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Three Smart Money Moves After Buying Your First Home · That Home Loan Hub

• 0:10
  SPEAKER_00: Hello and welcome back to that Homlon hub.
• 0:13
  SPEAKER_00: Hello, Kunj.
• 0:16
  SPEAKER_00: That was a bit of a pose.
• 0:18
  SPEAKER_00: Kunch today, picture this.
• 0:20
  SPEAKER_00: We've got a client.
• 0:22
  SPEAKER_00: They bought a house.
• 0:24
  SPEAKER_00: All exciting.
• 0:24
  SPEAKER_00: Mm-hmm.
• 0:25
  SPEAKER_00: They've got the keys.
• 0:26
  SPEAKER_00: They're moving.
• 0:27
  SPEAKER_00: Mm-hmm.
• 0:27
  SPEAKER_00: What happens then?
• 0:29
  SPEAKER_00: Yeah.
• 0:30
  SPEAKER_01: Let's talk about that.
• 0:31
  SPEAKER_01: Let's talk about what happens after.
• 0:33
  SPEAKER_01: Or like a couple key things to think about after you buy your first home.
• 0:39
  SPEAKER_01: Alright.
• 0:39
  SPEAKER_01: Um, so one thing I thought about was your Kiwi Saver.
• 0:44
  SPEAKER_01: So you've used up your Kiwi Saver to purchase your first home as your deposit.
• 0:50
  SPEAKER_01: Now you can't touch it anymore until you're 65.
• 0:53
  SPEAKER_01: Yeah.
• 0:53
  SPEAKER_01: So imagine you're, you know, early 30s and now you've got another 35 years of Kiwi Saver.
• 1:00
  SPEAKER_01: What do you do with it?
• 1:01
  SPEAKER_01: So it's a good time to review the fund you're in.
• 1:05
  SPEAKER_01: This is not financial advice because I'm not a KiwiSaver expert, but good time to, you know, review the fund because when you're using it to buy your first home, you're there's genuinely a first home buyer fund that most providers have.
• 1:20
  SPEAKER_00: Which is non-aggressive, correct?
• 1:22
  SPEAKER_00: Usually, you know, low risk because you don't want to risk losing your whole deposit if you're about to buy a house.
• 1:28
  SPEAKER_00: So normally you would be on a low risk profile, but it wouldn't generate you as much return.
• 1:34
  SPEAKER_00: But once you bought a house, then you could reconsider what sort of fund you in.
• 1:39
  SPEAKER_00: Yeah.
• 1:39
  SPEAKER_00: Awesome.
• 1:40
  SPEAKER_01: Yeah, so just to reconsider that and just make sure that you know it's working the way you want it to work.
• 1:46
  SPEAKER_00: Interesting.
• 1:46
  SPEAKER_00: Yeah, I don't think a lot of people think of that.
• 1:48
  SPEAKER_00: No.
• 1:49
  SPEAKER_00: Okay, cool.
• 1:51
  SPEAKER_00: Number two.
• 1:51
  SPEAKER_00: Number two.
• 1:52
  SPEAKER_01: Number two, uh obviously you have to have home insurance, right?
• 1:58
  SPEAKER_01: When you buy your home.
• 1:59
  SPEAKER_01: Absolute must.
• 2:00
  SPEAKER_01: It's a must.
• 2:01
  SPEAKER_01: It's a condition of the banks or the lenders as well to have insurance.
• 2:06
  SPEAKER_01: But have you got insurance for yourself?
• 2:09
  SPEAKER_00: So that's what.
• 2:10
  SPEAKER_00: Hold on.
• 2:11
  SPEAKER_00: What wait.
• 2:12
  SPEAKER_00: What is insurance for yourself?
• 2:13
  SPEAKER_00: What does it mean?
• 2:14
  SPEAKER_01: Well, let's just say if something happens to you, right?
• 2:18
  SPEAKER_01: You get sick or something and you're not able to work, you're not able to earn an income, that income is to pay for that loan.
• 2:25
  SPEAKER_01: ACC will cover me.
• 2:26
  SPEAKER_01: Yeah, ACC will cover for accidents.
• 2:28
  SPEAKER_01: So just to point that, ACC, if you have an accident, they'll cover 80%.
• 2:33
  SPEAKER_01: But if you get sick, they're not going to cover you.
• 2:36
  SPEAKER_00: Yeah, absolutely.
• 2:37
  SPEAKER_00: And this is something really important to note because look, me as an insurance advisor, when I talk to my clients and I talk to them about the importance of having income protection, mortgage protection, we often get that response.
• 2:48
  SPEAKER_00: ACC will cover me.
• 2:50
  SPEAKER_00: ACC will not cover you if you've got cancer.
• 2:52
  SPEAKER_00: Yeah.
• 2:53
  SPEAKER_00: If you just you know had cancer as a result of um sun exposure, for instance.
• 3:00
  SPEAKER_00: You know, that's not an ACC related topic.
• 3:03
  SPEAKER_01: No.
• 3:03
  SPEAKER_01: Yeah, so sickness more.
• 3:07
  SPEAKER_01: So so then um, yeah, imagine you know, you um have an asset that's close to a million dollars that you probably have a debt of 80 to 90 percent, and you get sick and you can't pay it.
• 3:21
  SPEAKER_01: That'd be pretty crap if you had to sell that asset after you work so hard for it.
• 3:27
  SPEAKER_01: So, yeah, it's to think about having some life insurance, income protection, and we have amazing insurance advisors around that can help you.
• 3:38
  SPEAKER_00: Yeah, so apart from me as an insurance advisor, we also have a fantastic team member, Rebecca.
