WEBVTT - Martin Hawes: Mortgage arrears increase by 1,100 in December 0:00:05.761 --> 0:00:09.401 You're listening to the Weekend Collective podcast from News Talks. 0:00:09.401 --> 0:00:09.721 It'd be. 0:00:11.241 --> 0:00:13.801 In the summer time when the well, who is hot? 0:00:14.121 --> 0:00:17.281 You can stretch right up, ben versus guy. When the 0:00:17.361 --> 0:00:20.681 weather's fine. You got women, you got women on your mind, 0:00:22.841 --> 0:00:26.081 have a drink, cabageove, go out and see what you get. 0:00:26.161 --> 0:00:31.201 Fine, if that is rich, take her out of a meal. 0:00:31.521 --> 0:00:34.161 If not is part just do what you fail. 0:00:34.281 --> 0:00:37.081 Speed alone and lady you can die and or rejoin. 0:00:37.161 --> 0:00:38.041 It's ready five. 0:00:40.121 --> 0:00:42.641 When the sun goes down, you can make it bigger, 0:00:42.721 --> 0:00:48.081 good and ali by. We're not bed people when not diddy, 0:00:48.121 --> 0:00:51.041 we're not mean. We love everybody, but we do as 0:00:51.081 --> 0:00:51.601 we please. 0:00:51.881 --> 0:00:54.321 And welcome back to the service of the Weekend Collective 0:00:54.361 --> 0:00:57.081 on Tion Beverage. And this is smart Money. By the way, 0:00:57.081 --> 0:00:58.641 if you've missed any of our previous house you want 0:00:58.641 --> 0:01:00.121 to catch up on them, to go to the News 0:01:00.121 --> 0:01:02.961 Talk c B website or to iHeartRadio and look for 0:01:03.001 --> 0:01:06.721 the podcast for the Weekend Collective. As I mentioned right now, 0:01:06.761 --> 0:01:08.921 it is time for smart Money. Want your calls on 0:01:09.041 --> 0:01:11.361 eight hundred and eighty ten eighty in text on nine 0:01:11.401 --> 0:01:14.201 to nine to two. We're going to have a chat 0:01:14.201 --> 0:01:17.641 about I guess, broadly speaking, managing your indebtedness, but how 0:01:17.721 --> 0:01:21.081 much debt you should take on? For instance, how much 0:01:21.081 --> 0:01:22.881 should you spend on a house versus how much the 0:01:22.881 --> 0:01:25.481 bank is willing to lend you. Because new data from 0:01:25.521 --> 0:01:29.321 Centris has revealed that the number of homeowners who are 0:01:29.321 --> 0:01:33.961 behind on their mortgaged and mortgage sorry increased by eleven 0:01:34.041 --> 0:01:41.161 hundred people in December alone. So with interest rates dropping significantly, 0:01:41.441 --> 0:01:42.921 many would have thought things would be a little bit 0:01:42.921 --> 0:01:46.161 easier financially. So what has happened and how are people 0:01:46.201 --> 0:01:47.761 coping with that? And what is the best way to 0:01:47.801 --> 0:01:51.041 manage that debt? And I mean, how desperately should you 0:01:51.081 --> 0:01:53.761 also just make sure that you don't get into debt? 0:01:53.801 --> 0:01:57.281 And how do you see about managing your debt so 0:01:57.321 --> 0:01:59.281 you don't get into trouble with things like your mortgage, 0:01:59.281 --> 0:02:01.201 which is the last thing you would want anyone to 0:02:01.241 --> 0:02:03.721 be stressed about, because the stress around being behind on 0:02:03.761 --> 0:02:08.641 your mortgage payments just be absolutely horrendous. Anyway, joining us 0:02:08.721 --> 0:02:11.681 to talk about that is the financial author of how 0:02:11.681 --> 0:02:14.041 many books I think we've lost count But there's another one? 0:02:14.401 --> 0:02:16.161 Is it coming out soon? It's Martin Hall is goody 0:02:16.201 --> 0:02:16.801 Martin how are you? 0:02:16.921 --> 0:02:19.321 Yeah, yeah, hi, hi there, Yes it is. It's coming 0:02:19.361 --> 0:02:20.761 out in March. 0:02:21.201 --> 0:02:23.281 This is number seventeen or eighteen. 0:02:23.281 --> 0:02:24.761 No, it's twenty four. 0:02:25.041 --> 0:02:27.321 Oh, twenty four books. 