Investment Webinar

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cord okay so it's going to record here so welcome everybody to our learn to invest
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webinar it's the one of five so this one is an introduction to investing
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so some of them have there's people still dialing in so feel free to interact with me via the chat
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box and we'll just get started at 10 o'clock
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uh sometimes you can use the raise your hand function as well but um just throughout and at the end of the session
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um there's always going to be times to ask me questions and i'm happy to answer
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anything as we go through so i might miss some questions as we're working our way through the webinar but i'll always
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come back to you happy to answer any questions you have especially with investing there's quite a lot to
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get through okay as always we're just going to start with our karakia
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so
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so welcome everybody to this morning session this is run by sorted you've probably
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all heard from sorted we are free independent and we offer impartial
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information about money matters anything from investments to debt you might have been on our website
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sorted.org dot nz i'm a contractor and i'm an investment advisor so i do investment advice in my
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real job and contract to sorted so hopefully i'm giving you some
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good investment information here so we don't give you specific advice um
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as part of sorted but we've got a lot of great resources for you so you can make
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your own informed decision so hopefully you've got some notes and you've got
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you're ready for today's session because i know you're going to find it quite useful
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okay so we're going to get straight into it and i'm going to do a little poll
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so interaction just um hang on a second i'm just going to
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relaunch my poll
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hopefully you've got a poll coming up on your screen
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just asking you which of the following assets have you invested in
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so the first one is cryptocurrency so this is a new digital online currency you probably heard about it
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highly unregulated and very prone to
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fraud shares are buying and selling shares on the share market
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or through a platform like shares ease or hatch or invest now
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managed fund a managed fund is where you go into a fund and they buy lots and
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lots of different shares and we're going to be talking about a managed fund in more detail today
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property you'll know what property is whether it's your own property or an investment property or commercial or industrial or
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infrastructure property bonds what we call fixed interest type investments not many people buy them
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directly now they it used to be really popular but you can buy that in a managed fund as well so um
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i will share the results so we can just in there
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there we go and of course kiwisaver so it's not surprising that kiwisaver and property
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are the most investing that this group has done which probably reflects the most of new
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zealand okay so quite high up there in shares and some cryptocurrency here
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uh and someone has bought and sold a few months so cool thank you so just get get your mind
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into the investment world and we'll be talking about these in a lot more detail i'm just gonna
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get rid of that poll and get back to me
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so we're going to talk about why we should invest and when we say invest we're talking the
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difference between saving and investing so saving might be in a bank account
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short term cash is um in cash we call saving and saving in cash in the
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bank is really good for your day-to-day needs and your transactional needs and
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investing is more long term so you need to think the difference between when you're saving and when you're
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investing putting something away for the longer term we're going to talk about the barriers to investing so what are the big things
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that people find difficult and six key rules to invest in just to give you some ideas about what to think
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about when you're investing yourself
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so why why do we invest i mean we've got our banks so we've got the money coming into our bank account and day-to-day
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transactions and then this whole other world of investing
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and we've touched a little bit crypto managed funds kiwisaver property shares
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bonds fixed interest there's a whole world out there of investing
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so why do we do that why not just keep all our money in the bank
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feel free to flick me a chat have a thunk so why are we here today why is the bank
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not just our go-to investment
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all right so someone's put the num money on the head so let's say you put had a six month term
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deposit so you went to the bank last year last december 2020 and you had some money you
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would have got 0.83 gross so not even 1 before tax
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and then does anyone know what the inflation rate over that time was so the costs of goods
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do you remember what inflation was so if you invested your money at 0.83
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and over that same time period yep someone said about six percent yeah it was 5.9 percent so you put the money in
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your bank the cost of goods 5.9 you're going backwards you're getting a negative return minus 5.1 return just
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from investing in the bank so we've got to think what's going to keep up with inflation
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what's going to make our money work and cash doesn't do that all the time sometimes it might be the other way
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around so we're going to talk about the different types of interest so yes so
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what we what we invest in we want to invest in lots of different things to make sure that our money is working hard
