RNZ's money correspondent Susan Edmunds. Photo: RNZ
Send your money questions to susan.edmunds@rnz.co.nz.
I fixed my home loan earlier this year, for three years at what looked at the time like a good rate. Now that rates are dropping, I'm regretting my decision. Should I break my fixed term to refix?
If you decide to break your fixed term, you will usually pay a break fee.
This can vary, but is based on what term you signed up for, the rate that you agreed to pay, and what rate the bank could lend the money to another borrower for now.
The further rates fall from the rate you fixed at, the larger your break fee is likely to be.
Sometimes, people decide it is not worth trying to break and refix because the break fee can sometimes be about as much as the interest you might save.
If you fixed your home loan for three years at the highest point of the most recent cycle, you might be paying about 6.7 percent. If you were to refix now, you could get a rate a percentage point or so lower.
At 6.7 percent, a monthly repayment on a $500,000 mortgage over 30 years is about $3227. If you were fixed at 5.7 percent, it would be about $2903.
That means refixing at that rate now might save you about $10,000 if you have about two-and-a-half years left to run on your loan.
But interest.co.nz's calculator indicates that you could be looking at a break fee of more than $13,000.
However, brokers say it can vary a lot and they have to get pricing on a case-by-case basis.
It's a good idea to get advice from your bank or a mortgage adviser. Sometimes banks offer incentives such as cash back to entice new business, and in some situations you might be able to access a sweetener like that to offset the cost - but it needs to be done carefully.
I'm worried that I'm going to be made redundant but I've just bought a first home. Can I get insurance to help?
Probably not. There is redundancy insurance available but it tends to be quite limited.
It is usually available as an add-on to income protection or mortgage and rent cover, and there is usually a stand-down period that means you cannot claim within the first six months or so.
Sometimes there is also a provision that means that if you had an indication that redundancy was possible before you took out the insurance, you cannot claim.
Income protection and mortgage and rent cover can be really good options to protect you if you're off work due to a health event, but they aren't really designed to help with redundancy.
The best option is probably to try to do what you can to build up a bit of a savings buffer now. If you have a partner who has a job it is unlikely that you'll be able to access Jobseeker Support - once a household earns more than $160 a week, the benefit available reduces at a rate of 70 cents per dollar earned.
If you have children, you may find you can access help via Working for Families if your household income drops in a sustained way.
If your employer offers an EAP programme, you may be able to access financial coaching to help you through your options, or you could contact a financial mentor for help.