0:02:27.601 --> 0:02:30.921 Yeah, I'm so embarrassed to say the number. But it's 0:02:30.961 --> 0:02:32.681 over a long period of time. You know. I wrote 0:02:32.681 --> 0:02:35.601 my first one in nineteen eighty seven, so you know, 0:02:35.681 --> 0:02:38.321 it's not like I've just rustled them up in the 0:02:38.401 --> 0:02:39.921 last couple of weeks or some point. 0:02:39.841 --> 0:02:43.041 I guess, because there must be themes that do recur 0:02:43.361 --> 0:02:45.481 in the books. But are there or do you manage 0:02:45.521 --> 0:02:49.041 to write completely about something that you've never written about before. 0:02:50.041 --> 0:02:54.241 I'd call it crossover? Yeah, you know, so if I 0:02:54.281 --> 0:02:57.801 write about investment, I have to write a little bit 0:02:57.841 --> 0:03:01.601 about property investment. And I've already wrested on a wholebok 0:03:01.641 --> 0:03:03.761 on property investment. Very outdated. 0:03:03.881 --> 0:03:04.121 Now. 0:03:05.041 --> 0:03:06.321 I had a look at the other day and I 0:03:06.481 --> 0:03:08.921 was talking about houses, you know, good houses that you 0:03:08.961 --> 0:03:11.241 could buy for two hundred thousand, that sort of stuff, 0:03:11.841 --> 0:03:13.481 because it was done well, it was done back in 0:03:13.641 --> 0:03:17.681 ninety war, I think of ninety five or something. So 0:03:17.841 --> 0:03:20.641 it's you know, it whatard embarrass me to see it 0:03:20.681 --> 0:03:23.761 in a bookshop now. But you know, there's always a 0:03:23.761 --> 0:03:29.441 bit of crossover, but it's certainly themed quite separately, and 0:03:29.521 --> 0:03:32.841 they're about the big picture, if you like. Is quite 0:03:32.841 --> 0:03:38.201 a different topic from anything else I've done. Yeah. Has 0:03:38.201 --> 0:03:42.681 it got a title, Yeah, A Retirement Ready. So it's 0:03:42.721 --> 0:03:45.801 a book about it's quite biographical. I think I've probably 0:03:45.801 --> 0:03:51.241 said this to you before, but I had a couple 0:03:51.281 --> 0:03:54.241 of bad years in my life, ended up moving from 0:03:55.961 --> 0:04:02.121 Queenstownd to christ Church. And when you have a big 0:04:02.201 --> 0:04:05.161 change in your life, and I certainly have a big change, 0:04:05.401 --> 0:04:08.201 I sat down and figured out what part of my 0:04:08.321 --> 0:04:10.881 finances need to change, and there are probably six or 0:04:10.921 --> 0:04:15.321 seven major areas. So I wound up the family trust, 0:04:16.201 --> 0:04:20.361 I did a new will, I handed my investments over 0:04:20.521 --> 0:04:24.681 to somebody to manage for me after forty five years 0:04:24.841 --> 0:04:26.881 of doing it. So a bunch of stuff like that. 0:04:27.001 --> 0:04:31.281 So the book basically relates those things, because although I 0:04:31.321 --> 0:04:34.361 don't intend to retire, I know very well that I 0:04:34.401 --> 0:04:38.441 could be retired. I could find myself retired for some 0:04:38.841 --> 0:04:39.441 reason or other. 0:04:40.921 --> 0:04:42.921 Well, of course, for many people, the thought of retiring 0:04:42.961 --> 0:04:45.321 is a long way away. When you've got these figures 0:04:45.321 --> 0:04:48.001 about the number of people who are behind on their mortgages. Yes, 0:04:50.081 --> 0:04:52.481 it does feel pretty grim, doesn't when you see those 0:04:52.521 --> 0:04:53.761 sorts of headlines, isn't it? 0:04:54.281 --> 0:04:58.001 Yes? It does. And look, I don't think the recession 0:04:58.041 --> 0:05:02.401 is over. It's hard to know. In New Zeallympics. We 0:05:02.641 --> 0:05:07.681 are so behind and getting data. We don't get data monthly, 0:05:07.761 --> 0:05:12.281 we get generally quarterly, and I think that's a real 0:05:12.361 --> 0:05:14.841 fault New Zenald, So we we don't know how bad 0:05:14.881 --> 0:05:17.641 things are they are. But I have a bunch of 0:05:18.041 --> 0:05:21.121 small business owners who I talk to pretty regularly and 0:05:21.241 --> 0:05:23.881 have done for years, in some cases forty odd years, 0:05:24.721 --> 0:05:27.401 and some of them