Things the banks don’t want
your clients to know.
Presentation to CBNZ – August 2009
Things the banks don’t want your clients to know.
Three unbreakable rules.
What the banks don’t want you to know.
Saving money at the bank.
Why your client can’t get a bank loan.
Contract truths.
Questions?
Presentation to CBNZ – August 2009
Three basic principles:
1] Avoid going into debt.
2] Pay off existing debt as quickly
as possible.
3] Set goals and save for them.
The basic principle – pay of more than the
minimum monthly amount.
If you owe $5000 on your credit card ...
With no fees and 20% interest...
And you add nothing more to the card...
If you owe $5000 on your credit card ...
With no fees and 20% interest...
And you add nothing more to the card...
$25
9 years and
1 month.
$5,458.39
in interest.
$50
$100
$125
If you owe $5000 on your credit card ...
With no fees and 20% interest...
And you add nothing more to the card...
$25
$50
9 years and
1 month.
$5,458.39
in interest.
2 years and
9 months.
$1,491.95
in interest.
$100
$125
If you owe $5000 on your credit card ...
With no fees and 20% interest...
And you add nothing more to the card...
$25
$50
$100
9 years and
1 month.
$5,458.39
in interest.
2 years and
9 months.
$1,491.95
in interest.
1 year and
3 months.
$647.49
in interest.
$125
If you owe $5000 on your credit card ...
With no fees and 20% interest...
And you add nothing more to the card...
$25
$50
$100
$125
9 years and
1 month.
$5,458.39
in interest.
2 years and
9 months.
$1,491.95
in interest.
1 year and
3 months.
$647.49
in interest.
1 year.
$511.38 in
interest.
Three basic principles:
1] Avoid going into debt.
2] Pay off existing debt as quickly
as possible.
3] Set goals and save for them.
Things the banks don’t want your clients to know.
Three unbreakable rules.
What the banks don’t want you to know.
Saving money at the bank.
Why your client can’t get a bank loan.
Contract truths.
Questions?
Presentation to CBNZ – August 2009
7 Things Your Bank Will Never Tell You
(Consumer Magazine Jan/Feb 2006, Issue 455, Page 23)
1. Your bank wants you to overspend.
7 Things Your Bank Will Never Tell You
(Consumer Magazine Jan/Feb 2006, Issue 455, Page 23)
1. Your bank wants you to overspend.
2. A bank’s review of your account is
really a sales pitch.
7 Things Your Bank Will Never Tell You
(Consumer Magazine Jan/Feb 2006, Issue 455, Page 23)
1. Your bank wants you to overspend.
2. A bank’s review of your account is really a sales pitch.
3. Banks prefer not to inform you of
saving’s rate increases.
7 Things Your Bank Will Never Tell You
(Consumer Magazine Jan/Feb 2006, Issue 455, Page 23)
1. Your bank wants you to overspend.
2. A bank’s review of your account is really a sales pitch.
3. Banks prefer not to inform you of saving’s rate increases.
4. Bouncing cheques are good for
your bank’s business so long as you
don’t do it too often.
7 Things Your Bank Will Never Tell You
(Consumer Magazine Jan/Feb 2006, Issue 455, Page 23)
1. Your bank wants you to overspend.
2. A bank’s review of your account is really a sales pitch.
3. Banks prefer not to inform you of saving’s rate increases.
4. Bouncing cheques are good for your bank’s business so long
as you don’t do it too often.
5. You can pay your entire credit card
bill off by direct debit (or can get a
debit card).
7 Things Your Bank Will Never Tell You
(Consumer Magazine Jan/Feb 2006, Issue 455, Page 23)
1. Your bank wants you to overspend.
2. A bank’s review of your account is really a sales pitch.
3. Banks prefer not to inform you of saving’s rate increases.
4. Bouncing cheques are good for your bank’s business so long
as you don’t do it too often.
5. You can pay your entire credit card bill off by direct debit (or
can get a debit card).
6. Bank advice may be self-interested.
7 Things Your Bank Will Never Tell You
(Consumer Magazine Jan/Feb 2006, Issue 455, Page 23)
1. Your bank wants you to overspend.
2. A bank’s review of your account is really a sales pitch.
3. Banks prefer not to inform you of saving’s rate increases.
4. Bouncing cheques are good for your bank’s business so long
as you don’t do it too often.
5. You can pay your entire credit card bill off by direct debit (or
can get a debit card).
6. Bank advice may be self-interested.
7. Service fees don’t necessarily
match the cost.
Things the banks don’t want your clients to know.
Three unbreakable rules.
What the banks don’t want you to know.
Saving money at the bank.
Why your client can’t get a loan.
Contract truths.
Questions?
Presentation to CBNZ – August 2009
How to Save Money at Your Bank
1. Get the right accounts make sure they match your
needs.