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and it's keeping up with inflation because the bank is just not doing it at the moment your money's going backwards
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but we have to do it carefully and we have to consider some things
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so why don't people invest do you think what are some of the barriers
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yeah lack of education or lack of money yep so you definitely have to have money to invest so this seminar is not about
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budgeting and saving this is about investing so yes you do have to have some disposable income to do that
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some people are risk averse so yeah so they don't want to take risks so a bank is seen
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as a low risk low return scenario and it is it is low
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risk low return but you've got to think your money in your bank is actually going backwards at
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the moment so let's consider some things as the other things we can invest in that's not taking too much risk that
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will make your money grow yeah access to investment so access at
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the moment is has never been better with really modern uh
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online platforms that people can invest in the next level is
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making sure they're not taking too much risk because there's not much advice around some of those platforms so
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hopefully this five series webinar will be able to equip you with some skills to
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to not take too much risk to take just enough and protect yourself as you go forward
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uh someone said yes risk can be scary if you don't understand it definitely which is why some people stick to the bank and
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other and others can lose money so there's definitely too risky and definitely too
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conservative and let's find somewhere in between that can get your money working harder
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trust investment companies well hopefully i'll be able to [Music] talk to you about when we say investment
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companies most of the time when we're investing the companies are the administrators and the underlying
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investments are so diversified you don't need to worry
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about a particular investment company if you're in a managed fund or a kiwisaver
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but if you have one investment with one company and buy one
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company then that is very risky and we'll talk about that as
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well uh don't miss anything anything else
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i've just got a comment here of sometimes you might need to lock your money away
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um these days a lot of investments you don't have to lock your money away so
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it's not it used to be in the past but there's lots of options available to
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you that you don't need to do that someone's also said you need to be an expert
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not really i'm going to show you some tools that you can find an investment that's good for you that's not too risky
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and that you can start investing from today if you want to
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let's move on to what we think are the six key rules to investing
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number one is your goal so keep in mind what you want to achieve now i know most
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people probably have kiwisaver
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and are just putting some money away but there's no goal attached to that so i want you to think about
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how much income do you want when you retire and this is going to go along
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with our kiwisaver so i want you to get thinking about that when you stop work
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how much money do you want do you want the same salary that you've got now are you happy to have a lesser salary just
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start thinking about your future what are your financial goals do you want to save for a house
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i don't know what everyone's goals are or ages you are or what stage in life
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you are everyone's going to have a different goal so just want you to start thinking about what you want to achieve
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especially over the next couple of days we're going to be um addressing your goals
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and just make sure it's realistic uh you know most people there's
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i get some people they're gonna win lotto it's not really going to happen
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most people you've got more of a chance of earning your own million dollars than earning
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millions in lotto so just be really realistic about your goals
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so rule number two is we're gonna have a look today at your risk profile
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so we're gonna manage your risk versus your return we've talked a little bit about cash is
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low risk low return and then there's going to be a sector up here it's going to be super high risk
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high return and there's going to be something in in the middle so we're going to try and get you to understand
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the difference between the low risk low return high
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risk high return and getting that right balance for you some people and everyone's going to be
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on the different um specter of that thing as we go through
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so once we've found out how much risk you want to take i'm just going to use this
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once we've found out how much risk you want to take and how much balance do you want sort of low risk do you want high
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risk then we're getting the asset mix right so what this means is that we are
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going to get you a good mix of investments so it might be a
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a bit of cash it might be a bit of bonds it might be some property it might be some shares
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so we work out and i'm going to show you the calculator on the sorted website
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where that is so you don't have to do this all yourself a lot of experts have done a workaround
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to help you figure out what the best is for you
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okay i'm just gonna move on to the next one and diversify so this is
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you not having to worry about one investment company if you're diversified
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you do not need to worry about that so when you hear about people losing all their money or
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with one company it's you know it does happen so we just
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i'm going to show you ways of putting your money where you're not with one company that company might be the
