Over the 16 years I have lived here I have always found early autumn to be a great time in Rotorua. The days are still long and warm and if you have or know of someone who has fruit trees, the summer fruits are at their ripest and most delicious and usually available to those who ask nicely and respect the property of the owner. Remember, it is their right to say ‘no’ if they prefer to keep the fruit for themselves, especially if they have spent significant time weeding, fertilising, and nurturing their fruit trees. However March does tend to be a month full of changes. Personal taxes are being sorted in anticipation of the end of the tax year, Easter is upon us once again and we turn back the clock on daylight saving in early April. It is a time when we all need to make decisions and to make consistently good decisions we need to be organised.
Being organised is at the very heart of budgeting and as anyone will tell you the heart of being organised is planning. Ideally, our past income earning and spending patterns provide a basis for planning into the future and this is further adjusted for expected future events. The probability that these future events will happen are dictated by decisions we make now or expect to make sometime in the future. That’s the simple version of budgeting.
Unfortunately, things get complicated when trying to sort out the negative impacts of past overspending or debts. Budgeting solutions usually involve either increasing income or reducing spending while advocating with creditors to either reduce the debt or arrange more favourable repayments over a longer period of time. Sometimes after exploring all options there is no budgeting solution and all you have is a range of legal (eg. cancellation of debt contracts) and/or insolvency options ranging from a Summary Instalment Order (SIO) to full Bankruptcy. These insolvency solutions shouldn’t be seen as the end of the world but should be viewed as educational on what not to do once you have met your repayment responsibilities or had your bankruptcy discharged. This can be really difficult to deal with emotionally.
At the budget service we agree with doctors that prevention is better than cure and that is why I think March is a great time to take stock of where you are at financially and get some advice if you feel it will help.