Is a 72 year old widower who lives in his own home. With the drop in investment rates, the income from Cliff’s $150,000 term deposit has halved and he is now struggling to keep up with the bills.

Unfortunately Cliff’s adult children live overseas, so they are not able to help with the house which badly needs painting. He is also worried about upcoming dental bills.

Cliff called in to his local ASB branch and spoke to a Personal Banker, who helped him come up with a plan.

Cliff's Plan

1. Financial Snapshot
Get a clear picture of your finances by filling out a My Finances Form.

2. Reduce expenditure
Review bank statements to see where non-essential spending can be cut.

3. Make a budget
Budget how much money you expect to receive and how you will spend it. Start with essential payments then work out how much you have left for discretionary items.

4. New sources of income
Talk to your bank about different investment options.

5. Free up capital
Consider downsizing to a smaller, lower maintenance property now the family has moved overseas.

6. Pay in instalments
Negotiate to pay large bills in more affordable weekly instalments.

How Cliff implemented the plan

After doing a budget, Cliff decided to sell his home and downsize as there were few other ways he could keep up with the hefty maintenance bills for his current home.

Cliff found a smaller house and section which is easier to maintain and cheaper to heat. This freed up $100,000 in capital, which means he has more to invest, offsetting his lower current investment income.

After speaking to one of ASB’s Investment Advisers, Cliff put his funds into investment grade bonds, which returned fixed interest at a higher rate than a term deposit.

He also talked to his dentist and arranged to pay for his dental work in monthly instalments.

My financial stress has eased considerably and I now feel like I can stop worrying and get on with enjoying life.