NZ Everyday Investor

03/03/2025

More people are hitting 65 unable to retire - it's an upward trend.

Live well, fall in love, travel the world and pop out some kids...just don't forget the strategy for when you stop working.

Start by avoiding these classics:

Pay off the mortgage and rely on government super.

Start investing right before you retire.

Accept too much volatility for your timeframe.

And everyone's favorite (if they have wealthy parents) wait for an inheritance...

I spoke with Ben Brinkerhoff last week on the Everyday Investor.

If it's an early retirement you're after, or just a really awesome one, answer these 7 questions.

Check it out!

https://bit.ly/43ldSfM

28/02/2025

"..it may not be clear what is needed for a person to qualify as an eligible investor"

Margot Gatland, Head of Enforcement for the FMA.

Some investors are genuinely protected by the wholesale investor rules. Other investors are protected only from stronger returns.

The challenge: How does a regulator protect AND permit, at the same time? It's a tough job - maybe why they need help from the court?

The backstory: The Financial Markets Authority (FMA) of New Zealand is trying to address systemic concerns about the misuse of eligible investor certificates in 'wholesale' financial markets. This follows years of regulatory scrutiny, enforcement actions, and growing evidence that 'retail', everyday investors, are being improperly classified as wholesale participants (wholesale investors don't have to be provided the same levels of disclosure as retail investors do).

The pursuit of higher returns will pick up pace again as interest rates drop, so this needs to be sorted out.

The Libertarian in me says: Let fools be separated from their money - eventually they'll learn and if they don't, it's not for the state to worry about. The 'balanced' perspective: We need to provide a level of protection to ensure vulnerable investors don't lose money, while also providing an 'express lane' for those that know what they're doing.

Regardless, the current rules, especially if ambiguous, should be deleted and replaced with something brand new, ideally in partnership with industry-participants.

https://bit.ly/4bfmC97

The court is being asked to clarify the issuing and use of certificates for knowledgeable investors needing less protection from finance sector laws.

26/02/2025

The NZ economy is recovering.

How can I be so confident? I used to get inbound sales call once a week - I now AVERAGE two per day.

Sales people are out there hustling, trying to get things moving.

- SEO for website optimization
- Financial compliance services
- Home maintenance services
- Video editing services
- AML/CFT programs
- Social media strategies
- PR firms pitching guests for the Everyday Investor podcast

When times get tough, we can see two groups of people in action, one after another: Those who 'check out', and [later] those who 'step up'.

100% respect to all those out there selling right now - I genuinely believe you're at the forefront of an economic recovery. I try and be friendly during these calls, but can I ask a couple favors?

Research me BEFORE the call, add value BEFORE the ask, and know when to back off.

26/02/2025

'...enjoyed it far more than we expected...'

Honestly, that's high praise.

Good advice isn't always nice, and it's often not technically 'correct' either.

Having trouble moving forward on some key decision? Reach out and let's see if we can move the needle!

https://bit.ly/49lc5Yu

24/02/2025

"I barely make enough to survive day to day. I doubt I'll ever be able to retire"

50% of 45-64 year people have a 'retirement plan'. A recent InvestNow report finds that only HALF of these people think it'll work, though.

Those who have more, take the job of investing more seriously (no surprises there), and those without [understandably], feel a bit cynical.

Here's 3 things we can/should all do, if we can:

1 - Get a strategy. Ideally one that doesn't revolve around the investments themselves, but what you're trying to achieve)

2 - Actually invest. Don't get stuck in 'research' or infotainment, rather, put into practice what you learn / put some money where your attention is (assuming you're interested in investing!)

3 - Behave like a professional. Practice self-awareness, macro-awareness, and find a 'happy place' between a shot-gun approach (diversification) and convicted concentration.

Want more, check out InvestNow's 10 principles: https://bit.ly/4hQagXv

24/02/2025

I'm guilty of perpetuating a word crime.

Several times a day, in the context of money, I talk with people about 'risk'.

For most people, the word 'risk', implies 'probability of loss'.

Often, though, I'm talking about VOLATILITY (how quickly and dramatically prices can change).

It's in product disclosure statements too.

In the spirit of simplifying complex topics like 'Volatility', the word 'Risk' is often used instead.

What's the big deal?

It’s a matter of semantics, but when we (advisers, regulators, fund managers etc) try to keep investors “safe” by using the word 'risk', we might inadvertently shield them from “returns”, too.

Some of the best investments come with high volatility, while some of the least volatile options can be the riskiest. Go figure!

https://bit.ly/4ids52e

21/02/2025

Is THIS why NZ banks are so profitable?

They need to support their failing parents?

How on earth are they going to make it when digital disruption begins in earnest?

A $26 billion rout in Australia bank stocks this week after two of the biggest lenders reported increasing margin pressure is fueling concern about the sector’s profitability.

19/02/2025

Turning tornado's into timelines since ages ago 👊

Most people I work with are smart enough to work out what their options are.

To get wealthy or plan an amazing retirement, you need more than smarts, though - you need someone EXTERNAL, to show you what you can't see.

If you're too close to the problems, you may be too close to the solutions, too - want to chat?

Book a call here: https://bit.ly/49lc5Yu

19/02/2025

0.50% slashed off the official cash rate (OCR) here in New Zealand.

0.75-1.0% would have been better (and a 'sorry' for their part in causing the problem to begin with).

A 0.5% drop works out at around $100 per week interest savings on a $1m mortgage (assuming the banks pass it on).

That's more money able to move through the economy, and it's a reason to hang on, knowing things are going to get better.

P.S. - give the banks a couple weeks to adjust.

16/02/2025

So many things about investing in start-ups I had to unlearn in this conversation.

