Occasionally life will throw you a curveball that directly or indirectly impacts your finances: you’re made redundant, your furnace dies or you’re expecting a child and you realise you’ll need to upgrade homes in the not-too-distant future.

The last thing you want is to dig yourself into a deeper hole because you weren’t able to manage the financial side of things.

Here are some ways to avoid that, so that you can bounce back sooner rather than later.

1.  Put your spending on lockdown.

The first thing to do is to stop spending more than is necessary. Some of the easiest ways to do that without disrupting your lifestyle too much include:

• Cancelling any unnecessary subscriptions. With so many online providers charging a subscription fee these days, there are bound to be some you can cancel or temporarily shut off. Keep the Netflix subscription if you love movies or the Spotify subscription if you love music, but nix the rest if you can.
• Cutting back on the luxuries. Temporarily swapping a movie night in for a night at the cinema or swapping organic groceries for the non-organic kind can save you some money without disrupting your lifestyle too much.

2.  Review your budget (or create one for the first time).

We’re big proponents of creating a budget so if you haven’t created one yet, now’s the time to get onto it.

Even if you already have a budget in place, now’s a good time to revisit it.

If there’s anything this situation can teach you, it’s that your financial situation doesn’t stay the same forever. Pull your budget back out for a re-review and see if there is anywhere else you can cut back.

3.  Check your financial institutions’ financial hardships policies.

If you’re having a hard time making ends meet even after tightening your belt, you may want to reach out to your bank, lenders, utility companies and anyone else you owe money to.

They’ll often have financial hardship policies that will temporarily halt your payments or reduce them, so that you can continue to meet your obligations and avoid late fees and defaults. After all, the last thing you want to do is make a difficult situation worse by going even deeper into unnecessary debt.

4.  Cash out your rewards points.

If you have any rewards programs like frequent flyer points or credit card rewards , you may have the option to convert your points to cash or use them like cash toward your next credit card payment.

Using points for cash usually doesn’t go as far as using them toward merchandise or flights, but it may be worth it if you need to “buy” yourself another month or two.

5.  Make minimum payments where it makes sense.

When life throws you a financial curveball, it often makes sense to hang onto as much cash as possible so that you can pay any additional unexpected bills that crop up. For example, if your best friend (aka, your dog) has emergency surgery, you’ll probably want some cash handy for any unexpected prescriptions during the recovery phase.

That means it might make sense to reduce loan payments to the minimum due so that you don’t find yourself back to square one when yet another bill comes knocking.

6. Get help

If you find that your financial situation is more than you can handle alone, there are various not-for-profit organisations that can help wherever you are in New Zealand. These include FinCap and the Citizen’s Advice Bureau.

Stay strong

We all experience situations that test our finances at one time or another – often multiple times throughout our lives. The key is to take strong action to keep the financial hit from spiraling out of control.

And if you do find that such situations test your mettle a little too much, it’s never too late to start thinking about a curveball account (perhaps better known as an emergency fund). This is a savings account specifically set up to help you through times like this.

That way next time, it’ll be just that little bit easier.

The information in this blog post is general in nature and does not constitute personal financial or professional advice. It is not intended to address the circumstances of any particular individual. We do not guarantee the accuracy and completeness of the information and you should not rely on it. Before making any decisions, it is important for you to consider your personal situation, make independent enquiries and seek appropriate tax, legal and other professional advice.

You don’t get much in this life unless you ask. That’s definitely the case with your bank, your insurance company and utility companies. There’s a lot of money to be made there. And if we’re lazy, companies can maximise their profits.

Don’t let that be you. By playing hard to get (that’s shopping around for a better rate), you can have your loyalty rewarded.

Understand your spending

Before you storm into your bank or phone your insurance company, take time to work out how much you’re spending now and the number and nature of the units/calls/fees that go to make up your bill.

Perhaps you’re making numerous nationwide phone calls or eating up too many megabytes a month on your broadband plan and a prepay deal could save you heaps.

Compare and contrast

Once you know what you’re spending a month, how many kilowatts of energy you use, what the interest rate is on your savings and all the other data, you can get your mouse out and compare your current deal.

Shopping around is made easy with comparison sites. Or you can open a spreadsheet or get good old fashioned pen and paper out to do the comparison.  

If there’s a new kid in town that’s advertising everywhere consider calling, or getting a quote online and see if you could do better. Sometimes their deals simply can’t be beaten.  

Ask for a better deal

Now it’s time to pick up the phone and call your provider to see what they can do to keep your loyalty. “Can you give me a discount?” or “that’s too expensive” are very powerful words in the English language. Remember it costs them a lot more to gain a new customer than keep you. So try your luck.

There’s one really important rule when playing this game: that’s never be rude if you want a better deal. Call centre staff are human and will be motivated to help you if you’re polite.  

If the call centre operator doesn’t have the authority to give you a discount as if the supervisor has the discretion to give you a discount?” you might just be successful.

Find out if there are other ways to save

If your existing supplier can’t or won’t give you a discount, then move onto Plan B. That’s asking them for other ways to cut your bill.

These companies release new plans and accounts all the time and they can analyse your existing spending and find the best deal for your personal circumstances.

It may be that there’s a new bank account available with reduced fees or your accounts can be reorganised to stop you being pinged with honour and dishonour fees.

Be careful, however, that you read and understand the fine print. Does the new insurance policy you’re being offered have the same cover as the last or are you agreeing to a new fixed term contract that you can’t break?

If all else fails: walk

Sometimes you just need to vote with your feet. If the opposition is offering a better deal and you’re sure you’re comparing apples with apples, then move.  Hopefully your new supplier will value your new-found loyalty.

Do it all again

If you really want to win at this game, make a diary note to do it all again in 12 or 18 months time. Chances are there are better deals around again.

The information in this blog post is general in nature and does not constitute personal financial or professional advice. It is not intended to address the circumstances of any particular individual. We do not guarantee the accuracy and completeness of the information and you should not rely on it. Before making any decisions, it is important for you to consider your personal situation, make independent enquiries and seek appropriate tax, legal and other professional advice.