Stretching
your dollars.
0508 BUDGETLINE 0508 283 438
www.familybudgeting.org.nz
When your income is less than your expenses,
it is time to look at your alternatives. Simply put, in
order to balance your budget you have to:
1.
Increase your income
2.
Reduce your spending
Here are some tips to help you.
USE WHAT YOU’VE GOT
Time.................................................................................................................................. page 3
Time and space......................................................................................................... page 3
Existing skills................................................................................................................ page 3
Experience.................................................................................................................... page 3
Existing assets............................................................................................................. page 3
INCREASE YOUR INCOME
Inland Revenue packages................................................................................... page 4
Work and Income entitlements...................................................................... page 4
SPEND LESS
Housing costs............................................................................................................. page 8
Telephone costs........................................................................................................ page 8
Electricity and gas.................................................................................................... page 9
Bank fees ....................................................................................................................... page 9
Home loans............................................................................................................... page 10
Food / housekeeping......................................................................................... page 10
Vehicle costs............................................................................................................. page 11
Planning for Christmas....................................................................................... page 11
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Use what you’ve got
TIME
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Take some time to shop around for the best price.
Use your spare time to take on a second job.
Spend a few minutes a day tending your vegetable garden.
Time spent creating games and activities for your family can save you paying
for entertainment.
TIME AND SPACE
• If you have a suitable house and skills, you could be a child minder or part of
a baby minding group.
• If you have a spare room, you could take in a paying boarder or overseas student.
EXISTING SKILLS
• Rather than paying cash for services you need, see if you can offer your skills
or labour instead.
• Investigate community co-ops such as community gardens, carpools, etc.
• Talk with retailers and creditors, to see if you can negotiate reduced prices or
a repayment holiday.
EXPERIENCE
• Think before you buy on a whim – avoid wasteful purchases.
• If you need something, keep an eye on prices and specials. Then you will know
the best time to buy.
EXISTING ASSETS
• Talk to your family / whanau. They may be able to help you.
• Sell any items that you don’t need or want.
• Investigate consolidating your debt into one lower interest loan.
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Increase your income
USE INLAND REVENUE PACKAGES
Working for Families is a package delivered by Inland Revenue and Work and Income,
designed to help make it easier for you to work and raise a family. It pays extra money to
many thousands of New Zealand families. Greater financial support is available for:
• Almost all families with children, earning under $70,000 a year.
• Many families with children, earning up to $100,000 a year.
• Some larger families earning more.
Working for Families Tax Credits are made up of four types of payments:
• Family tax credit
• In-work tax credit
• Minimum family tax credit
• Parental tax credit
You may qualify for one or more, depending on your personal situation.
For more information, go to www.workingforfamilies.govt.nz or call 0800 227 773.
WORK AND INCOME ENTITLEMENTS
Work and Income provides a single point of contact for people needing job search support,
financial assistance and in-work support. Below is more information about the financial
support you and your family may be able to get.
Work and Income can provide you with financial support if:
• you are unable to work or you are struggling to support yourself and your family,
• you need help with ongoing living costs like housing and disability expenses, • you have an immediate, essential or emergency need for an item or service that
you cannot afford to pay for right now.
This information is only a quick guide, and there may be other conditions. If you would like
to know more, please go to www.workandincome.govt.nz or call 0800 559 009.
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Accommodation Supplement
This payment can help with your rent, board or the cost of owning a home. You may be able
to get it if your income and cash assets are lower than a certain amount. You are not entitled
to this payment if you rent a property owned or managed by Housing New Zealand.
Advance payment of benefit
If there’s something you really need but can’t afford to pay for right now (like appliances,
rent or school uniforms) you may be able to get some of your benefit paid ahead of time. You need to pay it back and there are other conditions.
Child Disability Allowance
You may be able to get this allowance if you are caring for a disabled child. It doesn’t
depend on your income or costs, but the child must be under 18 years old, have a physical
or mental disability and need constant care and attention. A Disability Allowance may
also be available.
Childcare Subsidy
If you have pre-school children who go to an early childhood education service, the subsidy
can help with your childcare costs.
Community Services Card
This card gives you and your family discounts on doctors visits and prescriptions. You’ll
get one if you get a benefit – or you can apply for one if you don’t get a benefit but are
a superannuitant or on a low to middle income.
Course Participation Assistance
If you are attending an employment or training programme with us we may be able to help
with your course fees, caring and transport costs.
Disability Allowance
This allowance can help towards the extra costs you, your child or partner have because
of a disability. It can help pay for things like regular visits to the doctor or hospital,
medicines, extra heating, special food or travel.
