Help saving money

Simran Kaur is the co-founder of Girls That Invest, which offers commentary on personal investment, aimed at young people.

My partner and I have been arguing non-stop about how much to spend on our upcoming wedding. I’ve imagined having a somewhat extravagant celebration with all our relatives invited, as I come from a large family, while my partner prefers a more intimate and budget-friendly event. We can’t seem to find a middle ground, and the tension is starting to affect our relationship. What should we do to resolve this wedding spending dispute?

Planning a wedding can be an exciting and joyous time, but with the average Kiwi wedding costing over $30,000, it can also bring about disagreements and unwanted strain when it comes to budgeting.

After accounting for the cost of the venue and the cake, along with all those niggly things you don’t expect like makeup trials, celebrant fees and wedding favours, costs can really start to add up. Where do you draw the line?

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Pinpoint the priorities

Before you get into another heated debate on whether your uncle’s cousin’s son’s dog should be invited to the wedding or going back and forth on how much is reasonable to spend, first understand what you each value most.

The first step in finding a compromise is to understand and empathise with each other’s viewpoints. Take the time to communicate openly and honestly about your desires, expectations, and concerns regarding the wedding. By listening attentively to one another, you can gain insight into the underlying reasons behind your partner’s preferences, and what it is that they need the most.

You may be surprised that the number of guests isn’t as high on their list, maybe they value a nicer venue with fewer guests, or maybe the guest list takes priority and they’re willing to downgrade some of the entertainment packages to accommodate a bigger venue. It’s about finding what is important to each other first, and then allocating a budget to that.

Make sure no matter what, you’re not going into debt

Weddings can have a significant financial impact on couples and their future together. It’s essential to consider the long-term implications of wedding spending. According to a survey by The Knot, nearly 45% of couples said they went into debt to finance their weddings.

This debt can put a strain on newlyweds as they begin their lives together. Discussing these financial concerns openly can help you both make informed decisions. I’m not firm with a lot of financial planning opinions, but no one should be going into debt for a one-day affair. Your friends would more than happily celebrate in your backyard rather than watch you spend years trying to fight your way out of consumer debt.

Revisit your future goals

The memories from a wedding will last you a lifetime, but the event itself isn’t forever. Have a discussion with your partner about what increasing or decreasing your budget would mean for your future goals. You may want to bring up the wedding budget up by $20,000, or if you’re South Asian like myself, you may feel societal pressure to host a five-day event that runs you over $100,000. However, it’s easy to get lost in the numbers

Instead, try to put those figures into context. If you spend $30,000 instead of $60,000 where else can you allocate that extra cash? Is an extra $30,000 going to help you get to that house deposit faster, or would you prefer to invite more guests to a larger wedding venue?

What can you save money on

No matter what kind of wedding budget you’re working with, there are always numerous ways to have a beautiful and memorable celebration without breaking the bank.

Consider exploring cost-saving alternatives that still align with your vision. For instance, instead of a traditional wedding venue, you could opt for an Airbnb that allows for weddings. Choose off-peak dates and times. Saturdays and evenings tend to be the most expensive. Opting for seasonal and local flowers and limiting the menu selection are other ways to keep costs down while providing unique and charming settings.

When it comes to wedding planning and budgeting, it’s important to understand each other’s priorities, avoid going into debt, consider future goals, and explore cost-saving alternatives. By openly communicating, empathising with each other’s viewpoints, and making informed decisions, you can find a compromise that satisfies both partners and ensures a memorable wedding day without unnecessary financial strain. Remember, the true value of a wedding lies in the love and commitment shared between you and your partner, not the amount of money spent.

Katrina Shanks is the chief executive of Financial Advice New Zealand.

OPINION: The warnings have been there for quite some time to expect big and ongoing increases in the cost of living this year.

We know the formula. They’ve been driven by higher wages due to our tight labour market, higher input costs due to freight cost increases such as the price of fuel, higher household costs (rents, rates, maintenance), and by higher interest rates designed to slow spending and get inflation under control.

It’s a vicious circle.