have always been extremely good bell 0:05:27.481 --> 0:05:31.241 weathers for telling me what's going on in the in 0:05:31.281 --> 0:05:34.441 the in the economy. And you know, if I say 0:05:34.481 --> 0:05:36.961 it one of them, you know, how are sales at 0:05:37.001 --> 0:05:42.801 the moment, and they say absolutely dreadful, then I know 0:05:42.881 --> 0:05:45.041 that that's a pretty good sign that people are hurting 0:05:45.561 --> 0:05:48.841 out there, and I think they are. And you know 0:05:48.921 --> 0:05:55.281 that that figure showing mortgage differulties rising in December. December 0:05:55.361 --> 0:05:58.561 is a high expense month, so you're trying to do 0:05:58.601 --> 0:06:01.601 something for the kids, You're trying to have a reasoning 0:06:01.721 --> 0:06:05.441 sort of Christmas, and the mortgage shouldn't go on the 0:06:05.441 --> 0:06:10.161 back burner, but it very often does. And I suspect 0:06:10.281 --> 0:06:12.441 January is going to be pretty tough for people, and 0:06:12.601 --> 0:06:16.401 probably for another three months or so at least. 0:06:16.521 --> 0:06:18.441 Yes, because the number of people who are behind on 0:06:18.481 --> 0:06:20.761 their mortgages is over twenty two thousand now, so that 0:06:20.921 --> 0:06:24.641 number increased by eleven ye yeah, yeah, yeah, I can't 0:06:24.681 --> 0:06:27.281 think of any Oh. Look, look, there's all sorts of 0:06:27.321 --> 0:06:29.041 stresses that we can have in life, but in terms 0:06:29.081 --> 0:06:32.001 of financial stress, I've got to think that being behind 0:06:32.001 --> 0:06:36.521 on your mortgage must be the the up there in 0:06:36.601 --> 0:06:38.761 terms of the number one that you don't want to be, 0:06:38.841 --> 0:06:39.321 And isn't it. 0:06:39.601 --> 0:06:42.641 No, yeah, that'll be right. But tim of you ever 0:06:42.681 --> 0:06:46.161 lost your job, you know, don't come back, don't hume 0:06:46.241 --> 0:06:49.481 back Monday. So an awful lot of public servants have 0:06:49.601 --> 0:06:55.521 lost their jobs and there's a fair unemployment as rising. 0:06:55.881 --> 0:07:00.401 Infrastrates are not really falling terribly quickly. So they are, 0:07:00.441 --> 0:07:03.801 you know, the four point two five, but you know 0:07:03.841 --> 0:07:09.001 we've got floating which is a seven percent and fixed 0:07:09.121 --> 0:07:12.641 the fixed rate ones that six six and a half. 0:07:12.721 --> 0:07:16.321 That that kind of thing. They're not they're still pretty 0:07:16.401 --> 0:07:19.561 jolly expense of given the fact that inflation's gone down 0:07:19.601 --> 0:07:22.201 to two point two last cause, which really takes me. 0:07:22.481 --> 0:07:24.961 Sorry to interrupt and rave. 0:07:24.881 --> 0:07:27.881 Varner, but no, this is what you stay silent. 0:07:30.681 --> 0:07:38.481 Me stay silent. Never the we measure inflation quarterly in 0:07:38.521 --> 0:07:42.401 this country, so our inflation came out, I mean it 0:07:42.401 --> 0:07:45.361 was the twenty second of January, and that was for 0:07:45.401 --> 0:07:50.281 the last quarter, so that was October, November, December, so 0:07:50.361 --> 0:07:55.001 we knew at the end of January what inflation had 0:07:55.041 --> 0:07:59.241 been in October, because you know, like the US and 0:07:59.281 --> 0:08:03.881 the UK and most big economies measuring this monthly, so 0:08:04.281 --> 0:08:07.401 they've got their finger right on the pole. So Deserve 0:08:07.481 --> 0:08:13.801 Bank is getting those those numbers and being i think 0:08:13.961 --> 0:08:21.321 very reactive and and and dropping intst rates and quite 0:08:21.321 --> 0:08:26.161 big chunks as they see. We don't know what inflation 0:08:26.441 --> 0:08:30.761 was in January, and we won't know until April, yeh 0:08:31.481 --> 0:08:31.921 of April. 