HiFX vs ASB on Exchange rates.
Filed under: Avalon's Money Thread, Banks, Exchannge Rate & Currency Transfers
So, having opened up our US$ account, we needed to put US$10,000 into it.
For the past week, I have been watching the exchange rate, and using HiFX’s online system to check how much in NZ$ it would cost me to buy US$10,000.
I decided this morning after an overnight rise to make the move.
HiFX were quoting
NZ$ 12,632.00
I phoned ASB Global Markets (this is the branch that operates the Foreign Currency Accounts) and got a rate of…
NZ$ 12,618.00
That’s a saving of $14.00. Small but I will take it. Also, over the past few days – its come down from a more expensive NZ$ 12,744. So by waiting I have actually saved $126.
What bugs me though is that HiFX should not be able to be beaten by the banks. Because of the amounts I was looking at there were no fees with HiFX, and yet they still have a rate significantly worse than the bank was offering.
There is something seriously screwed up at HiFX these days. I wish they would sort it out, but given the snotty attitude last time I tried to talk to them about it – I get the feeling the can’t be arsed.
Opening a US$ account at ASB
Filed under: Avalon's Money Thread, Banks, Exchannge Rate & Currency Transfers
We have decided to open up a US$ account here in New Zealand. While our original UK accounts are still active, and based in the UK, we really don’t need a UK£ account here. But the issue we have at the moment is that the shares we hold in IBM are in US$. And while the share price and the dividends we get are quite nice in US$ amounts, once we pay them into our NZ$ account, we really aren’t getting our moneys worth.
So by letting the money sit in a US$ account, we can wait till the rate improves and get a better deal.
For ease we have opened up the US$ account at ASB. Applying is fairly straightforward – the major hitch is that you need to put a certain amount into the account to open it (amount depends on the currency). In the case of US$ – you need $10,000. Not exactly pocket change.
Now we have managed to get that, basically because I have that money in out Tax Savings account. It’s money that really doesn’t belong to us – we will need to pay it to the tax man – but because we are self employed – we don’t have to pay it for ages. So we borrow the funds to get the account set up.
The nice thing is that you don’t have to KEEP US$10,000 in the account.
You just need to put it in there to activate the account. Then you can move it back out when you want to.
There are NO FEES to operate the account. There are some fairly hefty fees if you want to do certain things – like get a NZ$ bank draft from the account – but that is basically the same with any ASB account. And if you wanted to pay cash into the account – that would cost. But electronic transfers into the account, or paying US$ cheques in costs nothing.
Which is good.
What is not so good is that if you do pay a foreign currency cheque into ANY ASB account (whether your normal current account or a foreign currency account) ASB sit on it for 21 working days. That’s basically a month. (Usual guff about money laundering blah blah blah).
In your normal account, it just sits there, gets noted on your statement and is in the Account Balance, but doesn’t get added to the Available Balance until the 21 (working) days are up.
In a foreign Currency Account, it sits in a separate Term Deposit before being cleared and transferred to your Foreign Currency Cash account. If you transfer money from your normal NZ account into the US$ account – that is not held for 21 days and shows up as usual.
Also, its worth noting that from my parents experience, paying cheques into these accounts generates a forest worth of paperwork. So make sure you have a good filing system for it.
Where to save some money.
Filed under: Avalon's Money Thread, Cost of living, General Budgeting
2 things have happened in the last month which have actually changed the way I need to handle our money – after 6 years of doing the same thing:
- We have a small issue this month with a new contract which pays on a different day to normal – so our income projections and bank balances are skewed – which means we can’t pay ourselves at the end of the month as usual.
- I have actually swapped the last of our personal mortgage onto the business (which means the interest is now a business expense) so instead of making sure as much money as possible stays in our personal account to reduce interest – I now need to keep the money in the business accounts as long as possible.
I have to admit – its all taking a bit of thinking about and planning.
But ho hum – needs must when the devil calls round for tea!
Because of this, and the fact that I really do want to get some more emergency funds behind us, I have decided it’s time to refresh the budgets and look at some cost savings:
1/ Changing the power bills.
I’m a huge fan of saving money without cutting back on things – and items like electricity bills are a perfect example. I wont actually be using less electricity (though that helps obviously) I’m just intending to pay less for it.
Now, there’s a newish website out called What’s My Number. Its being advertised on TV with people looking a tad daft with post-its stuck to their foreheads – showing how much they could save by changing electricity suppliers. I tried that and got:
Well, that’s not a bad start. The thing is the fine print relies on you being on the cheapest plan for your supplier. And you can do a better calculation by clicking through to the parent website: Powerswitch. Now it helps to have a current bill, but according to that I discovered that a/ I am not actually on Meridian’s cheapest plan, and b/ Powershop could be cheaper, by about $109 a year.
