Arguments about Money

One of the most common sources of conflict in marriage is money, how to spend it, and how to save for things that really matter.

It doesn’t make sense when you think about it logically. Money is simple. Keeping a budget is something an 8-year-old can do.

For a marriage to be wealthy, a couple needs to have more money coming in than going out. It’s just addition and subtraction. Debt needs to be eliminated, and money needs to be saved and invested for the things we want. You know, toes in the sand with a drink in our hand.

If you and your partner follow this rule, you’ll have no financial issues for the rest of your lives. But it doesn’t feel that way, does it? It feels like we need a Master’s degree in Finance and Wealth Management.

But do we?

Dr. John Gottman wanted to find out, so he went to a group of 8-year-olds and asked them for money advice. He told them he works with moms and dads who are fighting about money, so they can stop fighting and love each other more. All the kids understood this.

He told them a story about a couple.

The husband’s story went like this: “I don’t want to save for tomorrow. I want to live for today. I want to spend money enjoying life. Uncle Jack saved up millions of dollars living in a one room condo and he never went out. He never truly enjoyed life. I don’t want that.”

The wife’s story went like this: “My family grew up poor. We never had any money when an emergency came up or if somebody got sick. We never had enough to plan for the future. When my parents got older and couldn’t work as hard, they had nothing. They couldn’t retire. I don’t want to be like my parents.”

One wants to spend now. The other wants to save for later. They are stuck in financial gridlock.

Dr. Gottman looked at the kids and asked, “What should this mom and dad do?”

A hand shot up. “Save some and spend some.” The other kids looked at each other and agreed.

The 8-year-old believed that the couple should work out a compromise with each other. The best option would be to work hard for a while, put some of the extra money in savings, and use the rest of it to enjoy life so they don’t end up like Uncle Jack.

That’s all it takes. Kids are totally logical.

So what’s wrong with us adults? Why do we struggle with money when an 8-year-old knows what’s best?

Money Isn’t About Money

Money, to a degree, defines us. It determines how we dress. How we eat. What social groups we join. Whether we like it or not, money influences what we can and cannot do with our lives. So where does all this start?

Out of all the forces that determine our relationship with money, the most influential is our personal history – the melting pot of our childhood, teenage, and adult experiences that have sculpted and re-sculpted our likes and dislikes about money throughout our lives.

Our unique experiences come together to form what Dr. Gottman calls our Money Map.

We spend our lives swimming in a sea of moments that sculpt our financial dreams and fears. Maybe it was your father’s gambling problem, or your mother’s uptight way of controlling the household finances. Maybe it was your sister’s expensive interest in riding horses. Maybe it was your wealthy uncle who had a nine car garage, leaving you to feel like you couldn’t measure up.

These, along with thousands of other moments, create our individual beliefs about money.

Money Maps, like Love Maps, are often subtle and difficult to read. You may have grown up with an alcoholic mother who spent food money on liquor, making your meals unpredictable, so you made a promise to yourself that high-quality, expensive food was more important than saving for retirement. Or maybe you were picked on by kids in school for the way you dressed, so you spent all of your savings on custom tailored suits and ate Mac and Cheese every night so you wouldn’t get made fun of.

It’s these personal meanings that guide how we deal with money in our marriage. Logic has very little to do with it.

So when your partner complains about the expensive organic groceries you bought at Whole Foods, or the silk tie that costs more than a plane ticket, an argument breaks out, to you it’s not just food or a tie. These privileges represent stability and success. They protect you. They define you.

Money is loaded with power and meaning that can make can discussions heated and hurtful. Arguments about money aren’t about money. They are about our dreams, our fears, and our inadequacies.

What 8-year-olds don’t understand is that the key to managing conflict about money is to not focus on how much something costs. Instead, it’s to go beneath the dollar value to explore what money really means to each person in the relationship.

To move past these arguments, you need to use conflict about finances to understand how your partner came to be that way. Work together with this new understanding of each other to create shared meaning around money that brings you closer, rather than pushes you apart.

Originally published by Kyle Benson.