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administrator but underneath is um all of your assets like most you'll probably be in kiwisaver there'll be an
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administrator which i think with nzdf is mercer i remember
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i think um mark will be able to correct me on this so they are the administrator and then underlying that as all of your
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investments yes thank you immerse the administrator so you don't need to worry about mercer
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you pay the admin fee and then underneath is all of these investments if in the unlikely event something
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happened to mercer the nzdf would change the administrator and
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nothing would happen to your underlying assets so that's how kiwisaver works
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but the concept is just making sure you're diversified but if you're with kiwisaver and go into a managed fund you
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will be diversified and we'll talk about that a little bit more as well
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uh rule number five is some research so i'm going to show you a website and you can research uh you
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don't need to just go onto the web and do it all yourself sorted have come up with a really good
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way to show you all the funds available
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for you so it's a fantastic tool and hopefully you'll get a lot out of that one
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and just sit back and grow your funds so those are kind of the six rules and
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we'll be referring back to to these ones
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so first so the first setting is just have a think about your goals so we're not talking about
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maybe over the next year because if any of you've gone into the other new zealand defense force courses
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short-term goals we keep that in cash and bank so if you've got a
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goal that you want in one to two years then keep that with the cash flow and keep that in the bank
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but it's kind of the longer term goals that we're talking about so just take a moment to
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write down what you want to achieve in five years ten years or even longer
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so this person here got a house deposit in six years their goal is a hundred thousand
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and how they're going to do it they want to contribute 10 of their income so
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we're going to help you with your strategy as we go through so i don't expect you to come up with a strategy right now just have a think about that
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is there any questions so far while people are having to think about their goals
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okay let's move on
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okay this graph shows us starting to think about why we invest
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so remember we've got the bank so that's low risk and low return
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uh okay um [Music] yep mark's put on a comment here so he
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the the new zealand defense force have something called a flexi saver which is
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uh good for short term i think it's mainly cash based but we'll have a look at that at the end someone's asked how many
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goals should we aim for that's just completely up to you some people have one goal of trying to get
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into a house it's just really up to you williams asked about income insurance
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income you mean income protection insurance that is a
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big question so you've got to think i really recommend talking to your
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insurance broker about that so income protection is about protecting your income if you get sick so
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if you're reliant on your income to pay the bills then it may be a good option for you yes
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okay new zealand defense force provides you with some cover um on income protection insurance
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okay thank you great questions so looking at risk and return
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so what do we think is the lowest risk lowest return
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investment just talked about it what's the lowest
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return cash exactly yep this is cash in the bank
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so it might be a savings account it might be a term deposit remember my example of 0.83
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that was last over a year ago in december and inflation's 5.9 so it's low risk
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you're definitely going to get your money back but the risk with cash is that inflation's going to run and your
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money's going to be sitting in the bank and your cost of living is going up but usu usually cash is a really good
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low risk option and that's what we if you got something to spend in one or two years
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we save in our bank account so the longer stuff we need to start considering something else
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now bonds are what we call a fixed interest type investment so
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companies governments banks all issue bonds so let's say the asb or sorry
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a bank abc bank want to raise money for some business activity so they will come up with a
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bond they might say we'll pay you five percent for the next five years
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and you're thinking well i can get .83 in a term deposit
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or this fixed interest investment getting five percent for five years so it's kind of
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you you'll be giving your money to a particular company and they're going to use your money and they'll pay you back
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interest rates so another example might be
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an airline wants to raise money for their business activity so they might issue a bond get some money and say
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we'll pay you six percent for the next five years and and use that money and then they've got to part back at the end
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of five years so it's slightly riskier because usually your money is locked in
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for a longer term but you're getting rewarded for locking your money away
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but the clever thing is that you can invest in these investments but you you're not locked in if you go into a
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fund that buys and sells hundreds of these bonds so you can get access to these bonds without being locked in and
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as we go i'll explain a little bit more so just be aware so there's cash which is low risk low return
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bonds are there also classed as a low risk investment but you're getting a
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higher interest rate because you might be investing with a particular company and you might have um the bond might be