So I have used the switching service provided, clicked and signed up for Powershop. Now they are slightly different from normal power retailers in that you can buy electricity up front, and buy cheaper electricity in the summer. I am kinda looking forward to seeing how that works in practice. I quite like the thought of being in control of electricity supply – rather then getting a bill at the end of the month – and from what I understand this could be a good plan for people like me who are happy to spend time actively managing money.
2/ Printer Cartridges.
Jeeze are these the world’s biggest extortion or what? For anyone utterly frustrated by the sheer gob-stopping magnitude of the cost of printer cartridges (and the printers refusal to let you actually empty the damn things) have a look at The Oatmeal: Why I believe printers were sent fom hell to make us miserable.
Now I have had to do a lot of printing lately – and have a number of (not) empty cartridges that lasted all of 5 minutes. I decided in the interest of environmental concern (and tightfistedness) to get them refilled at Cartridge World. Where I rapidly stormed out of in disgust at the whole $4 per cartridge saving on something that costs nearly $30 brand new. This to me is not a suitable discount for refilled cartridges.
So I looked at both Inkpost and NZ Consumables. Now we actually have 2 different printers (Just. Don’t. Ask) both of them are brothers but – you guessed it – use different cartridges. One uses LC57′s which retail at $27.99. Cartridge world want to charge $24.99 to refill them, NZ consu,bales charge $6.84 for a compatible generic. Kachingg!
(I am at this point totally ignoring the dire warning that printers now display about the terrible and deadly (and expensive) consequences of not using proper branded cartridges as being as pointless and absurd (not to say expensive) as Kiwi pharmacists trying to insist using unbranded Ibuprofen will fail to cure my headache. Utter bullcrap!)
Now NZ consumables don’t sell generics for our other cartridges, but I found in that case that InkPost came out cheaper by refilling my old ones or buying their own brand. The new own brands came in at $15.39 instead of a $22.69 for the branded version. Or if I sent in 3 colours I could get them all refilled for $38.39. Considerable cheaper than the snotty lady at Cartridge Wold insisted was a fair price.
So while I have spent a fair amount on new cartridges – it is WAY less than I would have spent in Warehouse Stationary – or at Cartridge World. I’m rather a happy bunny.
3/ Coffee.
Ok – don’t all faint – but I have actually drastically cut down what I spend on coffee.
Now this isn’t a conscious choice to spend less on coffee. I still have a budget for it, and we can actually still afford to cover that. Instead – I just refuse to pay the current cost of buying a coffee in a cafe. A few weeks ago I actually ended up paying $5 for a cup. Now given that I drink Americano’s (with cream – and usually decaf) there is no steaming of milk to do, and its actually pretty straightforward. But now places are usually charging 50c for decaf and I am now getting charged for the cream more often.
Even the cheaper places are at $4 or $4.50 – and I actually don’t think it’s worth that.
So I now tend to save having a coffee out for when I am with friends – rather than because I just want one – and I make my own and chill with a book.
This month – I have so far spent $27.70 on coffee, out of a budget of $100.
And I am kinda having fun doing all this!
Avalon’s Guide is on Sale :)
I am down to my last few copies of Avalon’s Guide, and at this stage am not planning to do another reprint due to the costs involved. So to clear the shelves of the last remaining books – I have decided to drop the price – which also helps with the crummy exchange rate.
So now instead of getting a copy posted to the UK for $46.00, it will cost just $31.00.
Once those have all gone, you will still be able to buy Avalon’s Guide, but only as an E-Book, which is also dropping to $12.00.
Should you be forced to save?
Filed under: Banks, Cost of living, Economics, Property & General Investing, Retirement, Pensions and Kiwisaver
Forced savings – in the form of compulsory superannuation (or – shudders – compulsory Kiwisaver) is back on the agenda in new Zealand. Because apparently, not enough of us are doing as we are told and opening up Kiwisaver accounts. So we need to be made to do it.
This comes out of the Tax Working Group, now we have to pay some more academics to sit around and tell us how we need to save for retirement and how we need to do it. I hope they get different people from the ones that just beat the living crap out of any Kiwi that was using Property to try and fund their retirement. Apparently that doesn’t count as retirement planning, cos it’s not shares or managed funds.
So when they talk about “Forced Savings” just be aware that what they really mean is “Forced Stock Market Investments”.
