Financial expert reveals top tips for savings this year, urges Kiwis not to 'beat themselves up' over cost-of-living

A financial expert has revealed her top tips for Kiwis continuing to battle the cost-of-living crisis, including negotiating bank fees and power bills. 

Despite inflation continuing to ease, with data revealed last week showing New Zealand's consumer price index sitting below 5 percent for the first time since September 2021, the cost of everything is still soaring - and it’s hitting Kiwis in the pocket.     

BusinessDesk investment editor Frances Cook joined AM on Tuesday morning and reminded Kiwis the cost-of-living crisis is still "really, really hard out there". 

She urged people to not "beat themselves up over" it.   

Cook revealed to the AM hosts her secrets for any Kiwis who set finance and savings targets as their New Year's resolutions.

'Go through everything'

Cook's first top tip she revealed to AM was for people to go over a month of their bank statement. To make it easier, she urged Kiwis to sit down with a glass of wine or whatever will help "tempt you into feeling a little better" about it. 

"Go through everything. Nothing is locked in, nothing must stay there," she said.   

"Even the things that you think like bank fees, people often don't expect they can be negotiated. All these things can be negotiated.  

"Your power bill can be negotiated. Go through absolutely everything and see if you can find some sort of way to make it cheaper."  

In terms of bank fees, Cook urged people to call up their bank and negotiate a better deal.   

"If you can say, 'I've seen this other deal around or I've been a loyal customer for this many years, do you have a better account for me?' All these sorts of things that can often go," Cook told AM.  

For people's power bills, Cook urged them to go to the Powerswitch website, which is a free service where people can compare plans from power companies, so they can find the cheapest deal. 

Kiwisaver schemes   

Three-hundred-thousand New Zealanders are in a default KiwiSaver scheme and while Cook said they aren’t necessarily bad, people could be doing better.    

She said a lot of people just sign up to KiwiSaver, get put in a default scheme and they give it no further thought.     

Cook revealed if people change from a default scheme to a growth account it could "massively change your money".  

"When I first started learning about finance, I was in a default conservative account and it turned out I should have been in growth, and I checked what difference that would have made. No extra money from me and I would have about double the amount by retirement. "It's huge," she told AM.   

Cook also recommended using a tool like Sorted's KiwiSaver Fund Finder to get the best results.  

"[A] general rule of thumb, you don't want to have your money in growth if you need it within the next five years or so for first home or retirement, because the market goes up and down, that's part of how you make your money. That's a good thing, it's a feature, not a bug. "It feels horrible but it works. 

"But if it goes down right as you want to pull your money out for a house deposit, not great so you've got to have time."  

Watch the full interview above.