#1 Diversification may NOT be the answer if you want to get rich.

#2 We don't have a shortage money to invest in this space - we have a shortage of GOOD VENTURES.

#3 The government should not in fact, throw more money at tech start-ups.

Rowan Simpson: https://bit.ly/4gGO2Wn

15/02/2025

Get rich, by being wrong?

Rowan Simpson (aka The 'quiet one') got in early with Trade Me, Xero, Vend, and Timely.

He used the power of being wrong, to get rich.

Failing fast is the strategy of quickly prototyping, testing, and iterating to learn from failures early in the development process.

Out tomorrow night on YouTube

12/02/2025

Will Gen-X ever be able to retire?

If you're younger than 60, new research warns against relying on outdated retirement perspectives from boomers.

The latest Retirement Expenditure Guidelines estimate households will need up to $500,000 to fund retirement BEYOND NZ SUPER.

Homeownership rates are expected to drop from 60% today to 48% in 20 years.
Rent, insurance, healthcare, property taxes, and energy - all if it will likely grow at a rate higher than what's being measured in CPI.

Solutions?

Keep KiwiSaver in Growth Funds Longer:
Pre-retirees may consider maintaining their KiwiSaver in growth-oriented funds even into retirement. While this involves a higher degree of uncertainty, it allows for the possibility of stronger returns over time. This strategy requires careful monitoring and a strong risk tolerance - not ideal.

Increase Contributions and Plan for Inflation:
Boosting contributions to KiwiSaver or other investments can help build a bigger pot. I'd also model a higher rate of inflation. Do we REALLY believe costs such as healthcare, rent, and rates and energy increase by CPI?

Tap Home Equity Strategically:
For homeowners, reverse mortgages or home equity release schemes can provide supplemental income in retirement. There's no prizes dying rich, so if you have equity locked into a property, maybe set it free? Borrow gradually while still retaining ownership, or consider the newer "debt-free" equity release options now available (e.g., selling a percentage of home equity).

Keen to get a plan sorted in this space, reach out!

https://bit.ly/4jNBtLJ

10/02/2025

At almost 4% inflation, money loses half its value in about 18 years.

'For the wealthiest household group, inflation was 2.7% and for the poorest it was 3.9%.'

Can government fix this?

Can central banks save us?

Not when the money's being interfered with. The only thing guaranteed is inequality becomes worse.

The solution won't trickle down, nor come from taxing the rich. The solution's never found in 'left' or 'right' politics.

Some try to out-earn it or chase high returns to shield themselves from inflation.

I think if you can, you should learn about saving a portion of your wealth in alternative forms of money like gold, silver, and Bitcoin. It's not about 'number go up'- it's about taking wealth out of one system, and placing it another.

If you exchange currency for money that's worked in the past, or could work in the future, you're vote just became more powerful.

"The secret of change is to focus all of your energy not on fighting the old, but on building the new." Socrates.

Inflation slowed down but some groups shouldered more of the burden.

10/02/2025

Bitcoin has already won as a store of value.

When we start USING it, it wins as a medium of exchange.

"Innovators and creative thinkers are often derided by their contemporaries, but it is their ideas that ultimately shape progress." Ludwig von Mises

Great chat with the guys behind Lightning Pay NZ!

https://bit.ly/40UM7rt

04/02/2025

Trump: Always the favorite bogeyman in NZ.

Is it reasonable to blame him for higher mortgage rates, should they eventuate?

Tariffs = inflation. Sure, I understand, but isn't there more to the story?

Like the fact longer term yields were rising well before he was elected?

Who knows, perhaps it was 'higher for longer' all along.

Punchline: Because the world's more nuanced than we'd like to admit, speculating that rates are going to fall further from here could be a scary strategy

Trade tariffs on Mexico, Canada and China could mean interest rates stay higher here.

04/02/2025

Looks like the Trump-Tariffs were a legit threat after all?

Some say it'll make American great again, others say it's a guarantee for further inflation.

Fascinating to see the difference in media reporting and economic commentary coming out of NZ vs the rest of the world.

I think we need to get over the personality in charge, and start studying the effects of these decisions on our own economy.

I find it challenging to understand how any form of taxation in the US contributes to long-term economic growth. Similarly, if New Zealand is moving towards a mercantilist system, I struggle to envision a smooth transition. Am I overlooking something?

03/02/2025

'You don't meet too many wealthy pessimists'

Too true - For years, people have been calling for a crash, or a crisis of some kind. In reality, and in most markets (apart from NZ property!), the graph is relentlessly tracking upwards and to the right.

Shall we all ignore the 'doomers', then?

If you're just starting out and building up, perhaps...

Personally, while I'm not sure a credit crisis is imminent, I'm going to pay attention to those with little to lose by being honest.

It often pays to consider BOTH sides of the coin, if you want to KEEP your coin.

What's the difference between money and credit?

Will a trade war help, or hinder my portfolio?

Where should we park our wealth should the 'system' fail?

Check out the latest Everyday Investor Pod with Alasdair Macleod for all the answers - out NOW: https://bit.ly/3PYuIsT

02/02/2025

' is money. Everything else is credit' J.P. Morgan

What holds value in times of REAL economic uncertainty?

If we're long overdue some sort of financial 'event', then 'high-risk' investments are typically what you avoid. This is a criticism of Bitcoin. Some prefer Gold for this reason.

My view, it all depends on what kind of future we get, so I use both as a type of savings account, that exists outside of the system at risk.

In the context of a crisis, some speak gold, some speak Bitcoin, and 'others', speak a bit of both.

Enjoy my latest chat with Alasdair Macleod

https://bit.ly/40SuSYY