Chapter 5: The Spendy Saver gets promoted

03 July 2020

You’re back...fantastic! If you’re just tuning in now, here is a link to the first chapter.

Welcome back; this is my favourite part of my journey. We have started to build up our savings, and it’s really exciting to see the balance grow!

Graces FlowersThese are the gorgeous flowers my Mum sent to me at work to celebrate my promotion

So…. I got a promotion!! I’d been working towards this promotion for 2 years, and aside from being the role I had worked so hard for, it also came with a pay rise! I knew this would mean I could save more towards my first home goal (and I could have more money to spend on things rather than using my credit card, which I still had this at this time).

A positive impact

The first thing I did with my increased salary (after I had purchased myself a treat for getting my new job, of course!) was to increase my KiwiSaver contributions from 3% to 8%. This seemed easy to me as it was money that I didn’t have before my promotion, so I didn’t notice the extra money coming out of my pay. This was the perfect time for me to increase my contributions, and it was so easy. All I did was tell my work I wanted to increase my contributions from 3% to 8% and they actioned it before my next payday.

I know they say, “the more you earn the more you spend” so I made sure I reviewed my budget and altered my expenses if they had changed. I also gave myself a realistic amount of spending money. Jordy and I increased the amount we were saving each pay as this was still our priority.

As soon as I was paid, I would transfer my money into savings before I made any purchases. This way I knew I had covered all my commitments and the rest was mine to spend.

Grace4Buying a home now seemed more realistic...

Jordy and I sat down again and did some more research. 

We used an online calculator which gave us an estimated balance of what our KiwiSaver savings could look like in a few years – when we hoped to purchase a home. It also gave us an idea of how much we could borrow for a home loan against our incomes.

We decided to open a few more bank accounts and name them so that this made it easier to know what our savings were going towards. At one stage I remember having 13 different suffixes all named something different, e.g. house, spending, holidays & insurances!

We would set up automatic payments so that the money for insurance would go into the insurance account and be taken out automatically – without me having to worry or remember to pay it manually.

Small changes make a big difference

This part of my journey was really important because if I hadn’t increased my KiwiSaver contributions when I got my promotion, I wouldn’t have been in a place to afford a first home within 5 years of starting KiwiSaver. This small change made a huge impact on my future savings.

What kept us motivated and on track with our savings over the next couple of years was the buzz we got from checking in on our progress, and seeing our plans to buy our first home really start to take shape.

Join me next time to hear about how we got across the line with our first home!

Ciao! 😊

 

 Graces Blog Assets V10 09

 

Spendy Saver hack - Boost your KiwiSaver

One of the quickest ways to get your KiwiSaver savings moving is to increase your employee contributions. You can choose a contribution rate of 3%, 4%, 6%, 8% or 10% of your wages. It’s one of the easiest ways to really grow your KiwiSaver savings!

Read the next chapter in Grace's journey - Chapter 6: The Spendy Saver buys a house >