0:08:32.401 --> 0:08:34.121 And of course, I mean just generally in terms of 0:08:34.161 --> 0:08:36.721 the economy and the global outlook, there's still a wack 0:08:36.721 --> 0:08:38.761 of uncertainty there out there at the moment, isn't there 0:08:38.801 --> 0:08:41.361 Just it's just colossal there is. 0:08:41.601 --> 0:08:45.001 Yes, investors are doing well. Investors are doing quite well. 0:08:45.041 --> 0:08:48.241 What sort of investors you mean people are, yeah, you. 0:08:48.281 --> 0:08:53.521 Keep you saving investors and Shermark and investors and the likes. 0:08:53.721 --> 0:08:56.601 But I think where there's probably a lot of hurts 0:08:56.641 --> 0:08:59.921 in the small medium sized business area in New Zealand. 0:08:59.641 --> 0:09:01.561 Because one of the things I think I was as 0:09:01.601 --> 0:09:04.321 I was looking at the questions that we've sort of 0:09:04.321 --> 0:09:06.001 lined up to talk out with her to do with 0:09:06.041 --> 0:09:07.761 the debt and how much should you spend on a 0:09:07.801 --> 0:09:10.481 house versus how much the bank is willing to lend you, 0:09:11.241 --> 0:09:13.521 I was thinking that if I was sitting back and 0:09:13.561 --> 0:09:17.281 listening to conversations around debt, and I guess through the 0:09:17.321 --> 0:09:21.361 course of smart Money, I've we hear people talking about 0:09:21.881 --> 0:09:24.761 how to use debt and how debt can be used 0:09:24.801 --> 0:09:28.641 to build your wealth and things like that. And yet 0:09:29.521 --> 0:09:31.761 when you are in the situation where debt's getting on 0:09:31.801 --> 0:09:34.481 top of you, and now we're looking at the number 0:09:34.481 --> 0:09:37.601 of people who are not managing their mortgages, I just 0:09:38.161 --> 0:09:40.601 I think there's some of the question about there about 0:09:40.641 --> 0:09:45.441 what is what attitude should we have towards debt and 0:09:45.521 --> 0:09:48.601 to how approach it to approach it, because of course, 0:09:48.641 --> 0:09:51.881 when you are borrowed in a property market which is 0:09:51.881 --> 0:09:54.921 going gangbusters, then you've leveraged up the ying yang and 0:09:54.961 --> 0:09:57.001 you might be terrified, but then you're laughing a few 0:09:57.081 --> 0:10:01.361 years later because things are gone nutty. But if it 0:10:01.401 --> 0:10:03.761 goes the other way as well, and you get bitten 0:10:04.001 --> 0:10:07.521 by too much debt, it can really ruin your life, 0:10:07.561 --> 0:10:07.961 can't it. 0:10:09.081 --> 0:10:11.761 Absolutely. You know, it's a double short sort. You know, 0:10:11.801 --> 0:10:14.681 it cuts back to ways. It cuts on the upside. 0:10:14.681 --> 0:10:17.241 It's great on the upside, as you say, but it's 0:10:17.401 --> 0:10:20.241 really really bad on the downside. You know, we've been 0:10:20.281 --> 0:10:23.601 talking about mortgages, and you know, I think everybody would 0:10:23.601 --> 0:10:26.761 say it's fair enough, it's probably absolutely necessary, and the 0:10:26.881 --> 0:10:30.241 vast vast majority of people the cases that they would 0:10:30.281 --> 0:10:33.521 have to borrow to buy a house. But it's when 0:10:33.641 --> 0:10:39.201 people are borrowing to buy consumer items like appliances and 0:10:39.721 --> 0:10:43.361 so forth, and these things are always going to depreciation 0:10:43.561 --> 0:10:46.801 value that you're starting to get in trouble. And the 0:10:46.881 --> 0:10:51.281 trouble becomes much worse when you start to borrow for consumption, 0:10:51.921 --> 0:10:55.921 and that you really are on the skids there. So 0:10:56.161 --> 0:10:58.561 I always think of debt as you know, there's good debt, 0:10:58.601 --> 0:11:01.121 and that's for things that go up in value will 0:11:01.161 --> 0:11:02.961 tend to go up in value being houses, and. 0:11:05.081 --> 0:11:08.201 It's as that supports your ability, supports your ability to 0:11:08.241 --> 0:11:11.001 generate income which covers more than the debt pays for them. 0:11:11.041 --> 0:11:13.881 You know. Yep. But when you