Warnings have been particularly aimed at those with mortgages due for renewal this year, but they are affecting everyone.

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And now those warnings are beginning to show up in the data.

The latest report from credit reporting agency Centrix shows the number of consumer accounts in arrears climbed by 11.8% in March. This compared to 11.5% in February and was mainly for buy now, pay later and unsecured personal loans.

Centrix said it was clear the increase was due to many more people feeling the cost of living pressure to meet repayment obligations. Mortgage arrears also climbed in March, for the eighth consecutive month, with 19,300 residential mortgages reported as past due – up 26% year-on-year.

And businesses are not immune, and it’s here there is even greater concern, because when businesses suffer and struggle, so do their employees.

A business feeling the squeeze and struggling to pay its way can lead to layoffs and families without an income as costs are trimmed in an effort to stay afloat.

Centrix says this is happening more and more.

Their data shows in March there were substantially more companies defaulting on their loans than at the same time last year.

In the construction sector, defaults were up 13%, in retail, 12%, hospitality 10%, and in property defaults were up by 3%.

Centrix said in the hospitality sector alone the more than 28,000 registered companies (4% of all registered companies) are right now two-and-a-half times more likely to fail than the typical New Zealand business. They accounted for 10% of all company liquidations in the past 12 months.

It’s a dire situation for many, and remember that something like 95% of companies are small to medium enterprises that are family-owned and operated and often don’t have either a lot of spare cash in the bank or a parent company to bail them out.

So, what are the options for a business that finds itself behind in business loan repayments?

When a customer is in arrears with repayments, they normally get escalated to a risk manager in the bank who will look at the customer’s options.

These can involve interest-only payments that can reduce the payments due. Or reduced payments over a longer period.

But to do this, the bank needs to have an in-depth understanding of the businesses’ current and future position and understand how it will trade itself out of the difficulty.

The business operator will have to spend the time on a business plan to formulate how that could work.

This may involve lowering inventory levels, which means less money is sitting dormant tied up in goods in the storeroom.

It may mean increasing margins, though this comes with a risk of losing customers who, in tight times themselves, may decide to shop around.

Other options include reducing credit for customers who are slow payers, dealing with fewer suppliers, which may give mean you can negotiate better terms with those you keep, getting longer credit terms with your supplier, or moving to cheaper premises.

There are many levers that you can pull in a business which can help with your cashflow.

But if your business is in hardship and you’ve tried some of these options and they haven’t been enough, the lender will consider hardship solutions.

But be aware this will be noted on your credit file and that may impact your ability to borrow in the future.

There are several rules of thumb to help you repay loans and get through the hump and back onto a sound footing:

• Reach out for help from the lender as soon as possible – they don’t want your business to fail so they will try as hard as they can to find a solution.

• Talk to someone else – the problem should be shared and talked through with a mentor, colleague, or partner. This will help with your stress. You don’t need to be alone.

• Plan, plan, plan – sit down and work out a way forward. Doing the same thing gets the same results, so think about what you can change, or understand the environment and ask yourself will that change make a difference.

• Work out how much breathing space you need and build that into your plan.

The bank is not your only option to obtain funding – there are non-bank lenders who are reputable and offer relatively good terms. In many instances, the interest rates will be higher than a traditional bank, but they are a good short-term solution if you need to consolidate your debt.

If your business cannot trade out of its financial position, seek professional help as to what your next steps are. Being a business owner can be a lonely, exhausting and stressful – you don’t have to do this alone.

David Boyle is the head of sales and marketing at Mint Asset Management.

OPINION: Looking back, when I was a kid my parents got me involved in a lot of activities after school, including tennis, piano lessons, elocution lessons (now called speech and drama), rugby, and last, but by no means least, Cubs and Scouts .

It’s fair to say some of those activities didn’t work out too well, but others taught me some great lessons that are still with me today. One of the key messages from my scouting days was “be prepared” a theme taken from the founder, Lord Bayden-Powell, and which originated more around being attacked by your enemies than thinking about retirement, but it’s as good an analogy as I could find for this topic.