Our Top 5 things to think about before the 31st of March

End Of Financial Year (EOFY) is just around the corner, so start reassessing where you are financially and where you want to be. Here’s five things you can do.

Bring your debts together and pay less
Consolidating debt involves simplifying many little debts into one loan. A single loan means less juggling; account fee savings; and likely, less interest overall. Leave it with me.

Think about those tax deductions
If you’re an investor, include any payments you’ve outlayed on your rental property for repairs or maintenance. You can also claim depreciation or wear and tear on certain items against your taxable income such as buildings.

Prepare for the unexpected
Insurance documents yellowing in a drawer somewhere? It’s time to pull them out and make sure you and your family have the right cover to pay your loan, if something unexpected was to happen (accident, job loss or death). We partner with Insurance Market who is an expert in this area and can help get you the cover you need.

Make sure your loan is working for you
Refinancing means moving from one loan to another and choosing a better way to pay off your loans. If you haven’t looked at your loan for a while, or your financial goals have changed recently, let me know. With access to over 20 lenders, I will look at what else is out there and find the right loan to suit your needs.

Get ahead on your mortgage repayments
If you want to get savvy with your loan, set up a transfer for an extra $25 per week on top of your loan payment to get ahead. You’ll be surprised how much it helps. On an average loan of $400,000 you could look at reducing the overall amount you pay over the life of a 30 year loan by $59,905!* Not bad!

If you have any questions about my tips, let me know. I’m always here to help.

*Calculations are based on a principle and interest loan of $400,000 at 6.00%p.a. rate for 30 years. It may not include all fees and charges and the impact of additional or increased payments.

Bank or Mortgage Advisor?

Bank or mortgage adviser? Who should help you with your loan?

Getting a competitive, hassle-free loan on your own isn’t easy, so do you go with your bank or a mortgage adviser?

According to Rod Severn, from the Professional Advisers Association, advisers arrange about 40% of mortgages. And Kiwi’s are happy with their service with a Consumer Magazine survey finding the majority of those who’d used an adviser in the past five years were very happy.

Advisers have the time and financial knowledge we wish we all had. And, because they’re paid by your lender, you’re never out of pocket. Here are a few other reasons why it’s good to chat to an adviser:

  • you get a wider range of choices

  • they drive competition between banks and lenders

  • they bring you the help you need, when and where you need it

  • they help you navigate the complex home loan process from application to settlement and everything in-between

Want to know more? Talk to us and we’ll sort you out. 

6 Tips to Help You Save

These 6 Tips apply to first time buyers and anyone wanting to buy additional property! 🏡🏡🏡

➡️ 1. Make a budget: jump online or talk to an Advisor (that's US) about what your affordability looks like in terms of loan size. Then assess your income vs expenses to figure out how much you need to save for the deposit.

➡️ 2. Stick to your aforementioned savings goal and budget! We found apps like PocketSmith super helpful when we were saving -

➡️ 3. Sort your personal debts out. Banks are far more likely to loan you $100,000s of dollars if you have little to no short term consumer debt. If you have any debt with collections agencies pay this off first and ASAP. If you have other short term debt consider consolidating it into one loan (we can help you with this also) and make sure you are consistent with your payments to show the bank you can address and handle debt.

➡️ 4. See what help you can get - do you qualify for any grants? Kiwisaver withdrawals? Do you have parents who maybe able to gift you some funds? Or if you currently own a house do you have equity you can access?

➡️ 5. Start now! Best times to start saving was years ago or NOW!

➡️ 6. Look at non bank lenders who may have different criteria to your traditional banks.

➡️ Bonus tip - speak to an unbiased expert A.K.A a Mortgage Advisor 👋👋👋 


The Loan Process Explained - How an Advisor can help

How an Advisor Can Help

The role of a mortgage adviser is to make the home loan process as smooth as possible for someone wanting to buy a property. When wanting to secure finance, it’s hard to know where to start. An adviser can help guide you through the process and provide you with information and support to help you make the right decision when it comes to your loan.


A chat with your adviser

Here you’ll nut out your goals, your current financial position, and your borrowing power – to narrow down the kind of loans you’re after.