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longer term so it's classed as a little bit higher risk
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so the next one what do you think the next one might be so again we're moving up the risk return
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factor oh uh okay so a couple of questions here
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no compounding interest is a concept that is just means investing for the
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long term you get goal um interest upon interest so compounding interest is just a concept that the longer you invest the
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better off you'll be and there's going to be an example coming up later on
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uh right so someone's asked for the income insurance link yep we'll show you that at the end
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bonds are bonds secured investments some are some aren't
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so again in the bond sector you can get lower response to higher response
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depending on the company that's issuing the bonds
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uh okay so mark said that all details insurances are going to be put out in the force financial hub yes and
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everyone's guessed right the next one is
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property so when we're talking about investing in property we're not talking about your family home
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we're talking about an investment property or commercial property or industrial property so you can invest in
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or commit yeah did i say commercial all different sectors here so we when thinking about investing we don't
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usually think about your family home because everyone's got to have somewhere to live it's not we don't class as an investment so it's really going to be an
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investment property that you can sell at some stage and use the cash to to live on
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so yeah so property has extra risks of course it costs you a lot more to get into property and to get out of property
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uh usually like people to hold on to it for a long period of time because like at
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the moment if you bought a property five months ago and sold it now would you get
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a negative return you may because property values in auckland have gone down but of course if you hold on to it
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for five years it's a different story so short term there might be a few ups and downs but
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long term usually property goes up in value especially in new
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zealand at the moment but it is you need a lot of money to get into it
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but again i will show you that some of your kiwisaver funds probably have a bit of
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property in it and you can get into property through investing in a kiwi save or manage funds so you don't have
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to buy it your own in your own name you can it can be part of a fund
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so the next one of course we'll all guess is the higher risk higher return
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is shares so when we're talking about shares
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it's a whole big world out there and i think new zealand makes up
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0.1 of the world's share market so
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we when we're making a diversified portfolio we make sure we have new
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zealand shares australian shares worldwide shares
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and a sector that i don't know if you're aware of is an emerging market type
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shares so it might be specifically focused on india or brazil
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korea and someone's had a question of an etf fund
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yes there's an etf fund as a kind of fund that buys and shares lots buys and
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sells lots of different shares um so the wording i'm using managed fund
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but we can use the wording called an etf which buys shares so it's basically a big fund
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you're pooled with other people's money with lots of shares bought and sold
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lots of options available to you to get into the worldwide share market and they will
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buy and sell thousands of shares on your behalf we'll talk about that a bit later
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so the asset mix if we keep focusing on cash bonds property and shares and we're
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trying to get a really good mix of all of these different things
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how do we do that well first of all in our mind investment one we we kind of split it up into two
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sections cash and bonds is what we call income because they're usually giving you some
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kind of return on a quarterly basis or monthly basis um imagine your savings
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account you know you get an interest payment every month and your tax gets taken out of that every month so it's
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kind of that's the way it works but property and shares you don't probably get an interest payment
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um but it'll grow in value so if you're you
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know your property grows in value of capital growth same with shares just looking at uh going into ets is the
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shares yes not too sure william what do you what is ets
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turn to edius
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ah you're going into the emission trading scheme
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no i think that's completely separate
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don't no i haven't been asked that one i have to think about that to give me a few more details are you personally
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buying into it or um yeah i need a few more details for not
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answering that question so generally investments um
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follow what we call income versus growth
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and getting the right mix for you is what we focus on
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so everything about your kiwisaver do you know whether you are in say a
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conservative fund or a balanced fund or a growth fund or an aggressive fund
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so that would be really good for you to find out if you don't know some people do know some people
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don't so some people and conservative some people probably wouldn't have even um
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chosen their own fund and they might have been put into conservative as a default so great so there's some things
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coming through and people know so what this means usually the product provider
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the kiwisaver will call the fund what it's invested in
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so those are you in the conservative fund here
