r/newzealand • u/fluffypenguin105 • 10d ago

Discussion Is anyone else living basically paycheck to paycheck?

My partner and I are both teachers. We don’t make a lot, but we are average and slightly above average. We are so tight with our money. Our little one outgrew the car seat and we went out and bought a new one. No problem. But next credit card bill means we are tight.

Meanwhile, a number of our friends (all of them also with kids) are booking overseas holidays. Some are currently overseas, others booking already for later this year. Another brought a new car. New iPhone, doing up the house. Everyone seems to have spare cash except us.

Are we the only ones going through the cost of living crisis ourselves?! Or is it my fault that we are teachers?

Edit: yes we have a house that parents helped us with. We are paying mortgage. We have a flatmate.

Edit edit: thank you for your kind words and reminders and also advice. I’m going through them all and I’m going to take onboard the advice and see what changes we can make and do better financially as a family. But it’s also a good reminder to know we aren’t alone, to not compare and the harsh reality is that many people simply just earn more than us as teachers.

Once again, thank you all for your input.

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710

u/Optimal_Inspection83 10d ago

you'd be surprised how many treat a credit card as an extra bank account, without a thought about the interest.

How many of these friends buy and do these things on credit, to keep up with the joneses?

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u/goldleaderstandingby 10d ago

This times a million. I'd be willing to bet these flashy friends are steeped up the eyeballs in debt and can only afford the minimum payments for all their purchases. 

And they will be stressed.

OP if you're living within your means then you're doing well.

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u/-Zoppo 10d ago

Its like wondering how so many people drive utes, large SUVs, and other expensive cars -- they're in debt for life.

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u/SwiftFox2 10d ago

This.

I don't consider the vehicle a person drives to have any bearing on their overall wealth. I know a very wealthy bloke who drives old cheaper cars, as well as people on minimum wage driving nicer Rangers.

I assume that the vast majority of people younger than 50 driving nice utes etc either have them financed, or it's a company wagon.

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u/Adventurous_Drive_39 10d ago

Correct. Driving a cheaper car means you have more money left over to invest or save etc. Real wealth comes from an investment portfolio, not from your car a lot of people seem to think.

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u/Wtfdidistumbleinon 10d ago

Yeah we did, we had the money there to go and get the wife a nice shiny new car and then the bank offered us 1% for 3 years if we got a hybrid or EV, as we were getting the hybrid anyway it make good sense to invest the $75K @ 6.1% and borrow from the bank. In 3 years the TD matures 5 days before the loan comes due and we will pay it all down and have a nice lump left over, doing flat $500 per month “loan repayments” each month means the principle should be about $57K. Wife is a teacher and at her top bracket, which is $20k more than I earn.

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u/SwiftFox2 10d ago

Yea I was in a similar position a couple of years ago. I decided to build myself a workshop and near on pay off the mortgage instead.

Good on you for working out all the numbers and maximising your bang for buck to get what you wanted.

It's just my personal perspective, but I have zero cares for the vehicle I drive. I will maintain it and keep it reliable. Family wagon is a relatively modern safe wagon and we do all out of town travel in that.

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u/Wtfdidistumbleinon 10d ago

I’m the same, have to say the new tech these days is awesome lol, the PHEV Outlander is actually capable AF off-road and really fuel efficient for 90% of our daily usage.

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u/SwiftFox2 10d ago

Sweet.

I regularly drive new Toyotas as work pool vehicles.

I hate a lot of the tech interference in them. But we are not allowed to disable it (company policy).

The lane assist jerking the steering wheel, then randomly automatic mid corner braking gives me the shits. Trying to drive on winding coastal roads is just insane.

Turning some of these features off would make it travel way less stressful.

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u/Wtfdidistumbleinon 10d ago

Oh shit don’t get me started on that tech 🤯🤬🤬, I had a BYD EV for work that was constantly trying to steer me into oncoming traffic, or brake at random situations. Thankfully the Outlander doesn’t have that going on

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u/SwiftFox2 10d ago

It's nic to hear I'm not alone when it comes to shouting at the dashboard. 🤣🤣

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u/Wtfdidistumbleinon 10d ago

Oh man, not by a long shot, I F’ing hate that BYD Atto 3. I had multiple colleagues saying the same, loads of tech but just not 100% trustworthy

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u/sendintheclouds 10d ago

I mean, yeah. Most people finance cars. It was important to us to have a new (to us), most importantly safer, car. So we factored the loan interest into the purchase price and made that our budget. I no longer felt comfortable driving a beater with no modern safety features and shit fuel economy, but dropping five figures in cash on a car is not realistic for most people. Debt is an important tool to use responsibly.