How to Save Money at Your Bank
1. Get the right accounts - make sure
they match your needs.
2. Avoid going to the bank – use
internet banking it’s cheaper.
How to Save Money at Your Bank
1. Get the right accounts - make sure
they match your needs.
2. Avoid going to the bank – use internet
banking it’s cheaper.
3. Don’t overdraw your accounts – it will
cost you.
How to Save Money at Your Bank
1. Get the right accounts - make sure
they match your needs.
2. Avoid going to the bank – use internet
banking it’s cheaper.
3. Don’t overdraw your accounts – it will cost you.
4. You should have a free transaction
account if you are a student, retiree or
mortgage holder.
How to Save Money at Your Bank
1. Get the right accounts - make sure
they match your needs.
2. Avoid going to the bank – use internet
banking it’s cheaper.
3. Don’t overdraw your accounts – it will cost you.
4. You should have a free transaction account if you
are a student, retiree or mortgage holder.
5. If you have a big term deposit/savings
ask how they will reward you.
How to Save Money at Your Bank
6 Don’t pay interest on your
credit card – pay it off
immediately.
How to Save Money at Your Bank
6 Don’t pay interest on your credit card –
pay it off immediately.
7. Use only your own banks ATM
machines or it will cost you.
How to Save Money at Your Bank
6 Don’t pay interest on your credit card –
pay it off immediately.
7. Use only your own banks ATM machines
or it will cost you.
8. Make sure you know how your bank
charges fees.
How to Save Money at Your Bank
6 Don’t pay interest on your credit card –
pay it off immediately.
7. Use only your own banks ATM machines
or it will cost you.
8. Make sure you know how your bank charges fees.
9. Consolidate your debts wherever
possible.
How to Save Money at Your Bank
6 Don’t pay interest on your credit card –
pay it off immediately.
7. Use only your own banks ATM machines
or it will cost you.
8. Make sure you know how your bank charges fees.
9. Consolidate your debts wherever possible.
10. Check your statements for mistakes
– banks do sometimes make them.
Things the banks don’t want your clients to know.
Three unbreakable rules.
What the banks don’t want you to know.
Saving money at the bank.
Why your client can’t get a bank loan.
Contract truths.
Questions?
Presentation to CBNZ – August 2009
Why your client can’t get a bank loan.
Bank loans are not automatic these days.
Banks are businesses and want a profit.
Your client needs to be the type of customer
the bank wants.
To be such a person you need a strong S-E-C.
Serviceability
Equity
Character
Why your client can’t get a bank loan.
Serviceability = your ability to service
debt.
Takes into account your total income:
 wages,
 salary,
 benefits and family tax credits etc.
 interest earned,
 dividends,
 rental income,
 boarder income,
 etc.
Why your client can’t get a bank loan.
Equity = your total assets less your
liabilities.
Takes into all you own and all you owe:
 Cash – savings, term deposits.
 Property – Loan to Value Ratio (LVR).
 Other assets: cars, shares, investments etc.
Why your client can’t get a bank loan.
Character = your total reputation.
Defend this with all your might:
 Credit history.
Why your client can’t get a bank loan.
Character = your total reputation.
Defend this with all your might:
 Credit history.
 Account conduct.
Why your client can’t get a bank loan.
Character = your total reputation.
Defend this with all your might:
 Credit history.
 Account conduct.
 Loan repayment history.
How to get the best out of your bank
Character = your total reputation.
Defend this with all your might:
 Credit history.
 Account conduct.
 Loan repayment history.
 Employment history.
How to get the best out of your bank
Character = your total reputation.
Defend this with all your might:
 Credit history.
 Account conduct.
 Loan repayment history.
 Employment history.
 Education.
Things the banks don’t want your clients to know.
Three unbreakable rules.
What the banks don’t want you to know.
Saving money at the bank.
Why your client can’t get a loan.
Contract truths.
Questions?
Presentation to CBNZ – August 2009
A word about contracts.
Break fees.
A contract is a contract...
...but nobody actually reads them!!
A word about contracts.
Interest free.
Interest deferred.
Nothing to pay for 6 months.
A word about contracts.
Interest free.
Usually contains a large admin. fee
and
beware if you miss a payment.
...and sometimes it’s
designed to ‘help’ you
miss a few!
A word about contracts.
Nothing to pay for
6 months.
After six months – very high interest rate
and
beware if your circumstances change.
Things the banks don’t want your clients to know.
Three unbreakable rules.
What the banks don’t want you to know.
Saving money at the bank.
Why your client can’t get a loan.
Contract truths.
Questions?
Presentation to CBNZ – August 2009
Things the banks don’t want
your clients to know.
Presentation to CBNZ – August 2009