Presentation to CBNZ – August 2009 Things the banks don’t want your clients to know.

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Presentation transcript:

Presentation to CBNZ – August 2009 Things the banks don’t want your clients to know.

Presentation to CBNZ – August 2009 Things the banks don’t want your clients to know. Three unbreakable rules. What the banks don’t want you to know. Saving money at the bank. Why your client can’t get a bank loan. Contract truths. Questions?

Three basic principles: 1] Avoid going into debt. 2] Pay off existing debt as quickly as possible. 3] Set goals and save for them.

The basic principle – pay of more than the minimum monthly amount. If you owe $5000 on your credit card... With no fees and 20% interest... And you add nothing more to the card...

If you owe $5000 on your credit card... With no fees and 20% interest... And you add nothing more to the card... $25$50$100$125 9 years and 1 month. $5, in interest.

If you owe $5000 on your credit card... With no fees and 20% interest... And you add nothing more to the card... $25$50$100$125 9 years and 1 month. $5, in interest. 2 years and 9 months. $1, in interest.

If you owe $5000 on your credit card... With no fees and 20% interest... And you add nothing more to the card... $25$50$100$125 9 years and 1 month. $5, in interest. 2 years and 9 months. $1, in interest. 1 year and 3 months. $ in interest.

If you owe $5000 on your credit card... With no fees and 20% interest... And you add nothing more to the card... $25$50$100$125 9 years and 1 month. $5, in interest. 2 years and 9 months. $1, in interest. 1 year and 3 months. $ in interest. 1 year. $ in interest.

Three basic principles: 1] Avoid going into debt. 2] Pay off existing debt as quickly as possible. 3] Set goals and save for them.

Presentation to CBNZ – August 2009 Things the banks don’t want your clients to know. Three unbreakable rules. What the banks don’t want you to know. Saving money at the bank. Why your client can’t get a bank loan. Contract truths. Questions?

7 Things Your Bank Will Never Tell You (Consumer Magazine Jan/Feb 2006, Issue 455, Page 23) 1. Your bank wants you to overspend.

7 Things Your Bank Will Never Tell You (Consumer Magazine Jan/Feb 2006, Issue 455, Page 23) 1. Your bank wants you to overspend. 2. A bank’s review of your account is really a sales pitch.

7 Things Your Bank Will Never Tell You (Consumer Magazine Jan/Feb 2006, Issue 455, Page 23) 1. Your bank wants you to overspend. 2. A bank’s review of your account is really a sales pitch. 3. Banks prefer not to inform you of saving’s rate increases.

7 Things Your Bank Will Never Tell You (Consumer Magazine Jan/Feb 2006, Issue 455, Page 23) 1. Your bank wants you to overspend. 2. A bank’s review of your account is really a sales pitch. 3. Banks prefer not to inform you of saving’s rate increases. 4. Bouncing cheques are good for your bank’s business so long as you don’t do it too often.

7 Things Your Bank Will Never Tell You (Consumer Magazine Jan/Feb 2006, Issue 455, Page 23) 1. Your bank wants you to overspend. 2. A bank’s review of your account is really a sales pitch. 3. Banks prefer not to inform you of saving’s rate increases. 4. Bouncing cheques are good for your bank’s business so long as you don’t do it too often. 5. You can pay your entire credit card bill off by direct debit (or can get a debit card).

7 Things Your Bank Will Never Tell You (Consumer Magazine Jan/Feb 2006, Issue 455, Page 23) 1. Your bank wants you to overspend. 2. A bank’s review of your account is really a sales pitch. 3. Banks prefer not to inform you of saving’s rate increases. 4. Bouncing cheques are good for your bank’s business so long as you don’t do it too often. 5. You can pay your entire credit card bill off by direct debit (or can get a debit card). 6. Bank advice may be self-interested.

7 Things Your Bank Will Never Tell You (Consumer Magazine Jan/Feb 2006, Issue 455, Page 23) 1. Your bank wants you to overspend. 2. A bank’s review of your account is really a sales pitch. 3. Banks prefer not to inform you of saving’s rate increases. 4. Bouncing cheques are good for your bank’s business so long as you don’t do it too often. 5. You can pay your entire credit card bill off by direct debit (or can get a debit card). 6. Bank advice may be self-interested. 7. Service fees don’t necessarily match the cost.

Presentation to CBNZ – August 2009 Things the banks don’t want your clients to know. Three unbreakable rules. What the banks don’t want you to know. Saving money at the bank. Why your client can’t get a loan. Contract truths. Questions?

How to Save Money at Your Bank 10 tips to remember 1. Get the right accounts - make sure they match your needs.