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you will probably have about 10 to 35 of your money
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in property and shares and the rest of it and kind of these lower risk ones
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for those in the growth fund most of your money sort of maybe 63 to
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90 of your kiwisaver will be in these assets
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um and a little bit here so usually most kiwisaver providers will call them similar names to these but
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what it means is is the mix of your income and your growth assets so have you noticed what's
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happened in the past month for all you growth investors
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have you been watching your kiwisaver because you've got a large exposure to
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the share market your kiwisaver will be going up and down which is a normal part of
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movement so we need you need to focus on is the share market going down
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you are paying in on a weekly basis or fortnightly based with your pay and you are getting shares
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at a bargain price so you just got to think we like volatility especially if you are buying
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in you're like great i'm buying into the share market i'm buying them to the share market especially when they're
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down and it started to bounce up a little bit we don't know how long putin's going to do his thing but we
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know that by the time you're 65 there'll be other shocks there'll be other coverts there'll be
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um flooding there'll be something else but the share market will go up and down especially if you're in a growth fund
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and you've just got to focus on buying in at these times because you're getting
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uh cheap shares basically on on sale and you'll start to notice as
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the markets recover look it might be volatile for the next six months we don't know but the important thing is to
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keep paying in especially if you uh you know with your uh retirement
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it might be decades away i don't know how old you are um
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but you've got a chance to grow your funds so it's important not to not to panic and definitely don't stop paying
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in and definitely don't switch so those in a more conservative portfolio so you you've still got a
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little bit of shares in your portfolio but it probably won't be bound down going down as much
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we'll be talking about this a little bit more over and over again just to make sure that you
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uh get it so i want you to we're going to be going into this
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calculator so if you can i'm not too sure of your computer set up can you go to
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this link here org sorted.org nz i'll click on it
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just give me a second and i'll bring it up on the screen
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ah i can't bring it up hang up
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just give me a second yeah this one here
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sorted.org.nz tools investor kickstarter i'm just
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going to show you i'm going to it's nine questions so it's what we call
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a risk profile questionnaire so you go through you answer some
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questions how long have you got to invest how prepared are you
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and what it does is it spits out a investor type so you will come out let's
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say i came out it's balanced and what it does is it tells you what
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mix you should be and the first thing you need to do is make sure your investor
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kickstarter your balanced investor profile matches your kiwisaver
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so if you can maybe after the seminar go and do this calculator and check where your
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kiwisaver is at so this tells you the mix of investments
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that we recommend so a balanced investor needs to be in cash bonds property and shares but you
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don't really need to remember these because as long as you're in a balanced fund
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as long as you're in a balanced fund the provider will do this for you and it tells you if you're in a balanced
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fund you should really be investing for six to eight years what you can expect in terms of returns
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and also you're gonna experience some ups and downs so this is really important
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especially we're going through volatility at the moment that you are going to be experiencing ups and downs
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in the market and then what can you expect you may in one year and every 5.4 experience a
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negative return so this is all part of you investing making the most of your money there's going to be some ups and
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downs there okay so that gives you some information about what you are and everyone's going to be
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different so a conservative person if you come out conservative
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look their expected return is lower their ups and downs are lower and they can expect a negative return
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one in seven years okay so a couple of questions here let's
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have a look uh do the income just do the income for yourself i think maybe everyone does
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their own risk profile um
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yep in the defense force same concept so as long as you do this risk profile
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your defense force will have choices of all these they will have whether you're conservative balanced or growth
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okay while you're playing around with that i'll just get back to the
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powerpoint slide just give me a minute
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okay so we're back now so screen's still good great
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so please do that investor kickstarter and check your kiwisaver check that it
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matches you don't want to be a growth investor and being in a conservative fund doesn't match you need
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to either push it up or um or if you're balanced and you're in conservative
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make sure your kiwisavers and and balanced and the defense force has all
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of these options for you and it's really important that that you're in the right fund because if
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you uh stay in a really conservative fund for 30 years you're gonna miss out on a
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lot of returns in the share market