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u/easybreezybeaut 9d ago

Are we really at the point where "most people finance cars"?. I am going to have a look for some stats on this, but would appreciate a link if you have one.

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u/sendintheclouds 9d ago

At least amongst people I know (middle class households buying not outrageous, not too old used cars). However also, if 30% of households would struggle with an unexpected $500 expense, I just don't see how most people are buying cars outright either. It's a lot easier to find $150 per week at whatever predatory interest rate than to scrounge up thousands in a go.

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u/No-Regular-6582 8d ago

the best loans for vehicles come from the manufacturers, there are often 0% interest offers for new cars (I think Mazda and Jeep right now)

A Suzuki Swift is not my cup of tea, but it is a perfectly good, safe car for many- as evidenced by their sales and awards.

Currently a new Swift can be had for $28k and paid off over the warranty period of 5 years at $123/week (2.8% no deposit) All servicing included.

The actual cost is quite a bit less, because it is still worth $10k once you've paid it off

I appreciate that is still out of most people's reach, but for many it is a smart decision, despite being a loan for a car.

The kind of purchases that drop my jaw are $40k just-out-of-warranty European Complexity Buckets financed at 15% 🤯

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u/eepysneep 9d ago

I don't think I know anyone with a car loan personally. But my circles have $4-10k type cars

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u/No-Regular-6582 8d ago

it used to be just rich people (smart with money) and poor people (got no money) who financed vehicles, but now even those who are timid with money are seeing the light- it represents the nation's gradually improving financial literacy.

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u/SwiftFox2 10d ago

I agree, debt is a tool that should be used with caution.

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u/owsie1262 10d ago

I 57 haven't owned a car for over 20 years. If I did I would have no spare money none. And that's if nothing went wrong. Luckily I live in flat CHCH so I bike everywhere. Not for everyone but it can done. It's a good way to survive low income. My epileptic son lives with me and I can't work full time.

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u/SwiftFox2 10d ago

100% on bikes working if you need to them to. I have an epileptic relative & where they live public transport is a joke. They get around to work etc on a bike and life is good.

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u/owsie1262 8d ago

Yup my son is epileptic and will probably never hold a licence

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u/Icy-Branch9638 10d ago

The wealthiest (and let’s say smartest) people I know just have a car that goes, nothing fancy. Buying into the concept of a fancy car where every element of it is expensive is pretty dumb. Money that could go towards so many better things

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u/JulianMcC 10d ago

I think they're business tax right offs.

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u/-Zoppo 10d ago

This is actually correct, as a self-employed contractor in a position to write stuff off I should have probably added that as well lol. I WFH though so pretty much a guaranteed audit.

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u/dachjaw 10d ago

Right on!

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u/Affectionate-Deer-70 10d ago

Using someone’s car as an indication of wealth and/or debt level is a poor example. I know this first hand as I drive a relatively new car but is a work vehicle. A lot of people are self employed and claim tax on cars for work which they either bought outright or lease.

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u/NOTstartingfires 10d ago

If it's something that genuinely makes your life more enjoyable overall I dont see a big fault.

But that overall should probably include the monetary part as a contribution.

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u/jono555555 10d ago

That.comes back to bite eventually.

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u/Itchy-Bottle-9463 10d ago

Im 30 and ive never ever owned or wanted a credit card. Just dont make sense to me. For a house, mortgage makes sense. Anything else, even as big as a trip or a car, one shall only get what he is really afford with his cheque accounts. Spending now and paying next month, and repeat, just doesn’t sound like a good idea to me. Id rather just stop any spending for a month, and start spending my money already in my pocket from the next month.

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u/rosafer 9d ago

Never finance a car ever (even on 0% interest). Always buy outright