• 3:43
  SPEAKER_00: She's joined our crowd a few months ago.
• 3:45
  SPEAKER_00: If you've missed an episode with me and Rebecca, you know, go a few episodes ago, search for it.
• 3:49
  SPEAKER_00: We've covered some important topics there.
• 3:51
  SPEAKER_00: But yeah, absolutely something to think about when you buy a house is get that insurance reviewed.
• 3:57
  SPEAKER_00: If you already have something in place, fantastic, but get it reviewed.
• 4:00
  SPEAKER_00: If you don't have anything at all, you should be getting something.
• 4:02
  SPEAKER_00: Yeah.
• 4:03
  SPEAKER_00: Because you never know what's around the corner.
• 4:05
  SPEAKER_00: Yeah.
• 4:05
  SPEAKER_01: And then point three, I thought I'll just do three points.
• 4:09
  SPEAKER_01: Point three, obviously, when you buy a house, we recommend that you have some cash set aside, right?
• 4:15
  SPEAKER_01: Like to pay for the registered valuation and um lawyers' fees and things like that.
• 4:20
  SPEAKER_01: After buying the house, I yeah, recommendation is also to have that at least two mortgage repayments saved, tucked away in a rainy day account, sort of thing.
• 4:32
  SPEAKER_01: That just gives you a bit of leverage in case there's a glitch or something in terms of your pay, or if you like went on a holiday and you're like, oh, actually, I want to skip that mortgage payment, but because I've got you know two pay saved, sort of thing.
• 4:48
  SPEAKER_00: Wow, you're very kind to them.
• 4:50
  SPEAKER_00: You're saying two.
• 4:51
  SPEAKER_00: Oh, yeah.
• 4:52
  SPEAKER_00: I usually say, I usually say three months.
• 4:54
  SPEAKER_00: You should have a buff off at least three months.
• 4:56
  SPEAKER_00: And I'll tell you the reason why I said that.
• 4:58
  SPEAKER_00: Because again, with insurances, when you get a mortgage insurance, you've got a stand down period.
• 5:03
  SPEAKER_00: And you can wait either four weeks, eight weeks, or 13 weeks for the insurance to kick off paying.
• 5:09
  SPEAKER_00: If you wait four weeks, your insurance is usually more expensive.
• 5:11
  SPEAKER_00: If we wait eight weeks, it's a bit cheaper.
• 5:13
  SPEAKER_00: 13 weeks, even cheaper.
• 5:14
  SPEAKER_00: So normally I say if you have at least three months buffer for your mortgage protection, for your mortgage repayments, and then mortgage protection kicks in, that's usually a good balance to have.
• 5:25
  SPEAKER_00: So, yeah, absolutely.
• 5:26
  SPEAKER_00: Calculate what your repayments mine was two pays, so yeah, when you go on holiday, not when you get sick.
• 5:33
  SPEAKER_00: Yeah, so if we stuck with at least two to three months, so two repayments to three months repayments, you guys will be in a very safe way.
• 5:42
  SPEAKER_00: So the way you, you know, worked hard and saved that money for your first home deposit, you know you can do this again.
• 5:49
  SPEAKER_00: So go a little bit hard, you know, skip on those takeaways, skip on those coffees, put the money aside because again, you just don't know what's gonna happen.
• 5:56
  SPEAKER_00: You know, we had a client that bought a house, the water tank blew up.
• 5:59
  SPEAKER_00: We had a client that bought a house and discovered holes in the roof, you know.
• 6:03
  SPEAKER_00: So all sorts of things can happen and you need extra buffers.
• 6:07
  SPEAKER_00: So don't spend all of your money as a deposit.
• 6:10
  SPEAKER_00: And this is where, you know, we try to usually pull you back and go, don't be emotional, don't buy the house with emotion because you will overspend it.
• 6:18
  SPEAKER_00: Correct.
• 6:19
  SPEAKER_00: Yeah, awesome.
• 6:20
  SPEAKER_00: I really love your three points.
• 6:21
  SPEAKER_00: This is great.
• 6:22
  SPEAKER_00: Okay, do a quick recap of just the subject line.
• 6:26
  SPEAKER_00: Three points.
• 6:26
  SPEAKER_00: Go.
• 6:27
  SPEAKER_01: Okay, three points.
• 6:28
  SPEAKER_01: Review your Kiwi Saver.
• 6:29
  SPEAKER_01: Done.
• 6:30
  SPEAKER_01: Make sure you have some sort of protection for yourself, so life insurance, and then have some buffer in your savings account.
• 6:38
  SPEAKER_00: Love it, absolutely love it.
• 6:39
  SPEAKER_00: Awesome.
• 6:39
  SPEAKER_00: Thank you, Kunch, so much.
• 6:41
  SPEAKER_00: And for those that have missed, Kunch and I actually did a whole entire season of episodes on how to buy your first home.
• 6:48
  SPEAKER_00: And this is a sort of a more of a catch on on to that, if what happens after.
• 6:52
  SPEAKER_00: So if you are looking to buy your first home, don't worry, there are episodes for you.
• 6:56
  SPEAKER_00: So just go back a little bit behind and have a listen.
• 6:59
  SPEAKER_00: Search through those hundred hundreds of episodes that we've done.
• 7:02
  SPEAKER_00: Use the keywords.
• 7:04
  SPEAKER_00: Use the keywords.
• 7:05
  SPEAKER_00: Awesome.
• 7:05
  SPEAKER_00: Thank you guys so much and talk soon.
• 7:07
  SPEAKER_00: Thanks.
• 7:08
  SPEAKER_00: Bye.
• 7:08
  SPEAKER_00: Bye.