Money Yarn #1: Sarah

Sarah is a teacher and single mum with four children at home. Her oldest lives out of home (and owns his own home at only 20!). She’s in the process of buying her own home after a separation. She’s trying to decide whether to buy her ex out of their family home or buy a completely different place to raise the kids. Sarah has recently made huge progress toward paying off her debts and bettering her financial situation. This is a snapshot of where she’s at.

Name: Sarah.

Location: Wairarapa.

In my household there is: Me and my four children, aged 16, 14, 13, and 5.

Income: My income comes from three different sources. I recently became a fully registered teacher, earning $61,794 per year. That’s about $2377 per fortnight before tax. Each fortnight I also get $666 in Working For Families tax credits, and a significant amount in child support too.

Essential expenses: My mortgage is $725 per fortnight. My insurances and utilities come to around $400 per month. Groceries are $250 per week. Transport-wise, if I’m borrowing my daughter’s car, I only spend about $20 per week on petrol, cause she chips in too. If I’m driving my big people mover, that’s about $70 - $80 per week. Sometimes I use my e-scooter to get to work!

Non-essential expenses: The gym is important to me, and that’s $19 per week. I also have a Patreon subscription which is $9 per month. We have Netflix too, and Spotify comes with our phone bill. Occasionally, I’ll go out for a drink with my teaching colleagues if the day has been particularly long!

Debt: If this was a few months ago, this would have been a very different story! Right now I only have my student loan ($60,000) and the mortgage with my ex. Due to my separation a few years back, I ended up with credit card debt that was taken to Baycorp. I was just trying to survive and look after my kids at the time. I’ve since cleared all that debt (roughly $5,000), as well as a $500 overdraft that (just finished paying off last week!), and $200 on a Gem Visa card too. Wanting to get my own mortgage after my separation was the big push I needed to get rid of it all. The past few months of aggressively paying off debt were hard. Some weeks we wouldn’t go grocery shopping just so that I could make extra payments. We’d get creative and eat whatever was lurking in the pantry and freezer. It was tricky, but well worth it.

Savings: I was building my savings, but then typically, my teaching practicing certificate was due! This costs $520 for three years and used up all my savings. It’s necessary though because I can’t teach without it. Due to the latest negotiations, however, this $520 might be paid back to me.

Investments: My KiwiSaver is currently sitting at around $15,000. I’ve only been contributing to it for the last two to three years while I’ve been teaching.

What would you do if you needed money in an emergency: I hate to say this, but I’d probably ask my 16-year-old for a hand. She works two jobs with 40 - 50 hours a week between them. She’s an amazingly hard worker and saver, having just bought her first car.

How would you describe your financial situation: Honestly, I feel positive about it for the first time in my whole life. I’m more aware of my finances now. I used to live with my head in the sand, hoping that the money would just come from somewhere! During the last few months, I came to the realisation that this was unsustainable, and I couldn’t keep living like this. My ex also wanted to sort out the house situation, so I knew it was time to buckle down and sort out getting a home in my own name. I’ve also started building up my Christmas savings and my “play” account too. Putting $10 - $20 aside each pay cycle means that it won’t be super stressful when the time comes.

Do you feel in control of your finances: Yes! For the first time ever.

Do you worry about money: Yes. Not about paying bills anymore, but more about making it work to buy my own home. The financial side of that has got me stretched. I just want to make sure my kids have a decent roof over their heads. Money will come and go, as it has throughout my life. But at the end of the day, it is all down to me. I don’t have any family support, so I have to be self-reliant.

Do you have any regrets money-wise: Yes. I regret not getting in control of it sooner. I’m almost 38, so I feel like I should have had control over it much earlier.

What was money like growing up: My mum was a single mum who worked a lot. As a solo mum now, I appreciate how hard she worked for us - she was lucky enough to have my Nana (her mum) living next door, and Nana supported us a lot too.

Toughest financial situation: When I had to go onto a benefit just to survive and feed my kids. The moment when I realised that everyone was relying on me. That I had to provide for everyone. How the fuck was I going to feed everyone? I had $5 to my name. I was studying at the time and the stress in my personal life made me end up completing the degree over two years instead of one. This pushed my earning back another year. It was really stressful, but I’m glad I pushed through as it got me to where I am today.

Proudest financial moment: Honestly, right now! Feeling on top of things and knowing that soon I’ll have my own home with just my name on the title. Knowing that it’s just me who has made this happen for my kids.

Best financial advice: Don’t be afraid to ask for help if you’re in a tough spot. There is help available. Put your pride aside and do what you need to do.

How do you think most other Kiwis are doing financially: Fucking tight, with the cost of living and all. I don’t blame the government or Covid-19 or anything. I reckon we aren’t taught how to stretch a dollar or put money away “just in case”. That combined with the cost of living crisis means that it’s really hard for most right now.

Where do you want to be financially: I’d like to own my own home (happening soon!) and be able to take my kids on holiday. I’d love to take them to the Coromandel, where I used to go on holiday as a kid. I have everything we need to go camping, it just comes down to the cost of petrol and the campground. Basically, I’d like to be in a position where I can just do whatever I want to do. Take the kids to the zoo for the day and not have to give it a second thought.