Diana Crossan

Kiwis should take time to review their own financial situation rather than being spooked by the debate surrounding today's Official Cash Rate (OCR) announcement, according to the Retirement Commissioner.

Reserve Bank Governor Alan Bollard has announced that the OCR remains unchanged despite banks speculating that a more immediate increase would occur.

Retirement Commissioner Diana Crossan says record inflation along with high petrol and food prices are putting increased pressure on household budgets.

"It's easy to be rattled by all the doom and gloom talk, and to feel alarmed by inflation fluctuations and talk of upcoming OCR increases. But the way to deal with the uncertainty is to take control of your own finances.

"If the OCR rises later in the year it could lead to an increase in mortgage interest rates but it's only going to affect you if you have a floating interest rate or your fixed term mortgage is expiring soon. So, if that's you, take a look at what a rise in interest rates will actually cost you and how that fits with your spending plan. That way you'll be prepared if, and when, interest rates do rise.

"Sorted's mortgage calculators on sorted.org.nz make this comparison easy. Mortgage holders may find that a rise in interest rates, while not welcome, can be managed," she says.

Ms Crossan is urging people to take charge of their financial planning so that changes in the economy don't catch them out.

"No matter how much money you have, everyone can benefit from a spending plan. Make sure you understand how much money is coming in and how much is going out. Take charge so that you remain in control," she says.

Mortgage holders can check the impact of interest rates changes by using the mortgage calculators <http://www.sorted.org.nz/calculators/mortgages> at sorted.org.nz.