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1. Know your net worth (the difference between what you own and what you owe) and set goals to increase it.
2. Draw up a budget and stick to it. You should spend less than you earn, so cut costs and/or find ways to increase your income, rather than borrowing to pay bills or to pay for consumer items.
3. Borrow only what you need, and know the true cost of your debts e.g. interest payments can greatly increase the total cost of a purchase.
4. Pay off debt - your high interest debts first, like credit cards and hire purchase. Repay your mortgage as fast as you can, and you'll end up paying thousands of dollars less overall.
5. Save for an emergency fund or 'cash cushion' of 2-3 month's income (this is worth doing even if you're paying off a mortgage, but not if you've got high interest debt). This will help cover you if the car breaks down, or you lose your job.
6. Once you've paid off your high interest debts, start regular saving for the short term (a deposit, a holiday, a lump sum to invest).
7. Protect your assets - buy the right amount of insurance, make a will, and see if a trust is right for you.
8. Make a financial plan for retirement - if you have access to a workplace savings scheme consider it seriously (even if you still have debt), especially if your employer will make a contribution too.
9. Consider investing to make your money work for you - it isn't just for rich people!
10. Teach your kids about money - the earlier they learn, the better they will be at making their own financial decisions

for more information visit www.sorted.org.nz

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