Do you need to move to New Zealand to get a new life?
Filed under: Getting to New Zealand, Hubby's Views, Jobs & Work, Life in New Zealand
I was recently catching up on some podcasts I’ve had sitting on the iPod for months and not quite got round to listening to. One particularly interesting one from way back on the 2nd of May 2008 was from the BBC’s World Service Documentaries feed on iTunes. (anyone without iTunes can use the BBC World service website ), entitled Escape to New Zealand.
The interviewer was speaking with two couples from America & Germany both of whom sought a new life in New Zealand to escape from global warming and home country politics.
Once here, both couples felt closer to a more natural way of living, with a greater ability to live a happier way of life and change how they chose to live their lives. Personally, I’ve found that most Kiwi’s are more accepting of people living a different way of life, whatever that happens to be. When I’m working in Wellington, I leave the office at 4pm so I can catch the train home. Colleagues and customers are fine with this, no issues. If I’d done this while in the UK, I’d be on the receiving end of (not entirely joking) comments about being a part timer and only doing a half-day!
In terms of changing your life, the whole experience of upping sticks to the other side of the planet is quite daunting. The question is though:
Do we really have to move to another country to change our lives?
Often a big one off change is easier to achieve than a small change to daily habits, especially when others around us don’t want to see us change or improve.
So yeah, it’s interesting, what are we escaping from when we come to New Zealand? Are we just searching for a better way of life? Could we achieve the same thing (a more balanced way of life) by making changes to our lives where we are? Why are most of us afraid to work only the hours we are paid to back in our home country, and demand that we get to spend time with our families? Instead – we leave for a new life in a New Country.
Hubby.
Interest rate in New Zealand is now 3.5%
Filed under: Interest Rates, Credit Cards & Mortgages in NZ
Alan Bollard, of the Reserve Bank of New Zealand, whacked a stunning 1.5% off the official cash rate.
This means that we don’t have the highest OCR anymore – Australia sits at 4%.
Just have a look at this graph from www.interest.co.nz
Now – hands up who could have predicted that?
Oh well, it means at least my personal mortgage is going to paid off even faster. And even better for anyone who has a 20% deposit to buy a house.
You can read a fuller blog about this – with plenty of commentary from readers at The Ratesblog.
How much does it cost to send you child to school in New Zealand? – Follow up.
Filed under: Cost of living, General Budgeting, Life in New Zealand
After writing a while back about the costs involved in funding your child’s school year, I watched a rather interesting piece last night on Campbell Live. (7pm TV3)
Marlborough Boys College have nearly doubled the “donation” that parents are asked to pay – from $110 last year – to $200 this year. The cause of this is apparently due to a $1.7m debts incurred, some of which was lost when the school decided to open an Overseas branch in China, offering New Zealand qualifications. The school board is apparently putting the problem down to having too many teachers. Hmmm. That’s a bit like saying the UK NHS has too many nurses.
(Why is it that Front line staff – the ones that actually produce the work – are the ones that get axed first? The mind Boggles).
It appears that the school also spent $250,000 on a computer network believing it would be funded by the Ministry Of Education – but didn’t follow the process properly and can’t get the funds back.
My thought on this is that its quite appalling to expect the parents of the students to fork out extra payments to cover what appears to be some appalling business decisions made by the school. There is just something quite awful about that: lets face it – no one is going to bail me out if my business decisions for the last year end up in a pickle.
On a positive note – there was also a small section about a group of Auckland Uni students who have set up a scheme to go into schools and teach the kids basic money management skills. They mentioned that 88% of high school students do not know how to read a bank statement. I wonder if the number for adults is much higher?
This is something that desperately needs to happen. Financial literacy in the UK and in NZ is appalling – and to be honest – it’s really not at all hard to learn the basics of opening bank statements, keeping track of your sending, and spending less than you earn.
The most head turning quote of the whole thing was from a young girl how said, “I find it harder to spend the money I earn, rather than the money my Mum gives me”.
Hmmm,I think that suggests maybe all these bailout packages may not have the effect they are intended to.
Interest rate break fees – Labour is kicking up a stink.
Filed under: Banks, Interest Rates, Credit Cards & Mortgages in NZ
Wehey!