Home Help
This allowance can help if you’ve had a multiple birth, have a domestic emergency or need
domestic support with things like housework, cooking or childcare.
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Living Alone Payment
If you live alone and receive New Zealand Superannuation or Veteran’s Pension, you may
qualify for the Living Alone Payment as well. You can get the payment from the date you
started living alone or the date we receive your application, whichever is later.
If your partner has died recently and you apply within 28 days, the payment can be started
from the day after your partner died.
New Employment Transition Grant
You may be able to get this grant if you have been working for 6 months or less and you
miss out on income because you, your partner or child are sick, or you have problems with
childcare arrangements. You need to have a dependent child or children.
OSCAR Subsidy
If you have school-age children and you are working, training or taking part in a work-related
activity, the OSCAR Subsidy can help pay for your children’s care before or after school and in
the holidays.
Recoverable Assistance Payment
This is for people not receiving a main benefit. If you need something but can’t afford to
pay for it right now (like appliances, rent or school uniforms) you may be able to get this
assistance. You need to pay it back and there are other conditions.
Skills Investment Subsidy
Work and Income may be able to pay a subsidy to an employer for wages and/or pay
for training so you can get the skills you need to do the job. This can be paid while you
are working.
Special Needs Grant
This payment can help with urgent things that you really don’t have any other way to pay
for, like food, bedding and emergency dental or medical care. You won’t usually have to
pay this grant back. There are other conditions so talk with your case manager if you’d like
to know more.
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SuperGold Card
The SuperGold Card will entitle you to discounts from participating businesses and give
easy access to concessions on government and local authority services. This card will
be sent to you automatically soon after your New Zealand Superannuation/Veteran’s
Pension is granted. If you have a non-qualifying partner included in your New Zealand
Superannuation, they will also get a SuperGold Card.
Taskforce Green
Taskforce Green is a subsidy that you to participate in project-based work where you can
develop work habits and general on-the-job skills.
Temporary Additional Support
If you’re in hardship and urgently need help with your essential living costs and you have no
other way of meeting these costs, please talk to us.
You will not get Temporary Additional Support if you currently receive a Special Benefit. Your
Special Benefit will continue until you no longer need it.
Training Incentive Allowance
This allowance is for people on Domestic Purposes, Widow’s or Invalid’s benefits, or
Emergency Maintenance Allowance, who are training to improve their work skills.
Transition to Work
This grant can help with the costs of searching for or starting work – like clothes for work or
travel costs. It may also help meet your living costs until you get your first pay.
Work Experience
Work Experience gives you the opportunity to gain up-to-date work experience to explore
whether a job or career would be suitable, and to develop informal contacts.
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Reduce your spending
SPEND LESS ON FOOD / HOUSEKEEPING
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Plan your weekly menu.
Know how much can be spent before shopping.
Write a shopping list - and stick to it! Ignore nagging children, or leave them at home.
Take a calculator, or use self-scanners.
Use the cheapest supermarket in the area. Watch out for the specials and be aware that
local convenience stores and service stations charge extra for the convenience.
Don’t shop when hungry.
By bargains in bulk, if possible. Prepare and freeze fresh produce items.
Give budget products a try. Expensive brands are not always best.
Compare volumes against cost. Look for best value by checking the price per
100 grams or litre.
Buy when products are in season.
Select a multi-purpose cleaner. Don’t buy a range of separate cleaning products
when one multi-purpose cleaner will do the same job.
Buy ingredients and bake. Some produce nearing expiry dates may be offered at
discounted products, but is still perfectly good if used straight away, or prepared
and stored.
Feed the kids after school. This will stop them scavenging in the cupboards and
upsetting your planned menus.
SPEND LESS ON TELEPHONE COSTS
• Install a toll bar to prevent toll calls and cellphone calls.
• Set pin numbers, so that only those with the number can make toll calls and
cellphone calls.
• If you must call outside the area, do it at off-peak times when the rates are cheaper.
• Use prepaid cellphones and avoid expensive long-term plans. That way you will only
spend what you can afford.
• If you live with others, keep a record of each toll call and who made it. When the phone
bill comes in, you can see which ones belong to each person, and you only pay for the
calls you made.
• Look for less expensive deals from other providers. This could be just for the phone
or could be package deals including the internet.
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SPEND LESS ON ELECTRICITY AND GAS
• Look around for the best deal in your area. Get all the information
before making a decision.
• Visit www.powerswitch.co.nz to easily compare prices.
• Conserve energy as much as possible. You could wrap your hot water cylinder, turn off
lights, turn off appliances at the wall, and heat only the room you are in, among other
things. Talk to your friends about how they save power.
