5158257_mLast week I entitled my MMM (Monday Money Motivator) – It’s not too late!

In it I gave you some tips on Christmas and holiday spending. I had some very favourable comments so it did seem to strike a chord with you.

 

In some ways “it’s not too late” could be the title for this week’s MMM too!

 

Two recent pieces of news attracted my attention.

  1. That credit card spending was going up … “Actual retail sales on electronic cards were up 7 percent to $6 billion in October from the same month a year earlier.” http://bit.ly/1iXID9F
  2.  There is a prediction that interest rates will rise http://bit.ly/1cgzkzg. Many commentators predict that this could be as high as 2%.

I must state again that I am not a financial advisor, but am talking about this because these two factors together could make huge a huge impact on people’s spending plans.

 

In the second article …“Mortgage broker Geoff Bawden calculates for every $100,000 borrowed, a 1% rise will add $64 to a weekly mortgage payment. “ It also said that the average mortgage in Auckland was $400,00, so for that “average” mortgage that would mean an additional $256 a WEEK that you would have to find. Monthly that would be $1109! That is for an increase of 1% … double that for 2%!! $2218. That is a lot of money to find in most of the spending plans ( budgets) I see.

 

I don’t bring these to your attention to scare you, but rather to persuade you to act now, especially if you are affected by both pieces ie you are using credit cards more than you did last year (especially if you are not able to pay them off every month) and your mortgage repayments may significantly increase next year.

 

Take these steps:-

  1. Stop using your credit cards now!! Revert to cash or debit/eftpos cards. Research shows that your spending on credit cards is likely to be about 20% more than it would on debit cards and that number is even higher when compared to cash! Then work very hard to get them paid off ASAP. If mortgage rates rise you can guarantee that so will the interest rates on credit cards!
  2. Relook at your spending plan for Christmas and the holidays and reduce the spending where possible.
  3. Get help now. Don’t leave it until you are in trouble; do what you can to prevent it happening. Remember that I offer a free chat over coffee. If time and or location make that impossible we can always have a virtual chat by phone of Skype!

Whatever you do, take action now and get yourself better prepared for what could come in the New Year! If the interest rates don’t rise think how much you could pay off your principal instead!!

 

I hope I haven’t put too much of a dampener on your Monday, but just know I am doing it with your best interests in mind! Please don’t bury your head in the sand; it will be that much easier if you act now!! You will feel much better if you are proactive.

If you have  a mortgage are you making any plans on how you might manage the increased interests rates? Is your mortgage on a fixed interest rate? Please share your thoughts below.

 

 

 

 

 

 

 

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October 7, 2013

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Two things are interesting me, in a money sense, this Monday morning.

The roll out of Ultra Fast Broadband (UFB) and a followup on an earlier topic, how much people spend on computer games, specifically Candy Crush!

Ten days ago the pavement / footpath outside our apartment building suddenly sprouted multicoloured chalk inscriptions and last Monday the arrival of jack hammers and lots of men in high res outfits confirmed suspicions; we are being wired ( is that even the right term for fibre cables?) for UFB. We now have lots of BIG holes with safety barricades around them.

I have no idea how long this process takes and what I have realised is that I really don’t know what the next steps are. I do know that it takes more than this process for me to have it here on my computer, but am I just going to be asked if I want to move up/ upgrade and who does that? Will all communications companies provide it? Do I need a new provider? On my first foray into answering these questions I didn’t find out but I must have asked a better question this time because I found out quite a lot more. At UFB.org.nz they publish a list of providers who “….have published prices in detail.”  OK so far, so good, but I’m not sure that I have all the facts and would like to talk to people who have already been connected. Have you connected and if so what are the real charges/costs? Please let me know and I will share next week.

Now to Candy Crush. You might remember that I wrote about the addictive nature of this game and how one gamer spent $380 on it. Anyway last week I heard a news report on how much the company, King.com, is making from this “free” game. You can play it for free but the addictive nature of it, encourages you to buy more moves or lives etc, so apparently it is now called a “freemium” game! In July King was reportedly making USD$633,000 a DAY!!! A month ago another report said that was now up to $850,000 a day!!  It is the most popular game on Facebook, Google and Apple and many millions play it daily…..obviously not all of them for free!! I could be in the wrong job!! Anyway, I reiterate my advice: be extremely cautious about spending “just $0.99” to get ahead in the game; those $0.99 add up to significant amounts of money.

Let me know your thoughts. Have you got onto UFB yet? If so how have you found it?

Come clean, do you play Candy Crush Saga and if so, do you purchase more turns or lives? How much do you think you have spent on it?