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okay how are we going let's have a look so diversification so if you're in
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kiwisaver the provider is going to diversify for you it's very
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hard to diversify investing on your own so that's why we've got these kiwisavers
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and we're going to talk about managed funds as well so a kiwisaver has
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is going to do this diversification for you but it's got all of those lock-in criteria um till 65
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mainly you can get your money out of course and a managed fund will do exactly the
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same but you can get your money out there's no locked-in criteria so when we talk about a kiwisaver or a
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managed fund they're very similar just kiwi savers locked in and managed
36:41
fund is not so keep that in mind as we go forward
36:46
so how do we diversify or how does your kiwisaver provider diversify so what they do is they invest in new zealand
36:53
cash there's no foreign exchange issues our banks are safe and secure
36:59
so when they're investing your cash portion it's mainly in new zealand
37:05
when they look at investing your portion of bonds for you they will look in new
37:10
zealand and they will look as they will look at
37:18
good quality new zealand bonds corporate bonds government bonds
37:23
uh they will look overseas and they will do the research on whether there's a good quality bond overseas or
37:30
again corporate bonds government bonds so they're starting to diversify
37:35
overseas so as we move up the risk factor
37:42
okay oh sorry here's some examples of a new zealand corporate bond fischer and payton issue one fonterra my
37:50
issue one so and here we go in a new zealand government issues some bonds they might
37:56
issue a five-year bond or a ten-year bond so your kiwisaver provider will be buying and selling these on your behalf
38:03
all trying to get a better return than what you can get in the bank that's the whole idea that we do all this
38:09
and the government and corporates issue bonds to raise money for whatever they need
38:15
i'm just got a reminder here from mark that there is a financial advice service on the force financial hub
38:20
that we'll show you at the end of this so you can get some help there as well
38:26
so property so your kiwisaver provider is looking at new zealand properties and they're also
38:31
looking at overseas properties to buy and sell on your behalf
38:37
and shares here we look at new zealand let's say you might
38:42
and for an example banking by banking shares telecom shares
38:48
um it looks at the uk the us
38:54
and there's a there's a lot more here you can get that information from your kiwi saver provider at any time you can
39:01
get a list of exactly the companies that they invest in in new zealand all the kiwisaver and the
39:07
managed funds companies have to disclose exactly what they're investing in so you can get that information at any time
39:15
so this is what we mean about diversification so when you are in kiwisaver or you buy into a managed fund
39:21
it says stay balanced half of your money is going to be cash and bonds
39:27
of your money is going to be and about property or shares and it's in new zealand and overseas and your kiwisaver
39:34
or managed fund provider is doing all this for you so you don't have to worry
39:39
about that okay there's another slide about a
39:46
diversification
39:57
same thing he says my messages are taking me over just a second [Music]
40:03
let's just saying the
40:09
layers of diversification so in some of the uh communication you'll be getting from
40:15
your kiwisaver provider you might see some graphs and they're splitting into cash and bonds
40:21
um then as you get further down into the detail you can look at
40:26
where your money is invested in new zealand overseas then you can these are starting to be called sub
40:34
asset classes so you you can get into as much detail or as little detail as you
40:39
like in here has anyone got any questions about
40:46
diversifying like whether you've got a balanced fund
40:53
are you okay with do you understand that you've got um an administrator at the top and then you've
41:00
got all of these your assets underneath so all of your money is pulled together with other new zealanders
41:07
and these managers fund managers are buying and selling on your behalf and giving you a
41:13
really good diversification in your kiwisaver or your managed fund
41:24
how can we or has anyone done this how how did you do your research
41:33
you have you done any research for your investments
41:38
what i can say here is just make be very careful about uh
41:43
making sure you're in new zealand i had a client once that was researching super
41:50
superannuation and they were planning this superannuation on the
41:55
amount of money that was in australia they were on an australian
42:02
site and they were adamant they were getting money at um a certain age
42:08
and i just didn't think it was right and we actually had to have a look and see exactly what web page she was on and it
42:14
was yeah it scared me a bit that she was basing your decisions on uh something on overseas website so just
42:21
be really careful that you're in new zealand when you're researching this stuff
42:26
okay so mark williamson does his research every night for hours
42:32
some people are reading investment books yeah there's some really good books but of course we are going to show you
42:40
uh some research that sorted have done on your behalf is new
42:46
zealanders and it's called smart investor so i'm
42:51
just going to click on this and it did beep now it doesn't like it
42:57
so i'm just gonna have to exit out and i'm gonna show you
43:11
here we go so smart investor
43:17
dot sorted dot org dot nz this one really want you to
43:24
have a look at if you're thinking about investing so let's have a look at and
43:30
these are the two options remember there's managed funds and there's kiwisaver
43:36
so manage fund does exactly the same thing as kiwisaver but it just doesn't have the same benefits
43:44
but you're not locked in so let's say i've got a 10-year time frame and i want to save my
43:51
kids college so it's and i've come out as a balanced investor so what i want to do is i want
43:57
to have a look at my managed funds my balance managed funds
44:02
and it's going to come up again this assumes that you kind of know how much risk you want to take
44:11
okay yep and new zealand defence force have some as well so let's have a look so if
44:17
you're in booster booster has a moderate fund there's some growth assets there and
44:23
some income remember we've um talked about what growth was property and shares versus income cash and bonds
44:31
so boosters investment scheme the fees are 2.37 but the average
44:37
balanced funds are 1.53 so fees are quite high but what's their returns been like
44:44
these are five year returns 4.44 and the average is 5.3 so on the face of it this
44:50
booster one ah okay so
44:56
it does say i'm sharing
45:17
can you see me now can you see the smart investor share now
45:26
hmm you can see the powerpoint only
45:33
okay sorry about that okay so um let me
45:54
okay so back to this it didn't like the link okay so what i'm talking about here
46:01
if you can go to
46:08
smartinvestor.sorted.org i think that's the link
46:23
yeah just have a look at that that's what i'm talking about i'm sorry the technology didn't work on that
46:29
oh it's that right at the top of the page and you can compare
46:36
and just be aware of what's available to you in the new zealand investing world
46:50
okay the last bit of the slide is a little bit about compounding interest so
46:55
i know this is a really busy slide so let's focus on this a little bit so
47:00
uh this person here moana realized at 42 she needed to start investing for her retirement so she started investing 2
47:07
000 a year until she was 65 so that's 23 years so she decided to go for 5.5 and uh well
47:16
it's an aggressive fund and remember in the aggressive and growth it's aggressive as
47:22
quite a lot of growth assets like probably 90 plus 90 plus growth investments
47:29
so she's invested some money and he money earned over 23 years 52 000 so
47:35
she's got a total there of a hundred thousand so her money doubled which sounds quite good
47:41
but what we want to show you is if you start as early as possible
47:48
this one gigi and also invested for 23 years but she started at age 18.