go out and you 0:11:13.881 --> 0:11:18.321 put the car or the new dishrusher on HV, I 0:11:18.321 --> 0:11:19.281 think that's a hold. 0:11:19.041 --> 0:11:23.961 Of the border because for some people, that is borrowing 0:11:24.041 --> 0:11:27.681 to buy basic things that I would call them housing 0:11:27.681 --> 0:11:30.161 infrastructure in a way you just talked about buying a 0:11:30.201 --> 0:11:32.601 dryer or a bed or things like that. People borrow 0:11:32.641 --> 0:11:37.001 a lot for that. It's quite consistent. I don't know why, 0:11:37.161 --> 0:11:40.321 because I never really got particularly financial advice from my 0:11:40.441 --> 0:11:44.681 family or anything, but I always thought instinctively that putting 0:11:44.721 --> 0:11:47.321 something on lay by or paying something off gradually didn't 0:11:47.321 --> 0:11:49.401 make sense, just because I thought, well, why would you 0:11:49.441 --> 0:11:51.521 do that? Why wouldn't you just wait until you've got 0:11:51.841 --> 0:11:54.041 the money and then buy. But not everyone has that 0:11:54.121 --> 0:11:57.121 convenience of just going, well, I'll wait a little bit 0:11:57.121 --> 0:11:59.601 longer till I've saved for that particular item, and that 0:11:59.761 --> 0:12:01.641 becomes part of their way of life, doesn't it. 0:12:02.081 --> 0:12:07.121 Yeah, yep. And Lita, it's a lower income country, you know, 0:12:07.201 --> 0:12:09.241 there are a lot of people, even in relatively good 0:12:09.241 --> 0:12:12.401 time who are struggling. We don't pay high wages here. 0:12:12.401 --> 0:12:17.121 We don't have industries that are able to afford to buy, 0:12:17.721 --> 0:12:22.721 sorry to pay high wages. You know, it's fairly hard 0:12:22.801 --> 0:12:26.681 scrabble being in Mirrle New Zealand, even at the very 0:12:26.721 --> 0:12:30.281 best of times, let alone at times like now when 0:12:30.321 --> 0:12:34.921 there are layoffs happening, when infistrates are sticky. On the upside, 0:12:36.481 --> 0:12:38.241 it's pretty jully hard for people. 0:12:39.001 --> 0:12:40.641 What advice do you give to people who are in 0:12:40.681 --> 0:12:42.881 a position of paying off debt how quickly they should 0:12:42.881 --> 0:12:45.121 do it, because if it would love to hear your 0:12:45.921 --> 0:12:49.161 approach on this as well, how hard do you strive 0:12:49.241 --> 0:12:51.601 to pay off debt versus going Well, Okay, I could 0:12:51.601 --> 0:12:53.721 pay my mortgage off a few years earlier, but I 0:12:53.761 --> 0:12:56.921 also do want to actually enjoy life before I need 0:12:56.921 --> 0:13:00.121 to retire, because it is it is an interesting balance 0:13:00.161 --> 0:13:03.081 to strike, isn't it Like I could probably I'm we're 0:13:03.081 --> 0:13:05.161 in the fortunate position that we've paid a lot of 0:13:05.161 --> 0:13:08.401 our mortgage off, but if I really wanted to, I 0:13:08.401 --> 0:13:11.721 could probably pay it off several years earlier. But the 0:13:11.841 --> 0:13:15.761 hedonistic part of Tim Beveridge wants to have that wants 0:13:15.761 --> 0:13:17.961 to go hiking in the in the Alps. 0:13:18.161 --> 0:13:21.081 Yeah, there's a there's a balance on that, isn't it. 0:13:21.081 --> 0:13:26.001 But my general principle, if the debt is non tax deductible, 0:13:26.121 --> 0:13:28.281 you know, so it's for the house you're going to 0:13:28.321 --> 0:13:30.961 live in or for its an appliance, and it's not 0:13:31.241 --> 0:13:34.521 for a business or to invest in property or something 0:13:34.601 --> 0:13:37.201 like that, then I would be saying, pay off that 0:13:37.401 --> 0:13:40.521 non deductible debt as fast as you possibly can get 0:13:40.561 --> 0:13:43.201 that off your back, and then I think you can 0:13:43.241 --> 0:13:46.561 start to relax. Now the bit of rolling of eyes 0:13:46.681 --> 0:13:49.681 and so forth when I say this, but I always 0:13:49.681 --> 0:13:53.001 think as an aim, people should try to have their 0:13:53.041 --> 0:13:55.961 mortgage paid off by the time they're in their early 0:13:56.361 --> 0:14:00.161 early to mid fifties, something like something like that. And 0:14:00.201 --> 0:14:02.601 I think when that happens, you'd have with bloody good 0:14:02.681 --> 0:14:06.121 celebration and maybe even spend you know, make the last 0:14:06.121 --> 0:14:08.521 mortgage payment and then make the next fun that you've 0:14:08.521 --> 0:14:11.321 got for a really good trip or something. I've really 0:14:11.321 --> 0:14:12.361 looked forward forward. 