I blogged about this a while back: the outrageous break fees that banks are charging to allow people to get out of high fixed rate mortgages. With banks such as Westpac charging the difference between your current rate and the wholesale rate – it’s a rip off of epic proportions.
So Phil Goff (current leader of the New Zealand Labour Party) is speaking out.
I really hope it makes a difference and someone somewhere listens to him. We can cope with the high rate on our mortgage – but there are many people who can’t. And to be honest I don’t see who on earth it helps for the banks to insist that people pay these high rates and go bankrupt. I mean – it’s not as if the banks are having much luck offloading their “Mortgagee sales”.
If a homeowner could hang on to their house by paying a mortgage at the lower rate, but is going down the gurgler paying nearly 9%, is it really in anyone’s interest to insist they can’t break the fee without paying a humongous penalty?
Now – I need to make clear – I am not suggesting that everyone should get away with ditching their high fixed rates because they can’t be arsed to pay their mortgage. Not at all – it’s just that these are spectacularly odd times – and I feel a little flexibility and perspective from the banks would not go amiss.
And if your bank is one of the ones being particularly vicious about this – and insisting on paying the difference between the wholesale rate – rather than the retail rate – Remember it. For a VERY long time. Because there will come a time when the cycle moves round and that very same bank will be begging you to give them your business. And you can take a great deal of pleasure in telling them where to stuff it.
Will New Zealand’s interest rates fall again this week?
Filed under: Banks, Interest Rates, Credit Cards & Mortgages in NZ, Property & General Investing
The reserve Bank of New Zealand meets again on Thursday this week, to decide on Interest rates.
According to Interest.co.nz – it is expected that Alan Bollard (bless his little cotton socks) will reduce the official cash rate (OCR) by 100 points (That’s 1% to us normal people).
Of course – this is no use whatsoever to me personally when I have 2 large fixed rate mortgages with another 4 years to run, and I know I’m not alone.
And it won’t help that many first time buyers as the banks are being rigidly unhelpful at the moment – you need a 20% deposit to be able to access the new low mortgage rates. For the same reason – I am not the only property investor who can find really good cashflow properties; but cannot actually but them.
Interestingly – if Mr Bollard does reduce the rate by 1% -taking it to 4% – it will mean that New Zealand has the lowest official cash rate it has ever had since the OCR was introduced in March 99 – when it was at 4.5%.
You know – the one thing that really peeves me about all this – is that Mr Bollard has not apologised for screwing up the interest rates in the first place. Now – it is just my opinion – as a non-economist – that he did in fact screw up – but I vividly remember his snotty pronouncements last year that he had to hammer us all for spending too much money, and he would keep raising rates till we did as we were told.
So having left many people, including banks and mortgage brokers, with the expectation that rates would keep climbing and climbing till he had inflicted enough pain – he then did the most amazing U-turn and rates have been dropping like a stone ever since. Which leaves a lot of people up the swanny. If you can’t access the new low rates – you are still paying around 9%-10% on your mortgage, with no way of getting out of it. (The Break fees basically mean you pay the next so many years of interest in one hit).
It is an uncomfortable time for many people. We are personally in an OK position. We did not have time to overextend ourselves with our rental properties, and we still have a relatively high income – which means we can actually pay all our mortgages – even at the high rates. And we do have emergency funds to call on, and shares we could sell if we had to. Many people who fixed their mortgages in the belief that Alan Bollard would keep raising rates as he said he would – are not in such a good position.
While I do not think either the banks or the Reserve bank should take responsibility for the decisions of individuals to overspend – I do feel that they could be just a little bit more contrite about their own roles in the ensuing financial crisis. As ever – it is businesses and banks that get guarantees and bailouts.
Individuals get bugger all and forced into Mortgagee sales.
Handling your money differently – you won’t be the only one.
I have just read an interesting blog at Pennyscraper. Here is a guy who has been laid off by the credit crunch, and yet – needs to save up to get married. So what do him and his fiancé do? They are living off her salary alone, and using any money he earns to pay for the wedding. Smart.
They are using accounts software to record their spending and budgets, and know where they need to cut back.
So – we aren’t the only ones who live off one salary. We do it differently – and have chosen to use the fact that we can live off a single salary by being less reckless with our spending – to allow one of us not to have a job. But hey – there’s more than one way to beat the system.