47:55
in the same fund she invested the same amount of money and her money earned
48:01
314 thousand so her total was this so her money
48:07
doubled sevenfold but went up and up and up so someone asked a question about compounding
48:13
interest here's the two examples so the same fund
48:19
same amount of money but her money earned a lot more so she got
48:25
a lot more at the end how did it do that she has invested in a
48:30
longer period of time
48:37
starting at 18. but with kiwisaver new zealanders who start working quite young
48:43
do have uh access to all of that you know they can start saving and
48:49
they can have a lot of money at retirement if you just encourage your
48:55
whanau your your children to get in as early as possible it's really a good
49:01
idea just to to start and the sorted calculators can show you over time um what's going to happen to
49:08
your money you're changing funds as well okay don's shifting for people in early
49:15
60s that's a big question i suggest you get some financial advice you need to sit down with someone and figure out
49:22
what you need to do especially if you're closer to retirement
49:32
uh okay so uh have we got any questions
49:39
mark do you want to do your thing now yeah well thank you sarah thank you very
49:45
much for that just a number of points that people raised during the session which i just want to comment on a bit further
49:51
um so the first thing is the questions about the staff insurances and remember we actually have a comprehensive package
49:57
that's provided for all regular forced members and all civilians apart from casual civilians that's paid for and
50:04
provided for you by the chief defence force all the details are on the mibp
50:09
page of the force financial hub so you just go to the force financial hub go to the entity google force financial app
50:15
you go to the mi bp page and all the information is there similarly the information is there about
50:21
our savings scheme so remember we have the nzdf kiwisaver scheme we've got the
50:26
enzyme flexi saver scheme and we also have a grandparent scheme called the defence force superannuation scheme
50:33
as of last friday we've got about 10 600 members and around about 650 million dollars invested in our schemes they're
50:40
all managed funds the different rules apply they're reflecting that one is a kiwisaver
50:45
scheme so there's rules applying to that and then the rest are managed funds with a lot more particularly with the flexi
50:52
saver scheme a lot more flexibility around taking money out but again as with the schemes that sarah's been
50:57
talking about we actually have seven investment options so we've got cash conservative moderate balance growth
51:04
high growth and shares and you can make a decision about how you want to invest your money or we will make a decision on
51:10
your behalf and our default setting is the balance fund
51:16
second thing is just around resources and things there's a lot of information out there that is some of it's free some
51:22
of you have to pay for what we do is we actually put together a resources sheet that's updated on a monthly basis so
51:28
anyone who would like a copy of that please email me at benefits nzdf.mill.nz that's benefits at
51:37
nzdf.mall.nz it will be replied to within 24 hours and we can send you a copy of the resources sheet which gives a list of
51:44
the latest books and magazines podcasts webinars seminars etc etc that are available both
51:50
new zealand and australia on investments and things like that in particular and there's an awful lot of
51:55
material out there a lot of it's free i know we're all time poor and that's part of the issue so it's around just making
52:02
some time to actually read these things because there's some really critical information um there
52:08
sarah talked about retirement funding and retirement goals and i think this is covered off in some of the other
52:13
sessions further down the track what we do is we tap into the annual
52:18
massey university research that comes out each year that shows people how much they need to have in retirement and
52:26
you'll you may recall we run a campaign every may called how much do i need for my retirement we coincide that with the
52:33
release of the annual member statements for the ncdf kiwisaver scheme and you may recall there's actually a survey
52:39
that we ask people to participate in each year as well and the rationale for that is we're trying to plot whether
52:46
people are reporting a difference in their preparedness for for financial well-being and their preparedness for
52:51
retirement in particular um sarah also talked about share market
52:57
volatility and she's quite correct there's the one thing that's certain about life and investing and shares is
