Resource: Budgeting for Families

 

Living in New Zealand can be a very different experience for lots of Pacific families when compared to living in the Islands, such as coming from having your own land and home in the Pacific to renting in New Zealand, finding a job and having to pay rent and bills; eating from the land to buying groceries, paying for water, and always having family around to help with the children to depending on day care.

 

Budgeting is important so that you can know where your money is being spent; you can keep up with your bills and pay debts quicker, save for the things you want or for a rainy day, reach your financial goals and manage your money wisely.

Everyone can budget and Fonua Ola provides a budgeting service to those requiring help. Budgeting is about planning your spending to fit your income and getting control of your finances. It is a useful tool to help you manage your money and think about the financial choices you make.

 

Prioritising your income

Budgeting is based on prioritising your income, by working out your needs, wants and luxury items. Top needs are food, rent and power as we need those to live. We also need clothes and transport. You should pay for these first and then any bills, debts and loans. Buying to impress others is not a good way to live.

 

Goal setting

Setting financial goals helps you to focus on what you want to achieve financially, whether it is paying off debts, saving for a trip overseas or being disciplined in your spending.

 

How to complete a budget

There are seven basic steps to completing a weekly budget.

  1. Determine your income (weekly, net after tax) – include your pay or benefit and any family tax credit you receive

  2. Determine your weekly expenses such as transport

  3. Determine your monthly expenses such as your power bill, then work out what they are weekly by multiplying the monthly expense by 12 (months) then dividing by 52 (weeks)

  4. Determine annual expenses such as insurance, then change these to weekly by dividing the annual amount by 52

  5. Determine total weekly expenses by adding up the answers from steps 2 – 4

  6. Determine allowances

  7. Determine total weekly surplus or deficit by taking your total income, subtracting the total expenses + allowances = the money left over (surplus) or the money overspent (deficit)

 

How can you improve your weekly budget?
  • Negotiate lower car payments

  • Use less power e.g. turn off switches, short showers, not use the dryer

  • Check your WINZ entitlements e.g. funeral, food grants, advances for school fees, uniforms

  • Disconnect internet and use the library’s free internet

  • Find jobs

  • Older children could do a paper run after school

  • Shop at the supermarket

  • Give up smoking

 

Need more help with budgeting?

If you would like to do budgeting with a Fonua Ola Budget Adviser please contact us:

Phone: 09 270 2089

Email: info@fonuaola.org.nz