"I wish I'd realised sooner that 'day trading' or share trading, very rarely results in profit.
"I believe people are better off investing in shares and holding them. It's way less stressful - and far more likely to be profitable over the long-term."
Joe Taylor, founder and CEO, BetterSaver
Money. It's the driving factor behind many life choices, but is it the be-all and end-all?
'Me and My Money' is a regular feature that investigates Kiwi attitudes towards money and what drives the choices they make.
Joe Taylor, founder and CEO of BetterSaver, a KiwiSaver advice provider, says it's important that KiwiSaver members are in the right fund for their situation.
Many people think KiwiSaver is a 'set and forget' exercise, he says. But it's important that people review their KiwiSaver from time-to-time, to make sure it supports their goals.
Rather than making daily trades in the hope of a quick buck, Taylor advocates buying shares and holding onto them.
His biggest tip for young savers is to budget. As it is a guideline for spending and saving, a budget helps people to achieve their goals, he says.
1. Are you a saver or a spender?
I'd say I'm a mix of both: sometimes it’s good to save and sometimes it's good to spend.
2. What's been your biggest financial lesson, success or failure?
I attribute my biggest financial learnings to my Dad.
He taught me about the power of compounding interest when I was young - he really wouldn't stop going on about it.
I believe it laid the foundations for my fascination with investing.
3. What do you know about money now that you wish you'd known sooner?
Those who are interested in money and stocks will have seen people who have made their millions from investing.
I wish I'd realised sooner that 'day trading' or share trading, very rarely results in profit.
I believe people are better off investing in shares and holding them. It's way less stressful - and far more likely to be profitable over the long-term.
4. A recent purchase you consider was value for money?
My coffee machine is worth its weight in gold (it's had a work out over lockdowns and working from home).
It's feeding my coffee habit - and reducing the cost to service my habit.
5. What do KiwiSaver investors need to remember during the current period of share market volatility?
That KiwiSaver is a long-term investment strategy - not a 'get rich quick' scheme.
While there's a lot of chatter around current market volatility, it's important not to panic.
For KiwiSaver members who are in the right fund for their risk tolerance and goals, share market drops shouldn't be much of a concern.
Those who aren't planning to withdraw money in the next couple of years to buy a first home or fund your retirement, can rest easy.
For people who do need to withdraw money in the short to mid-term, we still don't advocate making knee-jerk decisions. In this case, we recommend chatting to a financial adviser and setting out a plan for a more financially secure future.
6. What's your preferred form of investment and why?
I can't say I have one preferred method of investment.
Though I have to say that I hate the fact that Kiwis look at property as their key investment, and how so much of the financial fabric of Aotearoa is stitched into owning property.
But given how the property market has gone, I don't blame people!
I believe in having a well-diversified portfolio across a range of investments.
Each person's situation is unique. That's why financial advice can be super-helpful and something I highly recommend getting.
7. What’s your best saving tip?
To have a budget and use it.
A budget sets parameters around spending and provides a picture of how much money is spent, and where.
It increases the likelihood that goals will be achieved, so people can live the lifestyle they want.
8. What’s the best money advice someone’s ever given you?
I like this quote from Warren Buffet:
"Someone’s sitting in the shade today because someone planted a tree a long time ago."
To me, it shows how important it is for people to plan for their financial future.
The sooner they get started, the sooner their goal can be achieved.
The views expressed in this article are personal and are not professional financial advice.
