It’s coming up to that time of year again for Auckland households: Entrust dividends.
Most households across the city receive the late September payout, and many of us are quick to spend the extra cash to treat ourselves. After the cold winter, it can feel good to have the surplus to splurge on a nice dinner out, a new gadget, or maybe some new clothes for the changing season.
There’s nothing wrong with that. But before this year’s dividend disappears into your everyday spending, it’s worth taking a moment to ask: what else could this money do?
Why We Treat Windfalls Differently
Across the board, people tend to think about the money we earn differently from the money that shows up through other sources. Whether it’s a tax refund, dividend, a work bonus, or a lottery win, “unexpected money” is the money that most often disappears without us noticing.
There’s a name for this phenomenon: mental accounting. We factor the money we’ve worked hard for into our budget, carefully allocating it to rent, bills, groceries, and savings. Money that feels like a windfall gets filed under “bonus cash.” As a result, it somehow feels less real. We spend it without much thought and barely notice when it’s gone.
What Could This Year’s Dividend Really Be Worth?
Due to the very nature of unexpected money, chances are that you haven’t planned ahead for this year’s payout. If, instead of the usual reflex spend, you were to plan for your dividend, what would that look like?
Your dividend payment could be an extra boost to your emergency fund or help you reduce a pesky credit card balance. It could top up your KiwiSaver account or go towards a future holiday, so you’re sorted when the time comes. Or it could sit in a mortgage offset account, quietly reducing the interest on your home loan.
These might not seem as exciting as a luxury splurge. But they’re the kind of decisions that compound over time, long after the latest gadget has worn out or been forgotten.
The Best Spending Decision Isn’t Always Saving It
This isn’t about guilt-tripping yourself into saving every dollar you get. There isn’t a one-size fits all answer for what to do with your dividend. Splashing out on the odd treat isn’t a bad thing, and spending isn’t the enemy.
The real question is: does this use of this money align with what’s important to you?
It might fund a family experience that creates a memory worth keeping. It might help finally pay down a debt that’s been on your mind. It might go towards a hobby that makes you happy. All of these can be the right use of your dividend, as long as your choice adds to your life, instead of taking away from it.
What Would Future You Choose?
If you aren’t sure whether to save or splurge, put yourself in the shoes of your future self. In 12 months’ time, would you remember what you bought with this year’s dividend? Would putting it into your savings make more of an impact? What about in 5 years? You might have purchased something that changed your quality of life, or funded an irreplaceable experience. Or you might appreciate seeing real progress, having the flexibility of a bigger emergency fund or the freedom of a smaller mortgage.
The choice isn’t about denying yourself something nice today. One off purchase or long-term investment, what matters is being honest with yourself about what you’ll actually value later.
Turning One Dividend Into Momentum
As exciting as a windfall can be, the Entrust dividend is just one payment. It won’t change your financial future. It’s the habits and decisions it inspires in you that might.
This is where an enable.me financial coach can help. Our coaches aren’t here to tell you what to do with the odd windfall, but to help you step back and see the bigger picture They work with you to identify where your money is going, what you want your future to look like, and how small, intentional decisions can build toward that.
Coaching helps you spot the opportunities you might not see on your own. It provides support for you to create a financial plan that you can follow through on, rather than relying on motivation alone.
What could this year's Entrust Dividend do for your future?
Book a Financial Consultation and discover how small decisions today can create greater financial freedom tomorrow.