Retirement is a funny thing. It seems far off but, before you know it, it’s just around the corner and you are wondering how you got here. Well, as Talking Heads state, it’s once in a lifetime (if you are lucky to get there at all) and being prepared for the big R is something we all need to think about, even before you are ready to do so.

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In the past, a lot of jobs were incredibly physical and there came a time when workers’ bodies, not their minds, would tell them to stop. So, back in the day, many people didn’t have a choice. Both my grandfathers died in their late 60s because they worked in the mines and the coal dust in their lungs eventually got to them.

While there are still a number of physical jobs here in Aotearoa, the majority of Kiwis aren’t facing anything much more dangerous than the risk of paper cuts or repetitive strain injury , neither of which is too life-threatening. So, over the past 50 years or so, we are generally living longer, which is a great outcome for many.

We have all seen inspirational stories of people reaching into their 90s and even 100, doing exceptional things, and thinking ‘wow, how cool is that?’ But most of us will slow down before then – at best we might hope for 20 more summers if we retire at 65, and they might not all be sunny affairs. So, it’s a good idea to plan how to make the most of them while we can.

There are a heap of checklists and plans you can follow around how much money you’ll need in retirement. But have you thought about what else is important to enjoy the journey, given we are all going to the same destination no matter how rich we are?

Here are five ideas to help you start working on the other stuff:

Write down the things that are important for you to do now and what you want to continue doing when you stop paid work

For example, I want to play tennis into my late 70s. So, what do I need to do to achieve that? Well, keep playing for a start, maybe make time to get regular lessons again, and keep as healthy as I can along the way, without sacrificing the treats. Chocolate comes to mind for me here. It might mean I have to walk more (which I hate) but, as they say, if you don’t use it you will lose it.

Work out how you will maintain purpose and relevance when you leave your job or career

I have seen many incredibly successful people hit the retirement wall and struggle to get over it. Being out of sight, out of mind is challenging. When you are used to the phone ringing or people coming to you with problems or challenges at work, it can be hard to adjust when you leave. The phone stops ringing, people don’t need you and your perceived value goes away.

Before you get there, think about activities, both paid and unpaid, that you could explore or plan for when you make that decision. It could be sitting on a board or two; it might be getting involved in your local community and using your work and life skills to help others; or it could mean just working fewer days.

Write down a list of things you have always wanted to do but never had the time to complete

It could be as simple as driving along in the countryside and stopping off at that small town or village that you never had time to explore, or a big ticket item like going overseas to see the northern lights in Iceland. It might mean spending more time with family and friends or taking up a new hobby. Don’t forget to discuss the list with your partner or family as well. Letting them know helps them plan a little as well.

Have a chat with a friend, colleague or family member who has already retired

Ask them how they felt when they made that decision (or had it made for them). What were their fears and hopes? What did they wish they had done more of before getting there and their biggest regrets?

Enjoy the journey and understand the benefits of decumulation

I know I wasn’t going to talk about money but, while it’s not everything, (my mum always said to me if you don’t have your health, you have nothing) it does provide you with choices. They key is knowing how much you need to be happy. That’s like asking someone how long is a piece of string.

Sit down and do your own numbers, but take into account superannuation, KiwiSaver and other investments, even your home or other assets you might have. Another option might be to downsize your house or live in a different area and release some capital.

The worst thing that could happen to me is I work another seven years, which would mean I would have worked 48 years without a break, only to have an accident or health issue that robbed me of all the experiences I had put off when I thought I would have more time to enjoy them.

I’m not the fittest fellow it has to be said, but I have caught myself recently thinking, while standing in the mosh pit in front of a live band at Auckland’s Powerstation, how much longer will I find this enjoyable? Ages I hope, but there will come a time you might find me at the back of a concert, smiling away, knowing I did it for as long as I could and not regretting a minute of it.

Disclaimer: David Boyle is Head of Sales and Marketing at Mint Asset Management Limited . The above article is intended to provide information and does not purport to give investment advice.

Mint Asset Management is the issuer of the Mint Asset Management Funds. Download a copy of the product disclosure statement here.