0:14:12.801 --> 0:14:15.961 And the reason I raised that is because I recently 0:14:16.121 --> 0:14:19.001 just for an exercise. It ties into a couple of 0:14:19.001 --> 0:14:23.001 things You've talked about how the cost of borrowing is 0:14:23.001 --> 0:14:25.401 still quite high, so we've got. I think that there's 0:14:25.441 --> 0:14:28.841 this there's this idea that in New Zealand that oh, 0:14:28.961 --> 0:14:31.121 look this house is only eight or nine hundred thousand 0:14:31.121 --> 0:14:33.561 dollars or something, and people think, oh, that's that doesn't 0:14:33.601 --> 0:14:35.281 sound that expensive. But then you work out what the 0:14:35.321 --> 0:14:37.321 mortgage is on that and you go, hell, that's a 0:14:37.321 --> 0:14:40.881 lot of money. But what it ties into is that 0:14:41.441 --> 0:14:43.521 if you do decide to let that mortgage go for 0:14:43.521 --> 0:14:47.521 another five years, that is actually worth a truckload of money, 0:14:47.561 --> 0:14:50.281 isn't it? And the interest Whereas if you so, the 0:14:50.321 --> 0:14:52.561 moral of the story I'm yes, I'm leaning to is 0:14:52.601 --> 0:14:56.561 I should be lecturing myself to biting the bullet and 0:14:56.601 --> 0:14:59.841 paying that mortgage off as fast as possible because it's 0:14:59.921 --> 0:15:03.081 worth tens, if not hundreds of thousands of dollars, isn't it. 0:15:04.081 --> 0:15:06.841 If I well a financial advisor, and I'm not from 0:15:06.881 --> 0:15:10.121 I was your financial advisor, I'd be banning with table. 0:15:10.161 --> 0:15:13.601 I'm saying, yes, get rid of the thing. Life can 0:15:13.641 --> 0:15:15.921 be a whole lot different if you don't have that 0:15:16.361 --> 0:15:17.241 monkey on your back. 0:15:18.481 --> 0:15:20.681 So we want to know your attitude to debt. This 0:15:20.841 --> 0:15:23.001 is basically a simple question. We've got lots of questions 0:15:23.001 --> 0:15:25.041 around this about how much you should spend on your 0:15:25.041 --> 0:15:28.041 house versus how much the bank is willing to lend you. 0:15:28.481 --> 0:15:31.761 But how if you are listening right now, how cautious 0:15:31.801 --> 0:15:34.561 are you or careless if you like. And I don't 0:15:34.601 --> 0:15:36.561 mean that in a judgmental way either, because we can 0:15:36.601 --> 0:15:39.321 all form our own judgments on our attitude towards money. 0:15:39.321 --> 0:15:43.801 But how cautious are you when it comes to debt? 0:15:44.001 --> 0:15:45.961 Because while you might be borrowing for something which you 0:15:45.961 --> 0:15:48.521 think is going to make you a fortune, if it 0:15:48.561 --> 0:15:51.801 turns the other way, it can be a really nasty 0:15:51.881 --> 0:15:53.281 You can find yourself in a bit of a pickle. 0:15:53.361 --> 0:15:56.521 So do you try and pay off your mortgage as 0:15:56.561 --> 0:15:59.201 fast as possible or do you sort of think, well, 0:15:59.241 --> 0:16:01.841 you know what, I also want to be able to 0:16:01.921 --> 0:16:04.881 enjoy life. But that ten thousand dollars holiday you might 0:16:05.481 --> 0:16:08.241 or maybe even more if you're going overseas, how much 0:16:08.321 --> 0:16:11.161 is that worth in the mortgage ultimately that you're going 0:16:11.241 --> 0:16:13.321 to pay for that holiday because you didn't stick it 0:16:13.361 --> 0:16:15.601 off your mortgage in the first place. I just want 0:16:15.641 --> 0:16:18.721 to know that your attitude towards how urgently you address 0:16:18.961 --> 0:16:21.041 paying off your debt eight hundred and eighty ten and 0:16:21.121 --> 0:16:24.001 eighty text nine two nine two. You can email Tim 0:16:24.041 --> 0:16:25.721 be it Newstalks said, be But you know what, this 0:16:25.761 --> 0:16:27.521 is a talk back show, so let's get on the blower. 