Not everyone is lucky enough to have trusted or knowledgeable friends and family members to talk to about money and personal finance with. However, knowledge about budgeting, saving, investing and building wealth can have lifelong benefits to you and your family. So, how good are you with your money? Do you actively manage your finances, or hope you have enough to make ends meet each month? Are you a saver or a spender? Have you thought about short-term and long-term financial goals? Do you have any investments? Have you started contributing to KiwiSaver?
If some of these questions have made you feel a little uncomfortable, you’re not alone. And there are plenty of free resources to help you along this journey too.
What is Money Week?
Money Week is an annual public awareness and engagement campaign each August to help people answer the simple and not so simple questions we all have about managing our finances. Money Week is coordinated by Te Ara Ahunga Ora, Sorted and the New Zealand financial capability community.
The purpose of the week-long event is to demystify money, help New Zealanders understand money and improve their overall financial wellbeing. That means saving money, reducing debt and investing for the future. Money Week also looks at tackling common negative behaviours around money: procrastination (holding off on making important financial decisions) and impulsivity (Buy Now Pay Later services and pulling out the credit card when you may not be able to afford to).
Key insights from Sorted Money Week 2021
We reviewed last year’s Money Week report ahead of Money Week 2022.
- ‘1 in 4 Kiwis lack confidence in managing money’ – this alarming statistic from last year’s Money Week relates to New Zealanders lacking confidence to manage their money, plan for their future or make decisions about financial products or services.
- Of the Money Week questions that were submitted, key themes included: Investing, KiwiSaver, Retirement Planning, Mortgages, Saving, Budgeting, Debt, Insurance and Property
- 8% of questions related to debt.
What do Kiwis want to understand about debt?
With 8% of last year’s Money Week questions relating to debt, there were four key themes people were interested in understanding in more detail.
- Buy Now, Pay Later schemes
- Debt Consolidation
- Student Loan Repayments
- Prioritising saving or repaying debt
Some of these questions are topical if you’re also considering applying for a personal loan. How does a personal loan compare to Buy Now Pay Later? Can I use a personal loan for debt consolidation? Should I repay a personal loan first or start saving? Let’s tackle a few of these questions now.
Is afterpay or Buy Now, Pay Later a loan?
It’s important to understand that payment plans such as afterpay or Buy Now, Pay Later are types of debts. They don’t charge you interest or fees, but they will if you miss repayments. Having too many of these payment plans can quickly spiral out of control and be hard to keep track of and manage your repayment responsibilities. In the first half of 2021, their popularity grew 26% for those under 35 years of age. Growth was at 30% for women and 32% for Māori.
How can I consolidate my debt?
Having a single, low interest loan, rather than multiple low, medium and high interest loans can simplify your repayments and get you out of debt faster. One option to achieve this is by applying for a debt consolidation loan. You can better understand the pros and cons of debt consolidation and how you might use it.
Should I save or pay off debt?
If you have high interest debt such as credit or store card debt, or a loan from a payday lender, it often makes sense to pay that debt down before you start focusing on your savings. Check out interest rates for a savings account or term deposit and compare to the interest you’re being charged across your debts – will saving or repaying debt save you the most money? You might want to build an emergency fund so that you don’t have to get into more debt, but if you have extra cash to add to a savings account, consider making additional repayment to your debts to pay these off faster.
How to apply for a debt consolidation loan
With Nectar’s seven-minute online application, you can apply and receive your personalised interest rate within minutes. Once you’re approved for your debt consolidation loan, you can have cash in your bank account the same day. Nectar offers unsecured lending of between $2,000 to $30,000. You can also choose the repayment schedule that suits you and when you receive your wages or salary into your bank account. Budgeting for your debt consolidation loan repayments couldn’t be simpler.
Personal finance advice
Unsure of whether to keep saving or repay your personal loan early? You can access free personal finance services or pay for professional personal finance advice.
How much can you borrow with a personal loan?
With Nectar you can borrow unsecured up to $30,000, or as little as $2,000. Use our loan repayment calculator to find out how much you could get.
Getting started with Nectar
Do you need a great rate on a personal loan? We’d love to help with your personal loan requirements. Find out how much you could borrow and learn more about our personal loans. You can get started with Nectar and get a personalised loan quote online which will include your interest rate, maximum borrowing amount and repayment options. Borrow better, faster today!*
*Nectar’s lending criteria and responsible lending checks apply.