kiwisaver, retirement, investment, advice

The Dangers of Following Generalised KiwiSaver Advice

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It’s so easy to jump on google and pick up a few bits of seemingly good advice on just about any topic of interest. This is perfect for figuring out the latest ‘fashion advice’ or learning ‘how to get more out of your workout’ but does it apply to KiwiSaver advice?

Whether it be from your neighbour over the fence or from a source on the internet, generalised advice is so readily available and easy to find due to its “one size fits all” nature. The author doesn't dive into personal details and unique situations as they are trying to attract as many people to  their content as possible. Regardless of their relevant qualification or perceived level of education on the topic, they may still make multiple assumptions to target the bulk or average pile of their audience. This is fine upon taking advice for very generalised subjects such as ‘the best ways to reduce water around the house’, where many people are in the same position trying to reach the same goal. But this certainly isn’t the case when it comes to your KiwiSaver investment.

The importance of personal KiwiSaver advice

No two individuals' KiwiSaver situations are the same. We all sit in unique positions based on a range of variables such as age, income, preference and personality (just to name a few). We additionally have our own, and often very divergent, goals. These key aspects act as inputs in determining KiwiSaver advice that is most suitable to each individual.

Here’s an example of a few differences to paint a picture.

John and Jane are both 57-year-old individuals wanting to prepare their finances for retirement. At a first glance one may think that being the same age, their retirement situation and goals may be very similar. A piece of generalised advice would be for the two of them to chuck any savings they have into moderate funds considering they both have 8 odd years until retirement. The provider of such advice has assumed John and Jane want to retire at 65, have the same tolerance for volatility,  and probably have a similar living style in mind for retirement. This is where personalised advice dives a little deeper… An advisor from National Capital established that John would like to retire at 68 and is very comfortable with some higher levels of change in the market if it means he might make a slightly higher return in his investment in the long run. He would like to sell his business at retirement and use that along with his KiwiSaver to fund his retirement and hobby of sailing (which sometimes results in a few extra boat repairs). All of these details help National capital to conclude that John should place his savings in a growth fund as it best suits his position and preferences.

Jane, on the other hand, wants to retire as soon as possible at 65. She would prefer to avoid any potential short-term loss in her KiwiSaver. When Jane resigns from her job she wants to stay in her small apartment and spend her days with her grandchildren and hiking in the beautiful forest, just a small walk from home. This in-depth information has helped lead National Capital to the advice that Jane would match up very well with a conservative fund. 

Regardless of their very different lifestyles, John and Jane are both able to reach their retirement goals.

This comparison is just an example of how minor differences can drastically change the advice required to make the right decision, and this is just two people! There are countless other combinations of ‘inputs’ from other people that can alter KiwiSaver advice further. Situational advice like this can’t be found in any book which is the major problem associated with generalised advice. Fortunately, if you are reading this article then you’re on the right path to avoid falling victim to the dangers touched on above.

Retirement too important a topic to get advice from a book or internet article

Your retirement (or first home purchase) is really important. The decisions you form regarding the matter could make or break whether you meet your goals or not. This is the focal reason as to why you shouldn’t be gathering pertinent information from a book or internet article. Having an experienced eye to look over your current situation, goals and potential options to reach those goals will be your best shot to reach and maybe even exceed your objective. When approaching the advice-giving process, National Capital uses a wealth of experience and knowledge to ask the right questions instead of making assumptions about your situation. This information is then used to tailor advice that will help you to achieve your specific goals.

How do I get my own tailored advice?

The last piece of the puzzle is simple. All you need to do to get your hands on the KiwiSaver advice created especially for you is to head over to National Capital and answer a few of the right questions in the ‘KiwiSaver HealthCheck’. Then one of our advisors can find the fund that’s going to help towards achieving your unique goals.

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Don't let someone make assumptions on your situation. Take a HealthCheck today to answer the "right" questions.

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