You can read more about how and why we do this in Avalon’s Guide. While the book is aimed primarily at Migrants coming to New Zealand – it is also a story of our journey towards financial freedom and the choices we have made to help us get there.
I wish Pennyscraper and his fiancé the best of luck. It is possible – we have done it. I only wish we had figured this stuff out before we got married, and had used my earnings solely to pay for the wedding. Our lives for the first year of marriage may have been a little less stressful.
[10/12/2009 NB it looks like the Penny Scaper forum is offline now, although he is active on Facebook the old link was www.pennyscraper.com/2009/01/14/our-monthly-spending-budget-for-2009/]
I’m a very stupid lobster.
I went to the beach yesterday. Again.
Now I am paying the price for not reapplying my sunblock. You could fry eggs on my back right now.
Now – firstly – this does not usually happen to me. I tend to be in the “pale and interesting” category – rather than trying to get tanned. And as I don’t really like very hot weather – I also tend to stay out the sun. And if that wasn’t enough – having a school friend die from Skin cancer at the age of 21 has tended to make me very wary of going out without sunblock on.
I don’t mess around with SPF’s of 15 – I go for the industrial strength “nothing’s getting through this sucker” stuff, and sarongs to wrap me up.
Once or twice – I’ve missed a bit with sunblock – and you can see some very funny parts where the sunblock ends and I get a small patch of red, but that is not what happened.
I use the Sun Sense range of creams. These are brilliant – and what you need in the harsh sun of New Zealand. We have a hole in the Ozone layer right above us – so the sun is even more dangerous than usual. I found out about these back in the UK funnily enough. A very well respected doctor that worked in the surgery next to the pharmacy I was running insisted on this range for his patients. At the time we had to get them specially ordered from Australia, as they were not easily available in the UK. Thankfully they now are.
I go for the Sports version – waterproof – so good for going in the sea. And normally – it actually protects me all day. I think yesterdays lesson is that even that needs to be helped with covering up – and we forgot to take the bottle with us – so we couldn’t re-apply.
Mind you – we went early in the morning –and were supposed to be going home by midday – to keep out of the worst of the sun. Thing is – when we looked at the watch – it was already 3pm. We just totally lost track of time. It’s easily done – life just melts away when we get to the beach.
Just one thing – the Cancer society here sells its own brand of sun lotion. The only time I used it – and that was for a short time in the sun – I fried to a crisp. I’m sticking with Sun Sense – and a bit more common sense on my part.
Do take care when emigrating to New Zealand. The sun is fierce – and if you are only really used to what a UK summer looks like – you could be in for a bit of a shock.
Petrol Price drops in New Zealand – well that didn’t last long did it???
For the forth time in a week – petrol prices here in New Zealand have gone up 5c a litre. For the usual excuses reasons: Cost of oil and the exchange rate. Humpf.
So any happiness we may have felt at prices being back down to the level they were about 3 years ago – was very short lived. I wonder if that had anything to do with Christmas and the big petrol companies not wanting to been quite so badly.
I mean – just before Christmas we were getting up to $2.20 a litre.
Over the holiday – it dropped to $1.33 a litre.
Now its $1.53 a litre.
(Prices for 91 Octane)
You know – the thing I hate most about this – is how on earth do you set a budget for the next years fuel costs? I’ve been happy as Larry this last month or so – because we have saved a good $300 in fuel bills, but that doesn’t look like its going to last long.
But how do I price up my proposed spending for the next year. I can’t bank on prices staying at $1.55. I at the moment – I’m looking at having to take my most expensive month from last year – and budget that amount every month for this year. I guess on the positive side – that should give me a nice bit of leeway – and if petrol prices don’t shoot all the way back up then we would have a bit of spare cash each month.
I just wish we could have had the cheap fuel a bit longer. I’m sure I can’t be the only one who was breathing a sigh of relief when the prices came down. It really does make a huge impact on the cost of living. We were paying about $30 less on a tank of fuel compared to when prices hit their highest.
That’s over 7 coffees.
And: while it’s not exactly a money saving tip – as you don’t really get “cheaper petrol” by going to a different station as much as you do in the UK, there is a website that keeps a track of petrol prices at different stations in your area.
