How to manage your personal finance amidst a pandemic

2021 started with such optimism — it was going to be different to its pandemic-afflicted predecessor. The country was COVID-free, a vaccine was on its way and a return to normality was just around the corner.

But we all know how that went — the Delta variant had other ideas. So, if you’ve reached the end of the year feeling tired but without much progress to show for it, odds are you’re not alone.

We’re now wise enough not to count on next year being COVID-free, but now’s also the time to find ways to improve your progress on the financial front. In fact, it’s something you should be prioritising amid ongoing uncertainty. Here are four quick tips to get you started.

Where to start?

Lots of things have changed amid COVID-19 — interest rates hit record lows but are now rising, the share market plunged then rebounded, and new investment property tax rules were introduced. One of the first things to put on your financial ‘to-do’ list is to review where you’ve invested your money. That includes investment properties — are they still fit for purpose following the regulatory changes? Managed funds and KiwiSaver — their performance, fees, and your investment settings. What do you owe? What’s the interest rate, ownership, and debt structure? Basically, an annual performance review to ensure your money is working as hard as it can be.

Systems win where willpower fails

Daily life taxes our willpower, so creating systems to make it easy to stick to your plan is essential. It could be setting up a separate food account, so you know when you’re overspending; establishing direct debits so you always get the prompt payment discount; or even downloading a parking app so you never get stung by parking tickets.

Track your progress

Getting ahead starts with working out where you’re heading! Then, break it down into smaller steps so that you can measure your progress towards the chunkier goals. Nothing motivates you more effectively than seeing results.

Optimise to maximise

People hungry for a great investment return often overlook the risk-free gains to be made by optimising their situation. We tend to squander 15% of our incomes on things that don’t make us any happier — outdated insurance policies, credit card interest or inefficient mortgage structures — identifying and retaining those funds presents a huge opportunity to put that money to good work.

Hannah McQueen

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