didn't go to uni). Along with SP and Freddy, we also had Monty Python, The History of the World Part 1, Robin Hood: Men in Tights, Natural Born Killers etc. There was also copious amounts of mountain cabbage going around with it all (and which accounted for substantial Doritos consumption)! Ah good times...

[patches]

The bad...

 

Insurance companies and their universal scum-baggery! (apologies in advance to any ethically sound insurance brokers who may be reading this).

 

I have a road legal Husqvarna enduro bike insured with a a motorcycle specific insurer (underwritten by one of the big guns of course). I went with them 4yrs ago because they had the best deal.

I have noticed that my premiums have increased threefold in the past 12 months. This is likely due to the fact that the bike's WOF and Rego have expired (as it has not been ridden in nearly 18 months).

Fair enough that the insurer's liability increases if the bike is no longer road legal, however I have 2 issues with this:

1. Surely if the bike is no longer road legal and an accident occurs on the road the insurer can refuse to support any claims, therefore an increase in premium is negated.
2. (and what bugs me the most) is that there was not 1 single imail/text/call form them to advise me of the increase in premium or why they were doing so. Had they simply informed me I would have adjusted/cancelled my cover.

So yeah, having had similar insurance experiences in SA, this has illustrated to me that the underhandedness is universal.

[intern]

The bad...

 

Insurance companies and their universal scum-baggery! (apologies in advance to any ethically sound insurance brokers who may be reading this).

 

I have a road legal Husqvarna enduro bike insured with a a motorcycle specific insurer (underwritten by one of the big guns of course). I went with them 4yrs ago because they had the best deal.

 

I have noticed that my premiums have increased threefold in the past 12 months. This is likely due to the fact that the bike's WOF and Rego have expired (as it has not been ridden in nearly 18 months).

 

Fair enough that the insurer's liability increases if the bike is no longer road legal, however I have 2 issues with this:

1. Surely if the bike is no longer road legal and an accident occurs on the road the insurer can refuse to support any claims, therefore an increase in premium is negated.
2. (and what bugs me the most) is that there was not 1 single imail/text/call form them to advise me of the increase in premium or why they were doing so. Had they simply informed me I would have adjusted/cancelled my cover.

So yeah, having had similar insurance experiences in SA, this has illustrated to me that the underhandedness is universal.

 

Slack. Go with AA Insurance, problem free (and I have had cause for claim in the past, always the best test of an insurer) and even that was smooth, fast and easy. Any changes to the premium, policy, your details etc, you get an email confirming same straight away.

Avoid Tower like the plague. Effing useless.