Top 10 NZ Super holdings listed; Minimum Credit payments crunched; Many clueless in KiwiSaver; Amanda's tax rage; Jean Luc Godard's Greek debt solution

Top 10 NZ Super holdings listed; Minimum Credit payments crunched; Many clueless in KiwiSaver; Amanda's tax rage; Jean Luc Godard's Greek debt solution

1) Savings and spending

I attended an interesting debate this week on whether New Zealand ought to introduce compulsory savings outside of the New Zealand Super, which is funded through taxes paid on income. (Watch the debate here).

It is a matter of debate itself whether the New Zealand Super will be sufficiently funded to support those in the workforce who will be retiring in 20 to 30 years time given the impending drain by Baby Boomers whose life expectancy continues to increase. 

I asked the folks who manage the NZ Super fund to address the question of the public pension scheme's long-term sustainability and was told it was a "policy issue" best directed at Finance Minister Bill English.

Instead, I was directed to their website, which is turns out is pretty interesting.

2) Credit and Debt

Drip-feeding debt is a bad idea, most of all credit card debt because it tends to have the highest interest rate. The trouble is banks and other lenders encourage it. How? By directing you to pay the minimum amount payable in order to maximise their profits. 

Here, interest.co.nz publisher David Chaston explains why minimum credit card repayment is so punishing.

However slowly, the tides are turning with respect to credit card disclosures, billing requirements and regulation. Several countries have introduced legislation requiring lenders to spell out how much consumers will cost themselves by going the minimum repayment route. Will New Zealand follow suit? Let's hope so. The first bank brave enough to make the change might just get my business.

3) KiwiSaver

Do you know what fund you're invested in? According to a survey released this week by the Institute of Financial Advisors, more than 25% KiwiSavers don't have a clue about what kind of fund they are in. A high proportion also don't know how much money they have in their fund. 

It's probably the same 25% that are invested in default funds, which are the most conservative of all funds on offer. That hasn't been a bad thing over the past few years because these uninformed investors were ironically spared some of the worst carnage that took place on sharemarkets during the global financial crisis.

Fund managers will tell you this is dumb luck and that these same investors are going to lose out over the long-term without more equities in their fund. Others, that is those with more bearish view of what's happening with the global economy suggest conservative funds, however low yielding, will be a safe haven.

Regardless of who you believe, it is important to know what fund you're in, what it is invested in and whose managing it. It's your retirement savings afterall. Check out our KiwiSaver section to find out more about your fund.

Also, to calculate what you could end up with at age 65, check out our retirement calculator here.

4) Death and Taxes

Tax rage. I'm feeling this in two countries. One lost my taxes for over a year, and now I have to pay interest for their error on top of mine for a late filing. Closer to home, my taxes also got waylaid for several months. Apparently got jumbled in with a number of other tax returns that had errors of some nature in them. Problem is solved now but for those hoping may be the tax fairy had turned red to black or made it all go away, better to pick up the phone and save yourself the added insult of even more interest owed for the time your IR3 spent in purgatory. Sigh.

5) Books and film

Franco Swiss filmmaker Jean Luc Godard in a recent interview suggested a quick way to help Greece get out of debt and prevent the Greeks from having to sell the Parthenon to the  Germans.

His proposal was this: that every European who uttered the word "therefore" pay 10 euros to dig the beleaguered nation out of debt. He reckoned it was the least eurozone could do for a country who gave the world 'logic.' Just imagine how much money the Greeks would make if the phrase 'going forward' was added to the list.

The New  Wave existential filmmaker may not find a big audience for the idea, nor for that matter his latest cinematic offering Film Socialisme, a story less string of evocative pictures.

In keeping with his Marxist leanings, Godard released the film for all to enjoy on You-Tube. The full length version appears to have been taken down but fragments of it are viewable in installments. Here's a taste of it. (Crack out the French-English dictionary). 

Alternatively, fans of Nouvelle Vague might enjoy the music video below it. Slightly less obscure.