Do New Zealanders know how to invest?

It's Money Week this week for New Zealand, and the Financial Markets Authority (FMA) commissioned Colmar Brunton research to see how clued up Kiwis are about financial investment. 

The survey asked many New Zealanders to state what risk level they associated with a number of investments, from residential property to Kiwisaver funds, and also to determine the returns people would see on these investments. 

Head of Primary Markets and Resources for the FMA Simone Robbers noted that "people seem to understand that term deposits and fixed interest investments are lower risk investments but there was confusion around the levels of risk of growth focused investments."

"It's important to understand what level of risk is most suitable for you and the mix of investments that will help you reach your financial goals."

Those surveyed also expressed confusion about which investments come with guarantees, and Ms Robbers noted that products should state if they carry a guarantee as many do not. She added that every investment comes with at least some level of risk. 

When it comes to residential investment property, 43 per cent of respondents deemed it low risk, while 48 per cent thought it was medium risk. Younger people are more likely to view property as risky, with 13 per cent of 18-24 year olds thinking it is a high risk venture, compared to only 3 per cent of those between 50 and 64. 

How do you get clued up on investment?

With this evident confusion about investment, especially in property, it is clear that more New Zealanders need to get suitable advice to attain financial independence. 

By working with an Authorised Financial Adviser, people can work out great ways to make investments in property – which, it must always be remembered, is a long term investment. The earlier you get into it, the better returns you'll see down the line. 

Here's to your financial independence!

Daniel Carney
Authorised Financial Adviser / Investment Property Expert