Understand what’s possible

Your adviser will present a few loan options to you. You choose one, then they get to work – preparing and submitting your loan application to your chosen lender.


Getting the go-ahead (pre-approval)

If all goes well, within a few days you’ll get the green light to borrow a set amount for a set time (usually valid for three months). This gives you a clear idea of what you can spend - and everything you need to make an offer on a property.


Finalising the loan (formal approval)

You’ve made an offer on the property and now it has been accepted. All that’s left is the paperwork which an adviser will assist you with. During this part of the process, your property will be accepted by the bank, the details of your valuation and insurance will be provided, and a settlement day will be scheduled.


Settlement - The big day

In this final stage, your adviser will coordinate the lead-up to settlement with your solicitor. Documents are signed to say you officially own the property and the funds from the bank or lender are transferred to the seller. Then you get the keys. Time to celebrate - the property is now yours!


After settlement

The role of an adviser doesn’t just stop there. Loan products and rates are changing all the time, so your adviser will be in touch at least once a year to make sure the loan that was originally set up for you is still competitive and is assisting you in achieving your financial goals.

A Positive First Home Buyers Story

A Positive First Home Buyers Story

Madison and Kelsey - Christchurch First Home Buyers

We’ve all been reading about it, it’s hard to escape the stories. “First home buyers are being pushed out of the market”, “Generation Rent”, “Housing Crisis”, “Millenials eating too much avo on toast”… it’s getting a bit boring. We recognise that most definitely in Auckland, housing prices have got out of control, and yes incomes have not kept up with the trend in rising living costs. Surely it is not all doom and gloom out there. There are still first home buyers getting onto the property ladder and yes some of our generation might be doomed to rent if they have to live in highly developed Urban areas like Auckland. So what about the people that are choosing a different path?

We recently sat down with some ‘millenial’ clients of ours to speak to them about their experience of buying their first home. What they told us surprised us and inspired us. We hope their story serves some hope to our generation and younger that it is still achievable to own your own home and you might even be able to eat avocado on toast at a café every now and then!

First up, it’s worth noting that this young couple, Madison and Kelsey, purchased their first home in September this year. They had a healthy 20% deposit and used their own savings, kiwisaver funds and the home start grant to make up this deposit. They did not rely on a guarantee from their parents or a gifted deposit. It was hard work and a great attitude that meant they could buy their first home at 26. This is no mean feat considering that both of them had taken time out to study after finishing high school, Madison to gain his degree at Canterbury (3 years) and Kelsey also partook in part time study. Being astute and hardworking meant both of them worked through their studies but also came out with student loans albeit smaller due to the fact that they had chosen to work part time.

Their first step in the journey to buy their first home was to jump online to a mortgage calculator and check to see how much they could potentially borrow, they were surprised to realise they would be able to lend up to $550,000 to buy their first home, and not only that as first time buyers that would mean they could borrow to 90% of the purchase price.  This kind of approval would have meant they could have purchased a brand new house easily.  What they told us next surprised us.

After opening homing through some new subdivisions in Christchurch they realised they wanted their first home to be just that, their first home. Not a dream home, not a brand new home but something that they could add value to, increase their equity in and easily manage the mortgage repayments on a shorter 20 year term. They wanted a great start, a stepping stone to their dream home in the future.

They changed tact with their open home strategy and started looking in areas that were not yet out of their reach in terms of price and had the potential to increase in value as the city continues to rebuild.  After walking through over 40 open homes, making offers which didn’t get accepted, they finally settled on a great property in a solid suburb with plenty of room for growth and development.

What we found so refreshing about working with Madison and Kelsey, was their realism and attitude towards their first home. They knew their first home wasn’t going to be perfect and have everything they wanted but it was going to be an investment in their future. Not rushing the process and taking the time to talk to experts who could give them qualified advice meant they have now created an amazing foundation upon which to build their life from.

Sometimes, sacrifice now and a delay in gratification will mean long term, you get better rewards and results. We take our hats off to these two who are great role models for the next generation of home owners. 

