Tips to survive high interest rates

To effectively manage your finances and prepare for potential challenges, it is important to create a budget, plan ahead for changes in interest rates, and find ways to reduce expenses.

Some options for saving money may include being mindful of expenses when eating out or grocery shopping, selling assets that are no longer needed, and potentially reducing the number of vehicles. It is generally advisable to continue contributing to KiwiSaver, but taking a temporary break may be an option as a last resort. High-interest consumer finance options should be avoided as they can become a downward spiral. Consolidating high-interest debts into the mortgage can significantly reduce cash flow burn. If you are experiencing temporary hardship, your lender may be willing to consider a temporary interest-only period. If you are unable to meet mortgage commitments despite these efforts, there are options for hardship assistance available through your lender. While the next 18 months may be difficult due to rising interest rates, they are expected to eventually stabilize and potentially even decrease, so it may be helpful to think of this as a short-term challenge.

• Building a budget and identifying areas for cost cutting can be helpful in managing expenses.
• Plan ahead and consider the potential impact of rising interest rates on mortgage payments.
• Save money by being mindful of expenses, such as avoiding alcohol when eating out and being strategic about grocery shopping.
• Selling assets that are no longer needed or used can generate additional funds.
• Reducing the number of vehicles may save money in the long term by reducing costs such as insurance, maintenance, and fuel.
• It is generally advisable to continue contributing to KiwiSaver, but taking a temporary break may be an option as a last resort.
• High-interest consumer finance options should be avoided as they can become a downward spiral.
• Consolidating high-interest debts into the mortgage can significantly reduce cash flow burn.
• Temporary interest-only periods may be an option for those experiencing temporary hardship, but must be approved by the lender.
• If you are unable to meet mortgage commitments despite these efforts, there are options for hardship assistance available through your lender
• Consider selling assets or finding ways to reduce expenses, and be mindful of avoiding high-interest consumer finance options.
• While the next 18 months may be difficult due to rising interest rates, they are expected to eventually stabilize and potentially even decrease.

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