Poor choices making KiwiSavers worse off
Posted in Kiwisaver on
The latest KiwiSaver fund updates show that scheme members are probably leaving hundreds of thousands of dollars on the table because of their conservative approach to investing. New Zealanders scour the web looking for the cheapest clothes, airline tickets, hotels and electricity deals but this low-cost approach may backfire when it comes to KiwiSaver because the lowest-fee funds have generally delivered the lowest returns in recent years. This low-fee strategy could be costing investors $100,000 or more on retirement.
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Can you afford to retire without a house?
Posted in Retirement, Savings on
For decades, the path to a comfortable retirement for middle-income Kiwis had three key steps: buy a house, pay it off before retiring, and save hard for as long as possible to amass a decent nest egg. But soaring home prices are making it harder to get on the property ladder, putting at risk the first step in that well-trod plan.
View moreThe Truth About Earnings and Stock Valuations
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We thought this article on Bloomberg was interesting and backs up our philosophy that you should never rely on just one methodology when valuing a stock.
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1 in 3 Americans have $0 saved for retirement
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Saving for retirement is not an area of financial strength for Americans. Too often, meeting the financial demands of today means delaying, diminishing or simply never starting to save for tomorrow. “There are plenty of obstacles Americans claim are in their way when it comes to saving for retirement: credit card debt, student loan debt, low wages, the need to save for a child’s college education, and the list goes on,” said Cameron Huddleston, Life + Money columnist for GOBankingRates. “Although all of these things can put a strain on our budgets, they don’t necessarily make it impossible to save for retirement.”
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Ancient Greek money lessons
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OPINION: Let me tell you a story about an ancient Greek hero who can help you get richer. It's Ulysses, a kind of Greek Maui, though without Maui's ambition, and with a much worse sense of direction. Ulysses was one of the Greeks who destroyed the ancient city of Troy, and then got hopelessly lost sailing home.
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How to save a first-home deposit
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The deposit required to buy a house in many parts of New Zealand looks more like a Lotto win than an amount you might save. In Auckland, the lower-quartile house price is about $680,000. That means, if you want a 20 per cent deposit, you will need $136,000. In Christchurch, first-home buyers need to save about $75,000 and in Wellington City, just under $100,000. So, how do you get there?
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Want to have a comfortable retirement? Here's how
Posted in Kiwisaver, Retirement, Savings on
Retirement - whether it's at 65, 67 or some other age entirely - probably seems a long way off. But if you can get on track now, your future self will thank you for it. Here's how to get sorted for retirement in five easy(ish) steps.
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Women fall further behind in retirement savings race
Posted in Kiwisaver, Retirement, Savings on
New Zealand's retirement savings gender gap just keeps getting bigger, new research shows. ANZ said, on current savings patterns, women were likely to retire with almost $80,000 less in their KiwiSaver accounts than men. General manager of wealth products and marketing Ana-Marie Lockyer said it was disappointing to see women falling further behind in their retirement savings. She said the average balances of women members of ANZ's KiwiSaver scheme, the largest in the country, were 19 per cent lower than men's. Women had an average $13,333 compared to $16,527 for men. A year ago, women were only 15 per cent behind.
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Fee debate welcomed
Posted in Kiwisaver on
The Commission for Financial Capability has welcomed fresh debate on the touchy subject of KiwiSaver fees after a new report suggested there was an "unhealthy focus" on fees - rather than the overall outcome delivered by various schemes. The Australian-based SuperRatings research house says that substantial improvements have been made over the past year in terms of member engagement and servicing, but chief executive Adam Gee says that "the race to the bottom on fees remains particularly concerning."
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Perils of the passive strategy
Posted in Kiwisaver, Savings on
There has been a huge amount of media commentary on the relative merits of active versus passive investing, particularly in relation to KiwiSaver funds. Most media commentators, including Weekend Herald columnist Mary Holm, argue that passive KiwiSaver funds are better because they are cheaper. Holm maintains that active funds underperform passive managers on an after-fee basis, mainly based on United States research, and she repeatedly encourages individuals to invest through passive funds rather than active funds. But this debate should also include an assessment of fund managers as financial intermediaries. The argument should not be about fees only.
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