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Money Expert - Diana Clement - Financial Planning, Career, Investing, Economy, Property - MSN NZ

Lazy habits that are costing you dearly

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You're only fleecing yourself if you do any of these 10 things below. And let's be honest, most people have fallen into these traps.

1. Paying fines on anything, be it library books or video hires
Mark the dates on your calendar or set a reminder on your mobile phone and return what you've borrowed before the due date. I also make a mental note of never clocking up motoring fines of any sort.

2. Leaving the bulk of your money in current accounts
Your current account probably pays you 1 percent or less in interest. Yet you can get more than 3 percent from your bank from an online savings account or similar. Smart customers have the bulk of their monthly salary credited into the higher interest account, and transfer across money to the current account as they need it.

3. Not paying by direct debit/automatic payment
I pay all bills by direct debit or automatic payment. That way I never miss a payment day, but I also rack up considerable discounts. For example I got a $33.49 "prompt payment" discount on my Contact Energy bill this month. I have all bills charged to my credit card, which I pay off in full every month. So each month, I build up reward dollars, which I can spend on petrol or groceries.

4. Overdrawing your current account
Some banks here in New Zealand charge honour and dishonour fees for exceeding your allowed credit limit. You'll also be charged interest. Again you need to keep a close eye on your balances before whipping out your plastic cards and spending.

5. Failing to switch your credit card
There are many reasons to switch credit cards . You need to understand your spending profile to get the right card. If like me you pay your bill on time each month (see direct debit, No 3, above) you're best off with a card that earns rewards. If you don't want rewards, then a low-fee card is best. And if you're someone who pays interest on their credit card, then get one with a low interest rate. Compare cards by fees and interest rates.

6. Watching TV every night
I've read a lot of personal finance and motivational books in my time and again and again they warn not to waste every evening watching TV. Use an hour a night to do important tasks, including keeping tabs on your personal finances.

7. Not paying attention to 0 percent interest-free deadlines
Those 0 percent interest rates on hire purchase (credit contracts) can be very tempting. But with some contracts if you fail to pay off the entire debt by the end of the 0 percent period, you get all the interest you would have paid backdated and added to the outstanding balance, says the New Zealand Federation of Family Budgeting Services. So read your paperwork well.

8. Not eating your groceries
If you eat at home and use up food before buying replacements, you'll spend quite literally thousands of dollars less in food a year.

9. Failing to file tax returns
The Inland Revenue Department charges penalties and fines if you don't file your tax returns on time and they can add up quite fast.

10. Not opening a Kiwisaver account
There's $1000 free kick-start when you open a Kiwisaver account and every dollar you pay in up to $1080 a year is matched by the government. Nowhere else do you get a 100 percent instant return on your investment.

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User comments
I’m a 23 year old living and working in Perth WA I’m from NZ, I can’t believe the NZ the government has not set a law so that everyone must have a superannuation account such as kiwi saver, On top of my wage my super is added over here I don’t care about getting old at all, but I all ready have thousands in my super account. I would much rather use the money to travel but you’re not allowed to spend it util you leave AUS for good our your super old so I’m getting set up without thinking about it. If I was in N.Z there be no way I would have started saving for my retirement at 20 years old. Does the government not wonder why every young person is leaving N.Z as soon as they can buy a ticket to Sydney? How hard can it be for them to set up a simple superannuation plan for our country’s youth? From the “Brian drain” Gen Y.
No thanks I donot trust Kiwisaver. I save using my own method with my Hubby and we sure do save and we make a vow never to touch that money unless we seriously need it. Otherwise.Our Savings will benefit our kids when we leave this earth. We are the Boss of our Savings and no one else.It is Guarantee money will always be there for me and my family. I seriously donot trust these Kiwi savers sorry.
Its evident out there that so many people are either not informed or misinformed about Kiwisaver. If we all did our own research about it and then chose ourselves whether or not to do it (instead of listening to what people think they know about it), there would be more people out there who were clear about how it all works. The information you need, to decide whether or not to do it is publicly accessible. Noone else is to blame if you chose to do it based on your research. So if you wanna do it, do it and if you dont, then dont. End of story!
that wasn't that helpful at all, really. and in regards to " can you receive your money if you move overseas?" Yeah you can from what I've read - but you have to be living aborad for minimum of a year before they give it to you...... Which sucks. That article was just a fill in on a slow news day lol
I find that buying in bulk when everyday things are on offer makes the money go further in the long run. If serial is on offer one week then I might get 3 months worth that week then the following week it might be tinned fruit, tuna, salmon or pasta or baked beans. This way you never go hungry but can still make good savings on what you do buy.
Some funds(westpac for example) have a capital protection investment which means your contributions are protected and you can choose varying degrees of risk from low to high in the other investment options. And don't forget the govt contributes to the fund and so does your employer. This makes it better than saving for yourself. If you die before 65 your family gets the money. If you permanently move oseas you can take it with you and put it into an overseas super scheme. If you havent bought your first home you can also take out your contributions and your employers contributions after a couple of years for a deposit on your first home.
...Not spending your time reading blindly obvious selft help articles that never really give you any tips, and just sound like the same advertising we get on the radio - TV.
I agree with Candy - there still has been no guarantee given that your money will be there when you retire!
Kiwi Saver is something i would never do. what happens if you die before 60? or what if you need your money before 60? can you receive your money if you move overseas? Sounds a bit dodge to me.
How can you gurantee that the money you put into Kiwisaver will be there when you go to take it out in 10, 20, 30 years?! And what's wrong with just saving that money yourself?

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