Top Five Money Mistakes

Read More

Top Five Money Mistakes

 

There is nothing worse than carrying on through life and suddenly finding that for some years you have been making some basic mistakes in managing your money that have cost you thousands of dollars. Here are the top five mistakes to avoid:

  1. Spending everything you earn. Spending everything you earn now leaves you vulnerable to changes in your income and potentially unable to achieve significant and important goals. Saving doesn’t mean going without; it means being able to spend more, later!
  2. Not choosing the most appropriate KiwiSaver fund. The effects of compound returns can lead to massive differences in the final value of a fund at retirement, depending on which investment strategy is chosen. If retirement is a long way off, investing too conservatively may result in disappointing returns; if you are close to retirement, investing too aggressively may result in loss.
  3. Not insuring your most valuable asset. You insure your car, your house, your business, your life, but what about your most valuable asset – your future income? Most people earn between $1 million and $2 million during their lifetime. Insure yourself against the possible loss of those potential earnings.
  4. Not having a financial buffer. If you have no financial reserves, you may be forced to choose between borrowing money at a high rate of interest, selling assets at a discount for a quick sale, or taking a big drop in your standard of living in response to a sudden change in your circumstances or unexpected expenses.
  5. Mixing business finances with personal finances. Business income tends to fluctuate and raiding your business bank accounts for personal spending may leave your business short of funds later. Maintain a constant regular payment to yourself from your business so you can plan both your personal and business finances.

Related Articles

Economy
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.