New year, new finances? Money tips to set yourself up for success in 2024

For most of us, the start of a fresh new year is the ideal time to think about what we want to achieve over the next 12 months. And it doesn’t have to be all about punishing gym routines or diet dos and don’ts. Financial goals can be just as transformative as lifestyle ones, and even the smallest of steps can be a boost toward future money success.  

Whatever your age or life stage, we've got a range of money and investing tips to help you stay in top financial shape in 2024.  

• Wealth accumulation and retirement
  When you’ve reached the stage of life where preparation for retirement is your most important money goal, these are tips on changes to make now to make the most, financially, of the next few years.  
• First home buyers and families 
  If you’re in the thick of it working towards buying your first home or raising a family, you probably feel like financial pressures are coming from everywhere. These tips are for you.  
• New Graduates
  As you start out on your career journey, there are a few things you can do right now that could be the most important and positive financial decisions of your life. If this is you, read this section.  
• Students
  Just staying afloat financially is probably your number one priority if you’re a student, which is why now is the best time to start practising good money habits. Read this section for tips on what you can do. 

Wealth accumulation and retirement

By this stage of life, you probably have most of your financial ducks in a row. But there might be a few things to think about and adjust this year.  

Prioritise the mortgage 

We’re currently going through a period of higher interest rates, which may mean the interest rate you’re paying on debt could be higher than the long-term expected returns from your investments. If that’s the case, then it might make sense to prioritise paying down the mortgage before adding to your investments. If your mortgage comes up for renewal this year, it might be a good time to consider if you are able to increase repayments to pay it off faster.  

Don’t simply ‘set and forget’ 

Have you thought about giving all your finances a thorough review this year? As life changes, your financial goals and strategies do too. Maybe it’s time to revise your insurance needs, KiwiSaver scheme fund and contribution rate, investment contributions and savings goals.  

If you’re a MAS Member, you can access our nationwide network of MAS Advisers at any time, for no extra cost. MAS Advisers can assist with a range of financial advice tailored to your needs, phone 0800 800 627 or email info@mas.co.nz.  

Investing in retirement 

While many think hitting retirement is a time to switch to a completely conservative investing strategy, maintaining some exposure to growth assets in retirement can be beneficial too. With the median lifespan for a 65-year-old in New Zealand around 87 years for men and 90 years for women, your retirement could be around 25 years long. Exposure to growth assets can help you achieve higher expected returns over time to stretch your savings further. A MAS Adviser can help you understand your investment timeframe and attitude to risk to help you determine the right mix of growth and income assets. 

First home buyers and families

This stage of life is all about taking steps towards building future wealth and providing financial security for loved ones. It’s also a time when a lot of people go through their most stressful financial years.  

Get clear on your money goals 

Having financial goals will help you to stay focused and understand your investment timeframe, which is critical to many important investment decisions.  

For many, their first investment account is in a KiwiSaver scheme, which can be used to buy a first home, or for retirement. If you’re 30 and planning to use KiwiSaver savings to buy your first home at 35, your investment time frame is 5 years. If you’re 40 and already own a home, the focus of your KiwiSaver investment will be retirement, so your investment time frame is at least 25 years.  

If your investment time frame is less than 5 years, consider a more conservative KiwiSaver scheme fund to shield your savings nest egg from ups and downs. If your time frame is 5 to 10 years, consider a balanced fund, and if it’s more than 10 years, consider a growth or aggressive fund in a KiwiSaver scheme. 

Whether your money goals this year include boosting your home deposit, increasing your investments, or bulking up your emergency fund or savings, think about the acronym SMART – make your money resolutions specific, measurable, achievable, relevant, and time-bound.   