How to Save Money at Your Bank 1. Get the right accounts - make sure they match your needs. 2. Avoid going to the bank – use internet banking it’s cheaper. 10 tips to remember

How to Save Money at Your Bank 1. Get the right accounts - make sure they match your needs. 2. Avoid going to the bank – use internet banking it’s cheaper. 3. Don’t overdraw your accounts – it will cost you. 10 tips to remember

How to Save Money at Your Bank 1. Get the right accounts - make sure they match your needs. 2. Avoid going to the bank – use internet banking it’s cheaper. 3. Don’t overdraw your accounts – it will cost you. 4. You should have a free transaction account if you are a student, retiree or mortgage holder. 10 tips to remember

How to Save Money at Your Bank 1. Get the right accounts - make sure they match your needs. 2. Avoid going to the bank – use internet banking it’s cheaper. 3. Don’t overdraw your accounts – it will cost you. 4. You should have a free transaction account if you are a student, retiree or mortgage holder. 5. If you have a big term deposit/savings ask how they will reward you. 10 tips to remember

How to Save Money at Your Bank 6 Don’t pay interest on your credit card – pay it off immediately. 10 tips to remember

How to Save Money at Your Bank 6 Don’t pay interest on your credit card – pay it off immediately. 7. Use only your own banks ATM machines or it will cost you. 10 tips to remember

How to Save Money at Your Bank 8. Make sure you know how your bank charges fees. 10 tips to remember 6 Don’t pay interest on your credit card – pay it off immediately. 7. Use only your own banks ATM machines or it will cost you.

How to Save Money at Your Bank 8. Make sure you know how your bank charges fees. 9. Consolidate your debts wherever possible. 10 tips to remember 6 Don’t pay interest on your credit card – pay it off immediately. 7. Use only your own banks ATM machines or it will cost you.

How to Save Money at Your Bank 8. Make sure you know how your bank charges fees. 9. Consolidate your debts wherever possible. 10. Check your statements for mistakes – banks do sometimes make them. 10 tips to remember 6 Don’t pay interest on your credit card – pay it off immediately. 7. Use only your own banks ATM machines or it will cost you.

Presentation to CBNZ – August 2009 Things the banks don’t want your clients to know. Three unbreakable rules. What the banks don’t want you to know. Saving money at the bank. Why your client can’t get a bank loan. Contract truths. Questions?

Why your client can’t get a bank loan. Your client needs to be the type of customer the bank wants. To be such a person you need a strong S-E-C. Serviceability Equity Character Bank loans are not automatic these days. Banks are businesses and want a profit.

Why your client can’t get a bank loan. Serviceability = your ability to service debt. wages, salary, benefits and family tax credits etc. interest earned, dividends, rental income, boarder income, etc. Takes into account your total income:

Why your client can’t get a bank loan. Equity = your total assets less your liabilities. Cash – savings, term deposits. Property – Loan to Value Ratio (LVR). Other assets: cars, shares, investments etc. Takes into all you own and all you owe:

Why your client can’t get a bank loan. Character = your total reputation. Credit history. Defend this with all your might:

Why your client can’t get a bank loan. Character = your total reputation. Credit history. Account conduct. Defend this with all your might:

Why your client can’t get a bank loan. Character = your total reputation. Credit history. Account conduct. Loan repayment history. Defend this with all your might:

How to get the best out of your bank Character = your total reputation. Credit history. Account conduct. Loan repayment history. Employment history. Defend this with all your might:

How to get the best out of your bank Character = your total reputation. Credit history. Account conduct. Loan repayment history. Employment history. Education. Defend this with all your might:

Presentation to CBNZ – August 2009 Things the banks don’t want your clients to know. Three unbreakable rules. What the banks don’t want you to know. Saving money at the bank. Why your client can’t get a loan. Contract truths. Questions?

A word about contracts. Break fees. A contract is a contract......but nobody actually reads them!!

A word about contracts. Interest free. Interest deferred. Nothing to pay for 6 months. 24 month interest free.

A word about contracts. Interest free. 24 month interest free. Usually contains a large admin. fee and beware if you miss a payment....and sometimes it’s designed to ‘help’ you miss a few!

A word about contracts. Nothing to pay for 6 months. 24 month interest free. After six months – very high interest rate and beware if your circumstances change.

Presentation to CBNZ – August 2009 Things the banks don’t want your clients to know. Three unbreakable rules. What the banks don’t want you to know. Saving money at the bank. Why your client can’t get a loan. Contract truths. Questions?

Presentation to CBNZ – August 2009 Things the banks don’t want your clients to know.