Check out Pricewatch
How much is your life worth?
Filed under: Cost of living, General Budgeting, Property & General Investing, Retirement, Pensions and Kiwisaver
Yesterday we went to have a chat with our Financial Planner – Alan at FSB4. We really had to sit down and tackle our insurance policies: Life, Trauma, Critical Illness and Income Protection. None of which even I can consider exciting – but has to be done.
Now – generally when we have sat down with people about this – the conversation usually runs along the lines of the Sales person asking who much cover we want, and then getting us quotes for what it will cost us.
This one however –went a little differently (and I always like Different).
Alan asked us what we needed to cover.
So we had to go through all our mortgages, how we wanted to be “sent off” when we pop our clogs, how many people we wanted to supply flights for to send us off (Tough – you are on your own – pay for your own flights if you want to say goodbye!), any bequests, for how many years we wanted to not have to work if anything happened, and a really cool “Recovery fund” which is basically money we can use to help us “get over the trauma” of whatever goes wrong.
It was a VERY BIG NUMBER.
And – it’s going to COST A LOT.
How many suitcases stuffed with money we will need to spend to buy the level of cover we need – is being worked on. But I may have to add a shot of brandy to the coffee that Alan had better be buying me when we have that conversation.
Now – here’s an interesting thing: turns out we have “a lot” of investment properties (that’s 3!), and basically in times past – when people died – they just sell enough properties so that they can live of the rent. Only that ain’t gonna happen now – because prices have tanked. So one way or another – we actually need to make sure we can pay off those mortgages if Hubby is no longer able to earn.
We were woefully underinsured when we sat down and worked it out. At a rough guess – our Life Insurance is probably about half what it needs to be.
And also at a rough guess – we may need as much as an extra $500 a month to pay for it. As good as I think I am at budgeting – that is gonna be tough. We were due to do one of our Budget Reviews at the weekend, but I have decided that we may as well wait till we have some firmer numbers about the cost of this – and then at least I know what to aim for.
At that point – we have to prioritise our insurance requirements (because I’m not giving up my Coffee Budget for life Insurance – no way!).
Insurance and risk planning are things that tend to get forgotten about – but it doesn’t hurt to occasionally sit down and work out just how many $$$ your life is worth. It is probably an awful lot more than you think it is.
Flights from Masterton To Auckland are GO!
We are officially on the map.
It’s been a long time coming, and has had a lot of false starts, but from February 15th 2009, we poor country bumpkins will be able to fly directly from Masterton to the big City that is Auckland. Without having to drive an hour and a half to Wellington in order to fly for 50 minutes to Auckland.
I have to say – thank fiddle-dee-do for that!
Hubby does have to travel to Auckland on a semi-regular basis, and it can be a pain having to get up at the crack of dawn to race to the airport in Welly in order to get to Auckland in time for a days work.
We have been reasonably lucky in that IBM will often pay for a Wellington hotel the night before the flight, but many people here are not so lucky.
Of course – we ain’t gonna get Smartsaver seats – but to be honest – with a trip to Welly and back costing about $50 in petrol (when petrol is fairly cheap), and taking into account the extra hour in bed – it’s really not too bad.
Flights for the first week are being charged at $170 each way. If you fly from Wellington, at the moment, you can get a smart saver fare for $93 each way, but once the Smartsaver fare is gone – the cost is $196 each way. So worries that we would be expected to pay nearly $300 each way appear to have been unfound.
We have always had a line in our budget to pay for flights to Auckland for me, so that I can travel with Hubby. I can’t always go with him – so we save it for when he is away overnight, rather than me just heading up for the day. And it means I sometimes get to meet friends for coffee that I wouldn’t otherwise see.
Taken from the Air New Zealand website
So all in all – I think we will be heading up from Masterton from now on. We can put up with only one flight a day each way. Given that we get 3 top notch trains a day to Wellington – I think we are now getting a bit “cosmopolitan”, now having a plane to Auckland as well.
Minor downside is that we will be flying in what my hubby lovingly calls a Phut-Phut plane.
We get one seat each on either side of the aisle – 19 seats in total. Cosy.
Hope they still serve fresh gravity coffee – we are gonna need the wake up.
Buy Avalon’s Guide
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