Maximise your deposit 

Chipping away at a deposit for your first home can feel like a never-ending struggle, so it makes sense to maximise all the extra help you can get to hit your goal faster. You may be eligible for a First Home Grant from the Government if you meet a range of criteria like earning below a certain income cap, contributing regularly to your KiwiSaver account for at least 3 years, and have a deposit of at least 5% of the purchase price of the house you want to buy or build. With the First Home Grant, you could receive a boost of up to $5,000 towards buying an existing property, and up to $10,000 towards buying land to build a home or purchasing a newly built home.   

Protect yourself and your family with the right insurance 

Throughout New Zealand, research has found underinsurance is a common problem. As recent high rates of inflation mean the cost of replacing belongings or rebuilding your home has risen too, many more Kiwis could be underinsured without realising it. If it’s been more than 12 months since you last reviewed your insurance policies, it’s worth checking to ensure you have the right level of cover.  

Beyond insuring your house, contents and car, it’s important to make sure your family is taken care of should anything happen to you. Having Life Insurance means your loved ones are looked after financially if you die, and Income Security Insurance allows you to be paid a weekly benefit if you are unable to work due to sickness or injury. 

Unsure whether you have the right level of insurance cover? MAS Advisers can assist with a range of financial advice tailored to your needs, phone 0800 800 627 or email info@mas.co.nz.  

New graduates

Starting out in your first job is the time for establishing a strong foundation to build your financial future.  

Develop an emergency fund 

Unexpected costs are a part of life, and having a financial safety net gives you peace of mind and takes a lot of the stress out of navigating money challenges. Everyone’s financial needs are different, but as a starting point, aim to save at least 3 months’ worth of living expenses.  

Pay yourself first and automate your cash 

Rather than frittering away every last cent when your first pay packets start rolling in, create good money habits from the beginning by setting aside some funds for saving or investing. Think of it as paying yourself first – put some money (even just a small amount) aside as soon as your salary lands in your account. It can be hard to rely on willpower alone, so set up an automatic payment to help you stick with it.

Pay down debt 

While the cost of living is challenging for everyone right now and you’re just at the beginning of your earning potential, you shouldn’t ignore high interest debts. Personal loans or credit card debts can seriously undermine your financial security, so prioritise paying them off as soon as you can.    

Students

Few of us are financially flush while studying, but the student days are the ideal time to learn the basics of money management, while establishing financial independence.  

Find a money tool that works for you 

Budgets aren’t for everyone, but they don’t have to be all about restriction and misery. They can be an invaluable tool to help you get crystal clear on your current financial status, and a place to track your income from part-time jobs or allowances against your expenses. Apps like PocketSmith and Spendee can help, or try the Budget Planner tool from Sorted. 

If you can, start saving a portion of your income, however small. It's not just about the amount, but developing the habit. 

Sign up for KiwiSaver 

If you’ve got a part-time job while studying, getting into KiwiSaver as early as you can gives you more opportunity to grow your wealth for the future. It’s up to you whether you contribute 3, 4, 6, 8, or 10% of your gross salary or wages into your chosen fund, and your employer is required to match up to 3% of your personal contributions.  

As a further sweetener, KiwiSaver members can also receive a government contribution of up to $521.43 per year towards their account. To access the free money, you need to meet certain eligibility criteria, including personally contributing a minimum of $1,042.86 by 30 June every year.   

The MAS KiwiSaver Scheme offers 7 different investment funds to suit your individual needs. The MAS KiwiSaver Scheme follows our responsible investing policy, and MAS profits help to fund health equity initiatives in New Zealand communities.  

Keep learning 

With a range of online tools, books and podcasts, it’s never been easier to access information about managing finances and investing. If you’re new to investing, use Sorted’s investor tool to help you understand some investment basics, and whether your individual risk appetite is better suited to growth assets like shares, or income assets like bonds.  

Seek expert advice 

MAS Student Advisers are on hand to talk through your money queries and financial goals, and help you sort out a tailored insurance and KiwiSaver account as you step into working life. You can meet for a relaxed, no-obligation chat with a MAS Student Adviser in person, via video chat or by phone.