0:16:27.681 --> 0:16:30.081 Twenty three past five. Welcome back to Smart Money. My 0:16:30.121 --> 0:16:33.841 guest is financial author. He used to be a financial advisor, 0:16:33.881 --> 0:16:35.841 but now he's a financial author. He dishes out of 0:16:35.881 --> 0:16:36.441 his advice. 0:16:36.761 --> 0:16:37.001 Did I? 0:16:37.161 --> 0:16:40.041 I didn't. I hope I didn't describe his financial advisor earlier, Martin. 0:16:40.081 --> 0:16:44.001 But anyway, we've moved on. It's Martin Hahawes and he's 0:16:44.001 --> 0:16:45.601 got a new book coming out soon, by the way, 0:16:45.641 --> 0:16:48.321 Retirement Ready, So keep an eye out for that when 0:16:48.361 --> 0:16:51.441 it does actually hit the shops. I realized, actually the 0:16:51.441 --> 0:16:55.241 way I framed my question, by the way, was around 0:16:55.281 --> 0:16:57.841 our attitude to debt. But I think that the more 0:16:57.881 --> 0:17:01.241 digestible question for people is we, in most of us 0:17:01.281 --> 0:17:03.481 who've got a house or rent, we've got some sort 0:17:03.521 --> 0:17:07.881 of debt, haven't we. What are the luxuries that you 0:17:08.001 --> 0:17:11.361 often see taking priority? What are the luxuries in your 0:17:11.401 --> 0:17:14.401 life that you give priority to because you still want 0:17:14.401 --> 0:17:17.281 to live when in fact, if we listened to the 0:17:17.321 --> 0:17:19.881 advice that Martin might give, if you're still a financial adviser, 0:17:19.921 --> 0:17:22.241 there would be banging the table saying, just pay off 0:17:22.321 --> 0:17:27.881 the mortgage. Martin. In your own life, you would have 0:17:27.881 --> 0:17:31.121 had moments where you possibly could have paid more off 0:17:31.121 --> 0:17:33.081 something I'm guessing, but you would have made a trade off. 0:17:33.281 --> 0:17:34.321 What were your trade offs? 0:17:34.321 --> 0:17:34.521 For? 0:17:35.681 --> 0:17:42.041 My trade offs were generally lifestyle rather than buying stuff. 0:17:42.401 --> 0:17:44.041 I mean I could have made a lot more money. 0:17:44.361 --> 0:17:49.481 Have I been or christ Church rather than Queenstown, then 0:17:50.241 --> 0:17:52.521 I would have had a much bigger career. I knew 0:17:52.521 --> 0:17:56.681 it at the time, but I thought, well, I'm I'm 0:17:56.881 --> 0:18:00.521 prepared to give up, to give up some income, to 0:18:00.521 --> 0:18:03.481 give up building a business or anything like that, and 0:18:04.441 --> 0:18:09.801 have a lifestyle full of mountaineering and skiing and well 0:18:10.361 --> 0:18:11.481 generally messing around. 0:18:11.801 --> 0:18:14.441 That's exactly the issue I think many of us have. 0:18:14.521 --> 0:18:16.401 And look, we live in a gorgeous country. We want 0:18:16.441 --> 0:18:18.761 to make the use of it. But also New Zealanders 0:18:18.881 --> 0:18:21.841 love overseas travel. I mean, you're the sentiments you've just 0:18:21.881 --> 0:18:24.601 talked about the mountains and skiing and lifestyle and mountaineering. 0:18:24.721 --> 0:18:27.321 I think you've been. Haven't you been mountaineering in France recently? 0:18:27.561 --> 0:18:30.041 Yes? I have? Yeah, yeah, well a year ago, oh, 0:18:30.041 --> 0:18:30.641 a year ago. 0:18:30.881 --> 0:18:32.921 Well, let's call it recently, because that's the same time 0:18:32.961 --> 0:18:35.281 I heard our trip. But those are the questions, and 0:18:35.321 --> 0:18:40.681 that is that the cynical way I would put it, 0:18:40.921 --> 0:18:44.641 cynical way whatever, Just the way I would say, which 0:18:44.881 --> 0:18:47.241 maybe set me up for people to immediately swap me 0:18:47.281 --> 0:18:50.521 down as having a bad attitude, was I don't want 0:18:50.561 --> 0:18:53.601 to be saving so hard for retirement that I can 0:18:53.641 --> 0:18:55.921 look back and luxury and a life that I haven't lived. 