Fuel, food, rent and power all cost more than they did a few years ago, so if you're feeling a bit uneasy about money, you're not alone.
Knowing exactly where your money goes is one of the simplest ways to feel more in control.
For the latest figures, see cost of living in NZ: what's changing.
Tracking your spending shows you exactly where your money goes. That makes it easier to live within your income, spot costs you can cut, avoid unnecessary debt and save for the things that matter.
It also helps if you apply for a loan, because lenders need to understand your income and expenses before they lend.
Tracking your expenses can help you keep your spending in line with your income and avoid a budget blowout or unnecessary debt. How are you supposed to keep on top of price rises if you don’t know where your money is going? It’s also a good idea to set up a weekly or monthly budget that goes hand in hand with this – but more about this later.
If you find you need some financial assistance for an upcoming expense or to cover some unexpected costs, we may be able to help.
During the loan application process, all lenders providing consumer credit in New Zealand need to ensure they have a clear understanding of a borrower’s requirements and objectives. They must also assess a borrower’s income and expenses to ensure that the repayments required of any loan are not likely to cause substantial hardship to the borrower.
To do this, many lenders, such as Instant Finance, will require applicants to complete a budget of their finances and will need the last 3 months of bank statements. As responsible lenders, this check means that we won’t let you get in over your head with your repayments.
Knowing your spending makes the application smoother, and helps you and us work out what you can comfortably afford.
If you already have a loan with us, tracking your spending and having an accurate monthly budget can help you factor in all costs so that you’re able to meet your repayment requirements. As costs increase, it's a good idea to update your budget to make sure it’s realistic. Remember, if you’re finding it difficult to meet your agreed repayments, contact our friendly team and they’ll be glad to assist you.
So, we’ve talked about why you should keep track of your spending, but what about how?
There are lots of apps and tools out there that can help you keep track of your spending, but you can also do it with a trusty pen & paper. Here’s how we’d tackle it...
Make a list of all the categories of your spending each month; these might be:
Regular bills (rent, utilities, insurance)
Groceries
Takeaways/eating out
Clothes & footwear
Petrol and Transport
Loan repayments
Childcare & Education
Entertainment
Each week or month, go through your bank statement or receipts and categorise each purchase. Total up each category of spending.
Once you have the total for each category, you can review your spending and see where you’re doing well and where you could cut back on or reallocate your money.
Want a ready-made template? Download our free 50/30/20 weekly budget worksheet.
Budgeting, like tracking your expenses, can be done on paper, in a spreadsheet, on online accounts or in an app – our friends over at Sorted have some excellent templates too.
Here’s why budget setting is great to go hand-in-hand with tracking your expenses.
Try to spend less than what you earn – When you have a budget, it’s much easier to live within your means. Without one, you might not fully understand whether you're overspending, how much you’re overspending by, and what it’s costing you.
Work to reduce debt – A budget can help you see your essential and non-essential expenses. This can help you identify areas where you can cut back your spending and allocate that money to reduce your debt.
For a step-by-step plan, see our guide to debt management in NZ.
Set aside money for other goals – If you can, you can use budgeting to help you save money for a holiday, some new wheels or even a rainy-day fund.
Overspent over the holidays? Here's what to do if you've overspent at Christmas.
If you’ve completed your monthly budget and find you need some extra funds along the way, we’re always here to help! A personal loan can give you the helping hand you need. As a responsible lender, we will always make sure you can afford your loan repayments and can even help you create a budget to work out how much you can borrow and afford to pay back. Chat with our friendly team today about your financial situation and how we can help.
We know tracking your spending isn't as fun as a night on the couch or a day out with the kids, but it's one of the best habits you can build. A few minutes a week can help you get a step ahead.
It shows you exactly where your money goes, so you can live within your income, cut costs you don't need, avoid unnecessary debt and save for your goals.
List your spending categories (like bills, groceries, fuel, takeaways and loan repayments), then go through your bank statements or receipts each week or month and add up each category. You can use pen and paper, a spreadsheet or a budgeting app.
Yes. In New Zealand, lenders must check your income and expenses to make sure the repayments won't cause you substantial hardship. We ask for a budget and your last 3 months of bank statements.
