Top Ten Budgeting Myths

1 - Budgeting is easy...

Writing up a budget is fairly easy. Creating and sticking to a budget plan is a lot harder. But living the debt free lifestyle of your choice is definitely easy. Your budget adviser will show you how to write up a budget but this is just the first part of a much more significant, and often life changing, process. The budget is a tool advisers use to create your overall budget plan. Most people don't have one of these but everyone should. Don't leave it any longer, call your local budget service today and find out just how easy it really can be.

2 - Budgeting is for people in debt crisis...

Sure, budget advisers see a lot of people undergoing serious financial difficulties but they also help people in financially stable situations every day. Going to see a budget adviser is like going to see your doctor or dentist for a check up. We call this a financial wellness check up. Anyone will benefit from seeing a Federation certificated budget adviser. No matter how much or little you earn, no matter how large or small your current debt level, even if you have no debts at all, the very best time to get budget advice is right now.

3 - Debt consolidation is the best answer...

Debt consolidation can work in some situations very well. In other situations consolidating your debts can leave you far worse off than you originally were. Debt consolidation means you take out a loan with just one provider to pay off all of your other outstanding debts. It makes things a little easier but usually you will end up paying much more in interest and paying off your debts over a much longer period of time. Budget advisers have many other options for you, like cashflows, SIOs, TMM and creditors' pools. Call your local budget service, they don't offer quick fixes but they do offer answers. Still not convinced? Just ask yourself why the people advertising debt consolidation as a good thing are the same people that want to sell you debt... do they really want to help you out, or do they really just want your money?

4 - One budget service is the same as another...

Due to a lack of regulation, there are many 'budget services' out there offering 'advice' in the community and one is definitely not the same as another. Federation certificated budget advisers are highly trained, very experienced, and highly resourced people with an entire network of experts for support. Federation services are audited every year to ensure they meet very rigorous standards and they are the only provider who can offer you an impartial, national complaints procedure if something goes wrong. We continue to see many people end up worse off by taking advice from poorly trained and inexperienced people. Call your local budget service today and demand to see a current Certificate of Affiliation to the New Zealand Federation of Family Budgeting Services. It's the guarantee of quality.

5 - There's no such thing as a free lunch these days...

In a world where inflation keeps adding to the cost of everything we buy, where user-pays has become so common-place we expect to hand over money for everything, where even the few things left that are still free we are now expected to make a 'donation' for, it's a small relief that we've held on to a few free treasures in this country. One of those treasures is the Budget Advisory Service. Established in 1973, free budget advice has been offered in Aotearoa-New Zealand by a legion of volunteers for over 30 years... and we're still going strong! If you like the sound of free stuff then call your local budget service for a free appointment.

6 - I'm too (young, old, poor, dumb, etc.) to do budgeting...

Budget advisers have heard every excuse under the sun (and then some)! But seriously, budgeting isn't easy it's like learning any new skill it takes a lot of practice and you need to be prepared to make some mistakes and to learn from them. Advisers come from all walks of live, in fact many of our advisers are previous clients, so they understand where you coming from and what your going through. Most importantly they must remain non-judgemental and will never judge you for who you are or what you do. By the way if you think you're too old or too young, think again, the under 25 and over 55 age groups are under-represented by our clients and are, arguably, the most important times to be learning about your finances... So enough of the excuses book in for an appointment today.

7 - Its not appropriate to discuss your financial affairs with a stranger...

Two more great things about Federation certificated advisers are that they offer culturally aware advice that is totally confidential. Our advisers are trained to understand about all the wonderful different cultures that make up Aotearoa-New Zealand. They will only ever discuss your finances with others after you say it's ok and it's usually just to your creditors. The Federation Code of Ethics states that total confidentiality will never be breached between you and your adviser. Federation advisers are highly trained to understand who you are and to offer advice that is culturally appropriate to you and your family/whanau. Give your local service a call and talk to them about their culturally appropriate and confidential budget advice.

8 - People can't save on a low income...

This is actually one of the greatest myths of our time and is one of the reasons why we have created a benefit-dependency in this country. People on low incomes (even those living on a benefit) can and do save. Without savings you are living on a tightrope without a safety net; the smallest thing that goes wrong could make you fall with nothing to catch you. Even saving $10 a week will give you a safety net able to fix that flat tyre or rust spot on your car, replace that appliance that blows up, or get the carpets clean after that party... The best thing is that if something doesn't go wrong then you have $520 (plus interest) in the bank at the end of the year to put towards that family holiday you've all been wanting. Budgeting is about learning a savings behaviour. Once you've learnt how to save, the more you earn the more you can put away until one day you're financially independent. Call your budget service and find out how.

9 - Budget advice is just about budgeting...

Budget advice is mostly about budgeting. Budget advisers know about a whole lot of other things though. Many advisers are trained in different specialist techniques including: credit contract analysis, creditor pools, summary installment orders, and creditor negotiations, help with Work and Income and IRD entitlements, access to foodbanks, access to and negotiations with Housing New Zealand, access to Telecom packages only available to Federation clients and referrals to help with other issues such as addictive behaviour, legal issues, and other specialist advice available in the community. And these are just some of the things your adviser can do for you!

10 - Budgeting doesn't work...

So you've tried budgeting and it worked for a while but eventually the money still ran out; budgeting just doesn't work, right? Actually budgeting really does work but its not just about writing up a budget. It's a bit like dieting or exercising, if you just jump into it the results are great in the short term but eventually you're back to where you started. That's because, just like with dieting and exercising you need a plan that you can work to. And, again just like dieting and exercising, having an experienced personal trainer can make all the difference. Budgeting is about empowerment and education. Your budget adviser will give you the education and tools you need to deal with those tricky financial situations allowing you to empower yourself to take charge of your life. Call your local budget service and make an appointment, it costs you nothing and it literally could change your life... do it for you and your family/whanau, do it today!

© 2007 New Zealand Federation of Family Budgeting Services Inc.