0:18:56.641 --> 0:19:02.841 Yes, I think it does. It's really really well some time. 0:19:04.281 --> 0:19:07.361 You know, it's a trade off, it's a balance, it's 0:19:07.401 --> 0:19:09.961 what we're comfortable with. I don't think there's any rule 0:19:10.001 --> 0:19:13.001 of thumb or anything like that. It's a trade off 0:19:13.121 --> 0:19:18.561 between the present and the future. The present getting yourself 0:19:18.601 --> 0:19:21.481 into a strong financial position, maybe having no death or 0:19:21.481 --> 0:19:26.041 at least very little dere the future in terms of 0:19:27.561 --> 0:19:32.081 savings and such like. So, I mean, you can you know, 0:19:32.121 --> 0:19:36.881 I know people who have spent their berty paying off 0:19:36.921 --> 0:19:39.361 their mortgage and getting themselves into a very strong position. 0:19:39.401 --> 0:19:41.681 They can live the rest of their life mortgage free. 0:19:41.841 --> 0:19:43.881 They've probably got a bit of income from other sources, 0:19:43.881 --> 0:19:46.441 they can work part time. That kind of thing. They 0:19:46.481 --> 0:19:49.721 pay a big price for that, and the price they 0:19:49.761 --> 0:19:54.841 pay is lifestyle. Now I'm having a pretty good lifestyle 0:19:54.881 --> 0:19:58.481 at the moment because although I work, you know, I'm 0:19:58.521 --> 0:20:01.401 not working full time or anything like that. And so 0:20:01.481 --> 0:20:06.601 I'm going to the likes of France or Italy this 0:20:06.801 --> 0:20:10.001 year probably to go climb and to go rock climbing, 0:20:10.041 --> 0:20:13.441 or to go mountain mountain, mountaineeric. But you know, I mean, 0:20:14.241 --> 0:20:16.841 excuse me. I made it through to them. Some people 0:20:16.881 --> 0:20:20.401 don't make it through through, you know, to their health, 0:20:20.441 --> 0:20:23.241 and then they can no longer. I can still carry 0:20:23.281 --> 0:20:26.841 on during mountaineering rock climbing on my seventies. A lot 0:20:26.841 --> 0:20:27.961 of people wouldn't be able to. 0:20:28.721 --> 0:20:31.241 Yeah, I think because I think that that's ultimately when 0:20:31.281 --> 0:20:34.641 it comes to questions we can all relate to, whether 0:20:34.921 --> 0:20:37.601 it comes to money and finances, is what trade off 0:20:37.601 --> 0:20:41.401 are you prepared to make? And I mean, look, I've 0:20:41.401 --> 0:20:44.601 been a musician for I was a freelance musician for 0:20:44.641 --> 0:20:47.081 quite a few years, and that is a tough way, yes, 0:20:47.361 --> 0:20:50.321 financially that there is a major sacrifice that comes. Until 0:20:50.361 --> 0:20:53.641 I could have stayed practicing law, and who knows, but 0:20:53.761 --> 0:20:56.321 I would have looked back and there's a certain element 0:20:56.361 --> 0:20:59.081 that in my poverty. I do feel pretty good about 0:20:59.121 --> 0:21:02.401 the choices I've made, because ultimately life is for living. 0:21:02.441 --> 0:21:05.361 But it is it's a constant I don't know how 0:21:05.361 --> 0:21:07.881 many people wrestle with this, and I would imagine everyone does, 0:21:07.961 --> 0:21:11.481 doesn't it, Because you see people who seem to seamlessly 0:21:11.521 --> 0:21:15.041 make a decision to, you know, really aggressively attack their 0:21:15.081 --> 0:21:17.081 finances and get on top of it and things, and 0:21:17.161 --> 0:21:19.761 it always feels like it's effortless for them. But when 0:21:19.841 --> 0:21:21.481 you talk to them and go, oh, well, you know, 0:21:21.721 --> 0:21:24.281 I wish I'd done X, Y and Z, and instead 0:21:24.321 --> 0:21:27.761