• Talk to your power provider about pay-as-you-go meters. These work in a similar way
to prepaid cellphones, so your account doesn’t get out of control.
• Ask your power provider about easy pay options. Some offer discounts if payments
are made by automatic payments or direct debits.
SPEND LESS ON BANK FEES
• Reduce the number of transactions. For example, use eftpos to pay for your
groceries and get out extra cash for the things you need from other shops.
• Talk to your bank about a low-cost account. Many offer an account with no eftpos
transaction fees but find out all the conditions before deciding.
• Talk to your bank about whether you qualify for a special package. For example, students
and superannuitants may have qualify for a fee exemption.
• Investigate all the different types of accounts to find the best fit for you.
• Use one bank to take advantage of free transfers between your accounts.
• Close any accounts you don’t use. Inactive accounts often incur additional fees.
• Use your own bank’s ATMs. There is often a fee for using other bank’s ATMs to
withdraw cash.
• Consider not having a cheque book. Cheque books usually have a cost. Online banking
might meet all your needs and is more cost effective.
• If you have a savings account, make sure you are getting the best rate of interest possible
• Check your bank statements. Once a month reconcile your bank statement with your
own records, and keep your statement for future reference.
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SPEND LESS ON HOME LOANS
• Borrow as little as possible. You will have to repay less and will be charged
less interest. Rather than borrowing more, consider renting out a room to
increase your income.
• Shop around. Interest rates do vary, and banks will sometimes offer incentives to get
your business. Gather all the information before making a decision.
• Negotiate. Some lenders will reduce or waive fees to match deals advertised by
competitors. If you think you’ll be making lump sum payments make sure your
arrangement allows for this.
• Look at a mix of fixed and floating interest rates. Fixed rates are usually lower than
floating rates, but over time the floating rate may drop. Trying to alter a fixed rate may
incur a penalty. Fixed rate home loans can restrict lump sum repayments, so consider
whether that flexibility is important to you.
• Make regular instalments as large as possible. For example an extra $40 a fortnight
could save you $33,000 in interest, and 3 years of the term of the mortgage. (Assuming
a $250,000 loan at 6.50% interest over 25 years.)
• If you make monthly payments, consider halving your payments and paying fortnightly
instead – this reduces interest paid and the term of your mortgage.
• Make lump sum payments whenever possible. Put any unexpected windfall onto the
mortgage to reduce both the term and interest. Placing a lump sum on your mortgage
is similar to placing it in a savings account, but the amount saved in interest is likely to
be greater than any interest rate offered for investment.
• Maintain repayments even when interest rates fall. By keeping your instalment at the
higher level the principal is repaid faster, reducing the interest.
SPEND LESS ON HOUSING COSTS
Housing New Zealand
Tenants of Housing New Zealand Corporation properties on low incomes pay only a
percentage of their income in rent. This is instead of an Accommodation Supplement.
Tenancy Services
Tenancy Services offers free advice and information to anyone who is renting and landlords,
administers a bond system, and offers a specialised mediation service.
Rates rebates
Local authorities can provide a rebate for some properties, subject to gross income, the
amount of rates payable, and some conditions about the property.
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SPEND LESS ON VEHICLE COSTS
• Is your vehicle really necessary? When you work out the annual cost of a
car, those near a public transport system may find it cheaper to use buses,
trains and the occasional taxi. You could even hire a vehicle for holidays.
• Start a neighbourhood walking bus to get the children to school safely.
• Carpool as often as possible, and share the petrol costs.
• Maintain your vehicle to save fuel consumption. Under inflated tyres, carrying
unnecessary weight, using a roof rack, dirty air filters, and frequent braking then
accelerating all contribute to increased fuel consumption.
• Keep the vehicle registered, warranted, legally parked, and drive responsibly. Fines can
add enormous extra costs.
• Make one big trip instead of several short trips. Plan the trip so that the week’s shopping,
petrol, and other buying is done on the way, rather than special trips. Walk short
distances rather than drive.
• Shop around for your vehicle insurance.
SPEND LESS BY PLANNING FOR CHRISTMAS
• Plan ahead. Buy when prices are lowest and items are on special.
Don’t leave buying to the last minute.
• Put aside money for Christmas each pay day.
• Set a budget for gifts and stick to it. Discuss gift buying with family and friends and
decide who to give to, and agree maximum amounts. Think up economy gifts to
make or buy.
• Consider second hand gifts, and don’t feel pressured into buying gifts for every family
member and friend.
• Don’t be tempted to borrow or get into credit deals. Don’t be sucked in by
elaborate advertising.
• Be realistic about food and drinks. Traditional and expensive foods may not be as
appreciated as the simple family favourites.
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