Is there any point having KiwiSaver for my kids?
Is there any point in starting a KiwiSaver account for your chidren if you're not putting any money into it?
This is an interesting question. One of my children has a KiwiSaver account, because when he was born he qualified for the $1000 kickstart payment.
But the next year the Government scrapped this, so I didn’t bother to sign my daughter up.
Both KiwiSaver accounts have basically been untouched since. Instead of saving there at the moment, they have Sharesies and bank accounts, because I figure it gives us more freedom in what we spend the money on.
(Though it does take some firm explanation that we cannot use it to buy Fortnite skins or a go-kart.)
But once they start working, I’ll encourage them to get going in KiwiSaver, even if they are too young at that point to qualify for government or employer contributions. These become available once you reach 18.
The habit of saving a bit of your pay each month is a good one to get into early.
Once you get used to earning a certain amount, it’s much harder to then decide to sacrifice a portion of it.
That’s just my thinking, though – there are reasons parents might want to use KiwiSaver for their kids.
It locks money away specifically for a first-home withdrawal or retirement, so if that’s what you’re sure they should be saving for, it’s a way to make that happen. You can give the details to other family members who might want to contribute, too.
But I’d suggest if you’re really not going to put any money into it, it’s probably not worth it.
Some providers offer lower fees for kids – Pie Funds charges no fees for people who are under 13 and Simplicity does not charge admin fees – but in most other cases you will still pay an annual fee even if the account balance is very low.
You may be better off to consider other ways to get childrens saving for now. (I know having a few shares in Roblox is something that has helped explain basic principles of investing to my kids.)
Is there anything to watch out for if I’m thinking about a reverse mortgage?
As with most financial decisions – lots!
Reverse mortgages are becoming more popular with people who have significant equity in their houses but not a lot of income.
Generally, you borrow against the house and don’t make any repayments until it’s sold.
The interest rates are often higher than you’d pay on a standard mortgage, so the amount that you owe can add up quite quickly. Sometimes, you can choose to carve out a portion of your equity to protect.
It’s a good idea to get independent advice before you take out a loan like this, so that you can be confident that you understand all the implications.
Is changing jobs every few years the best way to get a pay rise?
I’ve often heard this advice, so I checked it out with Trade Me Jobs sales director
Matt Tolich. He said the average salary hit a record high at the end of 2023 so if you have not had a pay rise lately, it could be time to look elsewhere.
“Gone are the days where people stayed in the same job for years and years, it’s now more common to move jobs to gain new experience and opportunities.
Moving jobs can be a good way to get a salary bump – as employers are often more willing to negotiate when hiring than at the annual salary review process
“It’s a good idea to keep an eye on the job market to keep across what the market rate is for your role and industry, and if there’s similar roles that have a higher salary.
“Being across market rates and opportunities could help employees negotiate pay rises in their current role.
“If you’re not certain you want to switch jobs, you’re armed with the research to support a request for a pay rise.”
Tolich said salary was not the only thing to consider – you might also want to think about what health insurance, leave or other benefits you are being offered.
24. University is in a trough, for what it’s worth (5)
27. Little brother going up the mound (3)
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