If you are a first home buyer and are not sure where to start, you can give us a call anytime or shcedule a free 15min chat to see what you might need to do in order to get started with your proeprty ladder dreams today. 

Get your free 15min chat now, it could be the most valuable 15mins you spend on yourself this year!


Be Prepared For Auction Day

For both buyers and sellers, an auction can be a stressful occasion. It can move so quickly that you don’t fully register what is happening until afterwards. For potential buyers, this can mean getting swept up in the drama and bidding more than you can afford. 

To stay grounded on the day, there are several things you should do ahead of time. The first is to speak with a mortgage adviser (that's us! ;-) ) early in the process. We will be able to give you expert advice on what to expect, how to work out your budget and help arrange a pre-approval.

Having a pre-approval will give you an edge against other buyers who may not. While it doesn’t necessarily guarantee that you’ll get a loan, it shows that you’re committed to purchasing a property. Also just knowing you’ve taken that initial step in the loan process can boost your confidence—and when you’re competing against a crowd of other bidders, confidence comes in handy. We can also arrange your finance so that you can bid confidently at auction with a pre-approval for that exact property. With enough time we can apply for the property to be accepted as 'security' ahead of the auction so you know you can bid up to your pre-approved amount with certainty. 

To further stand out among the crowd, you’ll want to be calm and composed. Auctions can seem intimidating if you’re not used to them, so do your research and ask family and friends about their experiences bidding so you know what to expect. Hannah remembers the first auction she attended (Brent was playing cricket so couldn't be there), the property sold for $40K over our budget and let's just say it ended in a lot of tears as we didn't get the house.  Attend auctions to get a handle on how they work. There are many articles online with tips from top auctioneers (like familiarising yourself with the auctioneer’s style) and the dispelling of strategies (such as holding back throughout the bidding). This knowledge can help you feel more assertive on the day.

Lastly and most crucially, make sure your budget is established (which we as your adviser can assist you with). Stay up to date with market rates to try to figure out how much the property could go for. Decide both on what you’d like to pay for it and how much you’d feel comfortable going up to if need be. Identify what your price limit will be.

It’s important that you put boundaries in place to make sure you don’t go over your limit. Even the most sensible person can get disorientated by an auction’s high stakes drama and sense of urgency, but once that adrenaline dissipates, you could be left feeling anxious about having committed more than you can afford. Having a buyer’s advocate or family or friends there with you can help you stay on track and avoid getting in over your head.

Whether you secure the home of your dreams at your first auction or become a regular fixture at a few auctions, being prepared will put you in a good position to make the most out of this fast-paced event. Get in touch if you would like to learn more or have a chat about getting pre-approved. 

Why 2017 will see more people using a mortgage adviser

2016 was an outstanding year for the mortgage industry with interest rates hitting an all-time low, making it a labyrinth for New Zealanders to borrow. Constant changes to lending have been a contributing factor to why more and more people are using a mortgage adviser when it comes to purchasing real estate. You want someone who can help maximise your chances of securing the property you're after with minimal work involved. With so many different options out there, why are mortgage adviser services now more sought out than ever?

We do the leg-work

Being in the market for property can be an overwhelming experience at the best of times, and having someone do all the research, negotiation and working out the nitty-gritty of the paper work can make a world of difference. In fact, for most, that is all the difference. Having an adviser do the groundwork will both facilitate the process and save the time that most of us don’t have, these days.

Using a mortgage adviser, means having an expert who is familiar with the market and because they know what each lender looks for [and doesn’t], are in a position to give the borrower a more tailored solution to their circumstances and needs. We know the ins and outs better than anyone as we are doing this stuff on a daily basis with multiple banks and lenders.

The relationship

The relationship with a mortgage adviser is a long-term one. Long after the exchange of documents and settlement, we are still there to support, answer questions or even assist with another property. Because purchasing real estate is a long-term investment, it’s important to know that there’s a trusted adviser right there, all the way.

Ultimately, a mortgage expert is there to provide unbiased advice, independent of any bank or financial institution. Our role is to educate and always have you, the customer’s, best interests first.