Five Common Investment Myths

Read More

FivepenceFive Common Investment Myths

Not knowing how to go about it is one of the main reasons why people don’t invest, along with a number of misconceptions about investing. Here are the most common myths and why you shouldn’t believe them:

Investing is only for people with a lot of money

Diversified managed funds make investing easy for smaller amounts. Most funds will accept a low initial deposit (around $1,000), which can be added to by a regular monthly contributions. Even small regular amounts can grow to a significant sum over a few years.

Investing in shares is risky

Providing you have a well diversified portfolio, the key risk you face with shares is the risk of how long you need to remain invested in order to generate a good return. The share market moves in cycles with an upward trend over the long term. A well diversified portfolio held for the long term is unlikely to result in loss of capital.

Investing in bank deposits is safe

All investments carry some aspect of risk, and with bank deposits the biggest risk is that of loss of purchasing power of your money through inflation. If you invest $10,000 on term deposit today for five years, the $10,000 you receive in five years time will not buy the same amount of goods and services that it can buy today.

You should pay off your mortgage before you start investing

Getting rid of your mortgage as quickly as possible is a good idea, but so is getting into the habit of investing through regular contributions to an investment fund. KiwiSaver should be the starting point.

You need to be an expert to be an investor

There are many investment products available that make investing easy. A good financial adviser can recommend something appropriate for you.


Related Articles

Liz Koh

Budget Winners and Losers

The latest Government budget had something for everyone but while most households will be a few dollars a week better off, there are some clear winners and losers. In the winners’ corner are businesses, those on high incomes, and savers. The biggest losers are property investors who have built large portfolios financed partly by tax rebates.

Read More »

Top Up or Miss Out

The end of June is an important date for KiwiSaver members. The financial year for KiwiSaver runs from 1 July 2009 to 30 June 2010 and if you have contributed at least $1,040 to KiwiSaver during that time, you will be eligible for the full amount of Government tax credit to be paid into your KiwiSaver account in July.

Read More »

Responsible Investing

There is a worldwide trend for investors to want to make a positive contribution to the world by investing in companies that are socially and environmentally responsible. If you are passionate about the effects of climate change, the scarcity of food and water, and social or environmental policies in general, then you will no doubt wish to ensure that the companies in which you invest are going about their business in a manner that is consistent with your views.

Read More »

Helping You Live your retirement To the Max

Keep in touch

Fill in your details and we’ll get back to you in no time.