53:02
the share market volatility i've got a book here as part of my collection called a random walk down wall street
53:08
written by a chap called burton martial and what it does is it has a chart in
53:13
there that shows share market returns of the us back to 1864 1865 which was the
53:19
end of the us civil war and um what it shows is on average about every seven years there'll be a dip for
53:26
whether it's a twin towers a russian invasion of the ukraine or somewhere else there may be a crisis in the uh the
53:33
international economy about every seven years on average there'll be a difference of share market returns in
53:38
particular a lot more volatility but guess what invariably they bounce back
53:44
and they start going up and up and up again so as shira hot as sarah highlighted by far shares is the best long-term
53:51
investment but there's also the one with the greatest volatility as well and so that's where doing your research and
53:58
having a good look and reading and everything else is very important as well sarah also talked about the impact of
54:04
compounding interest and going back to that last chart which i think is a very powerful chart i've got a book here
54:09
called the path by uh peter malouk and tony robbins and on page 11 they actually have a
54:15
chart which shows again the compounding effect basically someone who starts saving at age 20
54:20
and puts in 60 a week will have a million dollars by the time they take
54:25
they turn 65 with with a compounding effect of the seven percent per year
54:31
by contrast if you start saving at around 50 you'd actually have to be putting in around about three and a half
54:37
thousand dollars a month to get to that same um to have that same effect so again what
54:44
it highlights is you start early at a young age even just a little amount each each pay and over a period of time the
54:51
snowballing effect takes care of itself and hey presto bit by bit you see your returns
54:57
increase um i think those are the key things just want to talk about but i'm happy to stay online with sarah afterwards to answer
55:03
questions that people may have so please um and sarah's brought up the force financial hub as well so you can
55:09
see what it looks like on the internet it is an internet google site so you have to go to the internet google force
55:15
financial help you bring it up the reason why we've made it internet based is so that you don't actually have to be in the office you don't have to have
55:21
access to texas to see all of us and just as importantly everything we make available is available for family
55:26
members partners as well and you don't need to have your your partner doesn't need to have you there to be
55:32
able to access these things either as long as they see the internet then they can access all this information as well
55:41
yes are you happy to yeah come on and please click on that survey link because we always need to know
55:47
with the information's relevant and how we did the webinar um please do the survey link as well but yeah mark and i
55:53
will be here answering any questions someone's already asked about financial advice yeah
55:59
but yeah so first financial hub is your first go to so don our financial advice service is
56:05
an organization called milestone direct limited it's headed up by an ex-army major by the name of joseph darby so
56:11
joseph and his team got an idea of how defense operates they are a new zealand-based company
56:18
but what they do is they'll give you advice that relates to both domestic investments and international
56:24
investments the benefits of address is benefits at nzdf.mil
56:30
actually if you have a look at the force financial hub screen you'll see it's just highlighted midway down the screen
56:35
there so it's benefits at nzdf.mill.nz
56:40
any email sent to there will be replied to within 24 hours
56:49
other questions
57:10
oops will be so hopefully we'll see everyone this afternoon at two o'clock
57:19
and remind others that we're still happy to take registrations i think we had about 50 registered for this morning
57:25
we've got plenty of spaces so anyone who's interested in attending and that includes partners they're most welcome to
57:30
attend as well
57:36
great
57:46
okay that looks like it's there yeah okay so how many people did we have in the
57:51
end how many do we have a team sarah oh i think there was
57:57
about 45 okay that's good what tends to happen is we get we end up with a lot more registrations that people attend
58:03
people get diverted something happens or something and then they have to run off so a bit of a putty but
58:09
hopefully we'll get more this afternoon can we see