By Amanda Morrall
1) KiwiSaver user's guide
Regulars to our site will know by now the ins and outs of KiwiSaver. For the benefit of those still trying to come to term with the basics, Morningstar NZ's Chris Douglas and myself helped to produce this segment for Radio NZ's This Way up programme. We'll have a second instalment in a few weeks time so stay tuned.
2) Psychological tips for investing
The more things change, the more they stay the same? Personal finance blogger prairieecothrifter.com decided to put that piece of wisdom to a test looking at whether investment writer David L. Markstein's psychological tips from his 1960s' "Build a Fortune in the Stock Market" were still relevant today. Mostly.
3) Confessions of an account junkie
The advent of internet and mobile banking has made keeping tabs on bank balances easy. I expect, the process and habit will continue to improve as revolutionary new apps and systems for personal banking come on stream. Keeping track of your financial condition will undoubtedly lead to better long-term outcomes if it remains front of mind. Here's a confession from a self-professed account junkie from deliverawaydebt.com
4) Missing out?
Have small time investors been priced out of the financial advisory market by the new regulation? In her latest blog, Wellington's Liz Koh of MoneyMax. explains how regulation has ironically damaged the relationship.
One of the unfortunate consequences of increased regulation of financial advisers is that some smaller investors now find themselves squeezed out of the market for personalized investment advice. There are two types of investment advisers who are able to give advice to the public: Authorised Financial Advisers (AFAs) and Qualifying Entity Advisers (QFE advisers). Whereas AFA’s can give investment advice on a wide range of investment products, QFE advisers can give investment advice only on products offered by the company they work for. QFE’s are generally large companies such as banks and insurance companies. There are less than 2000 AFA’s in New Zealand, and many who hold the designation do not give advice to the general public. Just to make it even more confusing, some of the AFA’s work for QFE’s such as banks. An AFA working for a QFE can give advice on a wide range of investment products from different providers.
With the limited number of AFA’s available, many advisers and QFE’s are now setting minimum limits on the size of investment portfolio they will advise on and manage. These limits can be anywhere from $100,000 to $1million or more. At the other end of the spectrum, QFE’s such as banks are using the large number of QFE advisers in their branches to sell KiwiSaver and savings and investment funds for small lump sums or regular contributions. It is increasingly difficult for investors with small to average portfolios to find advisers who can advise them on a wide range of investment products from different providers. Getting advice on whether to purchase shares in the proposed Government asset sell-down is a prime example of this, as advice will need to be obtained from an AFA, not a QFE adviser, many of whom will not be interested in smaller investors.
5) Reality Bites
On Friday, interest.co.nz contributor Terry Baucher hypothesised about the negative tax implications for The Block TV show's winners. Assuming they do have to pay tax on their winnings, the effort expended takes on a different light. Greg Ninness takes a similarly sobering view in this article published on stuff.co.nz by taking into account the real risks and more probable outcomes faced by the average do-it-yourselfer looking to make money in the residential property market.
To read other Take Fives by Amanda Morrall click here. You can also follow Amanda on Twitter @amandamorrall