Recent research shows that 1.5 million New Zealanders currently invest or plan to invest online. If this is you and you’re not sure where to start, or feel like you don’t know what you’re doing, relax. We’re here to make it simple.
You’re probably already investing
The good news is, if you have a KiwiSaver fund, you’re already investing! The money you contribute to your KiwiSaver fund is invested on your behalf by your selected provider. That’s one reason why it is critical to make sure you are in the right fund for you.
KiwiSaver funds vary in risk level. They are generally categorised as defensive, conservative, balanced, growth or aggressive. Which type of fund and which provider you choose determines where your money is invested. Finding the right fund for you depends on your goals, timeline, circumstances and values.
Once you’ve signed up and selected your fund, your contributions are automatically deducted from your wages and your provider invests your money in various assets. The only thing you have to do is make sure you’re in the right fund and make regular contributions.
Your KiwiSaver fund is accessible when you retire or buy your first home, so you might be thinking about getting involved with other investments to supplement your KiwiSaver or save for another purpose.
If you want to take investing a step further, there are plenty of digital platforms that make it easy to get started. But before you dive in, there’s something to be aware of.
Do you know what your investments are supporting?
Earlier this year, ANZ was called out for investing KiwiSaver funds in the Saudi military, thereby supporting the Yemen War. A Mindful Money analysis from September 2020 showed that $210 million of KiwiSaver funds were invested in weapons production. Other funds have been revealed to be invested in stuff like fossil fuels, animal testing, GMO’s and big tobacco.
A lot of Kiwis aren’t comfortable with this. For those who are conscious of their environmental impact and who strive to do good in their communities, it just doesn’t make sense to allow your money to support funds that contradict your values.
Ethics are personal. We don’t all share the same views, so what you are comfortable investing in might be unacceptable to the next person. There’s no strict right or wrong.
Take pharmaceutical companies, for instance. Some might be happy to be invested to support research that funds life-saving drugs. Others may feel that pharmaceutical companies charge too much for crucial drugs and don’t want to give them any more money.
What about adult entertainment, nuclear power or big banks? Corporations that are profitable yet treat their employees poorly? Companies that make ethical claims but fail to live up to them?
These are all areas where we have to make our own calls on what we are ok with. We have a choice in where we invest our money and what we choose to support.
The demand for transparency
Unfortunately many companies aren’t exactly forthcoming with their ethical practices, and some investment services don’t make it super clear where they are investing your money.
More and more consumers are conscious of their choices and the impact they make on the world. People have the right to know where their money is going. It can take time and effort to find the information but as more people demand transparency, businesses and investors will have to provide it in clear, concise language.
Before you choose which funds to invest in, have a look into what your money is supporting. A little research can help you choose funds that align with your values and ethics so you can be sure you are happy with what your dollars are doing.
BetterSaver matches KiwiSaver funds to your ethics
At BetterSaver, we are committed to helping Kiwis get their KiwiSaver fund sorted. One way we do this is by offering a Fund Finder quiz to help match you with a better KiwiSaver fund for you.
A key part of our quiz will ask you questions to identify where you stand on certain ethical issues. We have an ethical rating system for KiwiSaver funds by digging deep into the data to ensure we know where your invested money actually goes. This allows us to recommend a fund that not only matches your goals and timeline but aligns with your ethics as well.
We can save you time and effort while giving you peace of mind. Our expert research provides you with all the knowledge you need to make better choices when it comes to your KiwiSaver fund.
Take our Fund Finder quiz and make sure you’re happy with where your investment money is going.