Izzie Brown and John Afua
They don’t have savings, and had to borrow $20,000 from a finance company to pay for the wedding, which was very large as John has many relatives.
Izzie spent two years in Samoa on Volunteer Service Abroad and John has until recently been supporting his extended family financially. Their priority is saving for a house deposit.
Issues for the family
The following section sets out some of the main issues for each of the families that would need to be discussed with a financial adviser and some of the possible solutions or options to be considered. Specific solutions would require much more detailed knowledge of each family’s finances as well as discussions about their goals and priorities. Even so, this shows just how many issues there are to be considered and where the advice of experts may be helpful.Congratulations to the newly-weds. Shame about the wedding debt though, as this has to be addressed as a priority. So what goals might they have?
- Become debt free as soon as possible.
- To save and invest as a priority.
- To own a home as soon as possible
The wedding debt is unsecured so will probably be at a high rate of interest. They need to pay off the loan as rapidly as possible, but this means they need a budget and a plan.
After paying off the debt, savings should be held in secure investments as it is short term funds for a house. They should both join KiwiSaver to gain the subsidies and they may also be eligible for the first home feature.
In terms of the “what ifs” they should consider:
- Tenant’s insurance – if they don’t already have it.
- Income protection insurance – as their only real asset is their income.
- Life insurance – as its cheapest to get while young and before any health issues arise.
- Health insurance should be considered, again before any health issues arise.
- Wills and EPAs are needed, especially now that they are married.