I’m not impressed – if you couldn’t tell. 
I personally believe that forcing people in a low wage economy like this to give up at least 2% of their after tax salary is just not on. The “theory” is that if we all do this – then it will cause investment in businesses (through the sale of shares) to increase, and those businesses will then be able to pay the staff more.
Anyone actually think your wages are gonna go up?
Because heres the thing (speaking as a complete non-economist here of course):
Buying shares on the stock market does not actually put money into the business. It puts money into the pocket of the guy selling those shares. If that just happens to be the company floating shares – then yeah – you just invested money in that company. Otherwise, some guy on the street sold some shares and you bought them.
BTW, we recently found out that if you work for one of the banks, which just happens to be a “Default Provider” of Kiwisaver (where you money sits if you don’t bother to actively choose a fund), they take their “Employer contributions” out of you salary. So basically, they don’t actually contribute to their own staff’s Kiwisaver fund.
Why is this not illegal, and why is it still being allowed? And how the hell does such a company get to run a default fund???
So regretfully – still not a fan of Kiwisaver, and would still like the government to keep its grubby little paws of my money thank you very much!
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Grabbed One.
Filed under: Avalon's Money Thread, Cost of living, General Budgeting
Theres a new (ish if you are in Auckland) money saving website thats come to New Zealand, and so far – looks good. Its called Grab One, and I found it via Facebook (fount of all things time wasting) via some friends.
So what’s the deal?
Well, you sign up to Grab One, and then when they have a deal – you can choose to accept the deal if its something you like the look of. Now usually, theres going to be a minimum number of people required to sign up for the deal before it becomes “live”, but if you are one of those first people, you will need to give credit card details, and if the deal goes live, you will have bought the deal. After that, if there are still some places left on the deal, you can buy or not as suits you.
Is it worth it?
Well, today was the first day that Grab One had a deal in Wellington, so its the first time i got to try it out.
As we are intending to go to the cinema at least every other week, and as the Embassy Cinema is 5 minutes (slow) walk away – I though this was well worth a try. I mean $3 for a cinema ticket??? Even on Cheap Tuesdays its $10! The downside is that you can only buy one deal per person, but this did allow me to buy a second ticket as a gift – which I thought I had better send to hubby. So that’s 2 tickets to the Embassy for $6, saving us at least $14.
Now there are some conditions: you can’t use it Friday or Saturday evenings, you cant get Platinum seats at the embassy ( those are the bigger leather couch like seats) and you cant use them for deluxe seats at the Lower Hut Cinema (which have reclining backs). But all those conditions were clearly laid out – in normal sized print, and were really easy to understand – so top marks for not trying to hide anything.
So I guess if you can get money off something you were going to buy anyway – this looks absolutely brilliant. But as with all “money saving deals” it only actually saves you money of you were going to buy it anyway. If you start buying things just because they are on offer – then its actually not saving you money – its making you spend it.
How do you find out about the deals?
There are two ways: sign up for email alerts when there’s a deal in your area, or join the Facebook group and get the alerts as posts on your Facebook newsfeed.
This is currently running in Auckland, Wellington, Christchurch and Waikato Region, and looks like they are expanding across New Zealand.
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Briscoes: You’ll never buy better?
Filed under: Avalon's Money Thread, Cost of living, General Budgeting
It’s a really annoying jingle and an even more annoying tagline – more so becuase it’s highly dishonest. Briscoes is a chain of homeware stores across New Zealand known for its permanent sales (advertised as “get in quick – 2 days sale”).
The thing with Briscoes is that from what I have seen – the sale price actually brings it in line with the retail price in most stores. We found this when I bought a coffee machine. They had it “on sale” for $499 down from a supposed RRP of $899. Except when i was doing my price checks, I couldnt find any other store that sold it for for more than $499. We ended up buying it at Moore Wilsons.
We have done the same price checks today, and out of 10 separate items, only one of them came out cheaper at Briscoes – a Tefal frying pan which would normally have been the same price as in Moore Wilsons, but had 40% off in Brisoces, and this time Briscoes weren’t exaggerating the price before discounting.
Just be aware of this kind of thing. I have found time and again that “sales” “bulk buys” and “special prices” of all descriptions are a con over here. Why the commerce commission allows it I have no idea – but it really will pay you to check your prices before buying.
Today we saved about $50 on three items where there was a cost difference, and will save another $150 on a few items that I know are cheaper in Wellington stores. Its a start.
Unfortunately I cant actually spend that on coffee!
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Arghhh – having to pay interest on the credit card!
