Money Penny

The Secret of Compounding Interest!

When it comes to compounding interest the earlier you start saving - the more you make.

Even saving a small amount of money each week, along with the benefit of compounding interest can really turn your savings into something extraordinary.

Sorted.org.nz says “The best compounding happens when any interest we earn gets reinvested and earns even more interest. It’s interest earning interest, and our money is working for us instead of us working for it!”

How does compounding interest work?

Let’s say you save $10 a week at an interest rate of 2.5% pa (after tax) - the Sorted website shows that after five years you would have saved $2,600, and earned an additional $170 in interest. And by continuing to save for 15 years (and increasing your weekly savings amount to take inflation into account) you would have saved $10,400, and earned an additional $3,050 in interest!

How can you calculate the amount you can achieve by regularly saving?

It’s easy - Sorted has a calculator that does all the maths for you. You can find it at sorted.org.nz/tools/savings-calculator

The great thing is that with the power of compounding interest even saving small amounts of money adds up over time. So don’t wait - start saving today!

Stay safe out there.

Talk soon...
Money Penny

Take Control of your debt

Throughout the Christmas and New Year period you can sometimes find yourself building up more debt than you expect. You may find that you have experienced a credit card blow out over the holiday period. Or, that the hire purchase you had on an initial interest free period is now going onto a high interest rate. With the festive season being traditionally more expensive, it makes sense to make a plan to get out of debt. Sorted.org.nz suggests you: Make a list of all your debts and the interest rate on each one. (Look up the interest rates in your loan agreements or credit card bill.)Identify which debt charges the highest interest.Make bigger repayments to pay off this debt faster. When it’s paid off, start paying more off the debt with the next highest interest rate. If you do find you need to borrow, do a bit of planning first. These are some of the things that you should consider when you are borrowing money: How much do you really need?Are there any fees or charges?How much is the interest?Will the time you pay it back over be a long period, meaning you pay more interest but have a lower repayment – or a short period, meaning less interest paid but higher repayments? The New Year is a great time to take care of your money matters and put yourself in control - so take the time now to consider your options, and take action! Stay safe out there. Talk soon . . . Money Penny

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Cyber Crime

Cyber Crime has become a constant and evolving threat to our everyday lives!

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Scams and more scams

Scams! They are happening all the time and when we least expect them. Recently the Financial Markets Authority (FMA) released a real life story about a chartered accountant who we will call ‘John’. Despite being an experienced investor, John was scammed of US$39,750 through a share scam.

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Be SMART with your money

Learning to be a regular saver is a giant leap towards having enough money for the things we want.

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What is Police Moneywise?

Police Moneywise is a financial capability course that is a joint initiative between Police and Families Credit Union and the NZ Police, which will initially provide free financial capability courses for all police employees, with participation being voluntary and free.

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To Invest, Or Not To Invest?

There are many different types of investments out there, and figuring out the best investments for you personally can be tricky.

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Debt Consolidation

As fun as the holidays are, they can sometimes bring a whole bunch of problems – family spats, long distance travel, and over indulgence with pavlova. Luckily, most of these problems can be solved with a bit of space, shared driving, and stretchy pants.

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