Part Two: Reducing debt so your KiwiSaver is spent well 21 Dec 2015
Part two following on from our last blog discusses practical ways to saving money so that your KiwiSaver savings can go on funding an enjoyable lifestyle in the current rather than merely covering debt repayments from years’ worth of HPs, credit cards and finance etc.
1. Become a one car household: You can literally save yourself thousands of dollars a year by only using one car. The average vehicle owner spends over $9,000 per year to own and operate their vehicle. If you use this money to pay down your debt, it will make a huge difference. You may think you don’t spend much on your second vehicle as you don’t often need to put petrol in it, however the cost of WOF’s, registration and insurance are still there regardless whether it is sitting in the garage or on the road.
2. Save of your food bill: Try stocking up on groceries when they are on sale, or go one step further and stockpile when they are on sale and then skip one grocery shop every month and live off of the food you stockpiled.
3. Track your spending and pull it back: $20 here and $20 there doesn’t feel like much at the time, but when you add up that spending over a month, it could in fact surprise you. Be honest and don’t leave anything out. You might be shocked on how much you are spending on certain aspects of your life. Once the reality is in front of you, you can pull back your spending habits and put the money saved on debt repayments.
Paying off your debts as soon as possible means that once you hit retirement your KiwiSaver fund can do just that… FUND your current lifestyle rather than paying for years of bad spending habits.