Filed under: Avalon's Money Thread, Cost of living, Interest Rates, Credit Cards & Mortgages in NZ
Well, for the first time in five and half years – I cannot pay off the whole balance on our credit cards, and we will be paying interest.
This is quite depressing.
I guess I should be happy that its only likely to be a few months where we have to pay, and that we have been able to organise our finances so well for so long that we haven’t had to do this thus far while we have lived in New Zealand. But still – its damned annoying.
Especially since the interest rate is a whopping 19.95%
So – from here on in – hard nosed budgeting and spending restrictions to get us back on track as fast as possible.
Why has this happened?
Some really big bills I’m afraid. Despite the emergency fund, which I still have some left of, we have had some really big expenses come through and no income. The emergency fund is coving our living expenses and top ups on the rentals, but it cant cover:
- Some large medical bills.
- Set up costs for Hubby’s contracting business.
- Legal fees
- Buying furniture for an apartment in the city. (and yes – even though we have 2 houses worth of furniture – it still turns out we need a few things – that was a depressing moment!)
Hubby has income coming in now, but almost all of it is paying the setup costs: new computer, travel, phones, internet bills, city pad – it all adds up.
And at least this time I actually know what I’m doing. I know how to work through the budgets, I know how to cut costs, and I know how to stick to the harder decisions. One thing I am sure of – that debt is not going to be there long. Ill be paying money into it as soon and as often as I can.
I’m just not sure how to cut my coffee budget
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What is Swedish Rounding?
In new Zealand our smallest coin is now the 10c piece. Which means if you want to buy something with a price of say $1.99 you can’t get change and effectively get overcharged.
Swedish Rounding basically says that if it’s 5 or under at the end the shop will round down and it’s over 5 they will round up. It’s often dependent on the individual shop as to whether the 5 ( being the midpoint) rounds up or down
So what’s the problem?
Normally it really doesn’t cause a huge issue – for me it’s the principle of the thing that no matter how you pay for something the price charged should be the price you saw on the item. In effect this means that all prices would need to altered to be multiples of 10c which I an damn sure would mean everything goes up in price rather than down.
A good example of this is the the old 45c stamp for standard post in New Zealand. A few people got uppity (fairly I feel) that they tried to buy a single stamp – not needing more than one at the time, and found it cost them 50c. Funnily enough now there is no 45c stamp – the price went up to 50c.
Of course if you pay on an eftpos card or credit card it becomes irrelevant as the amount charged is the exact a
amount of the bill. Oddly shop staff often tell you the bill is a round dollar amount, but what gets charged is the exact amount. I have come across two notable exceptions to this. One was a chain healthfood store who tried to round up from $5.95 to $6.00 and got told to sod off. The other was Radius Pharmacy on Lambton quay who rounded up from $26.95 to $27.00. I didn’t notice that till I got home and did the accounts (many stores actually don’t show you the amount they plug into the cc machine which in itself was a bit naughty). I just assumed that as normal they were telling me the rounded amount but would charge the right amount. I’m not shopping there again
Okay it’s small change. Shops would have to round up 5c seventy or eighty times before I’ve lost the cost of even one coffee. And even then you should find that you get rounded down and save as often as you round up if yo are buying a bunch of things together. With single items though – well – how many things are priced .34 rather than .99?
But what about people on low incomes? And bear in mind that as a migrant that might be you. Low income people tend to pay cash more to avoid the eftpos fees, and don’t have credit cards. So already they are more at risk of getting rounded up than I am with my credit cards. $3.50 lost may not be much to me personally in the long run (though I still to object to it) but for many people that actually could make s huge difference. I wonder if anyone has ever sat down and worked out whether the amount saved by rounding down is the same or more than the amount overpaid by rounding up?
With a Hat Tip for Wafu for his comment which gave me the idea for this blog post.
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What does your credit card bill say about you?
Filed under: Cost of living, General Budgeting, Life in New Zealand
For some bizarre reason this morning, hubby had a flick through the credit card bill that arrived yesterday, and noticed that there seemed to be a marked preference for spending in a certain type of shop.
So for you amusement – here are the types of items you can see on our credit card statement.
Supermarket – 15 Items
Business stuff – 2 Items
Medicines & Health care – 2 Items
DIY – 2 Items
Health Insurance – 1 item
Clothes – 1 Item
Cinema – 1 Item
Utilities – 2 Items
Books & DVD’s – 7 Items
Online Gaming – 4 Items
Cafes and Restuarants – 21 Items
Ooops. I’m off for a coffee to drown my sorrows!
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