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How A $10 Or $20 Weekly KiwiSaver Plan Grows For Your Child · That Home Loan Hub

• 0:10
  SPEAKER_00: We talked about Kiwi Savers for children quite some time ago.
• 0:14
  SPEAKER_00: If you haven't listened to those, scroll back and have a listen.
• 0:17
  SPEAKER_00: But I've got Dave Cobson back from Booster and we're gonna talk a little bit more about kits, Kiwi Savers, and anything else that's related.
• 0:26
  SPEAKER_01: Good morning.
• 0:27
  SPEAKER_01: Good morning, Dave.
• 0:28
  SPEAKER_01: How are you?
• 0:28
  SPEAKER_01: I'm good, good, thank you.
• 0:30
  SPEAKER_00: Awesome.
• 0:30
  SPEAKER_00: So you're back.
• 0:31
  SPEAKER_01: Yeah, back again.
• 0:32
  SPEAKER_00: Lovely to have you.
• 0:34
  SPEAKER_00: Children.
• 0:35
  SPEAKER_01: Yeah, it's um something that's cropped up in the press recently is that obviously the government looking at making a few changes to KiwiSaber, try and improve it.
• 0:44
  SPEAKER_01: And one of the things they're looking at is having a thousand dollar kickstart for newborns.
• 0:48
  SPEAKER_00: This is if the new well existing government gets in.
• 0:52
  SPEAKER_01: Correct.
• 0:52
  SPEAKER_01: Yes, correct.
• 0:53
  SPEAKER_01: So but it it might be something that the other government look at as well because it is something to try and get people started and educated and helping themselves out.
• 1:00
  SPEAKER_00: Because it did have that back at the back in the day when I had my firstborn.
• 1:04
  SPEAKER_00: He was lucky enough to have that thousand dollar kickstart contribution.
• 1:07
  SPEAKER_01: Yep, there was a thousand dollar kickstart for everyone at that point.
• 1:10
  SPEAKER_01: So yeah, it was a nice it was a nice way to start thinking about it and starting to understand what it means as you get a bit older.
• 1:17
  SPEAKER_00: Mm-hmm.
• 1:18
  SPEAKER_00: And now?
• 1:19
  SPEAKER_01: Yeah, now I well, even without the$1,000 Kickstart, I've always been a big fan of telling parents to make sure they sign their kids up to Kiwi Saber and start putting some money in for them over a period of time because it will help them get into a first home for starters.
• 1:33
  SPEAKER_01: And if they don't use it for that, it gives them a really nice start in life.
• 1:37
  SPEAKER_00: Yeah.
• 1:37
  SPEAKER_00: Yeah.
• 1:38
  SPEAKER_00: Absolutely.
• 1:39
  SPEAKER_00: So you've run some numbers.
• 1:40
  SPEAKER_01: I have run some numbers for you because I think it's important sometimes.
• 1:44
  SPEAKER_01: We can sit here and talk about it, and people go, oh, that's a nice idea, but why not look at it in terms that we understand money?
• 1:50
  SPEAKER_01: Yeah.
• 1:50
  SPEAKER_01: You know, and so I've got my laptop here just so I don't forget the numbers.
• 1:54
  SPEAKER_01: So forgive me if I'm in and out a little bit.
• 1:57
  SPEAKER_01: So if you're starting with a thousand dollars, so I've put that as a starting point.
• 2:00
  SPEAKER_01: And that we put that the child was born on the first of January this year, just as a starting point.
• 2:06
  SPEAKER_01: So if you put in$20 a week into a balanced fund, the child will end up with$47,000 in their Kiwi Saber by the time they're$20.
• 2:15
  SPEAKER_00: No.
• 2:16
  SPEAKER_01: Yeah.
• 2:16
  SPEAKER_01: But why would you put it in a balance fund for that?
• 2:18
  SPEAKER_00: I was about to ask you, why would you put it in the balance, Dave?
• 2:21
  SPEAKER_01: That's correct.
• 2:21
  SPEAKER_01: So the other is if you put it in a more aggressive or high growth type fund, you're looking at$64,000 by the time they're 20.
• 2:29
  SPEAKER_00: No.
• 2:29
  SPEAKER_01: So and that's just with just putting in that.
• 2:32
  SPEAKER_01: So that's not counting if they've gone to work and they're starting to contribute themselves.
• 2:36
  SPEAKER_01: So think about that as a starting point for your child to get themselves into their first home.
• 2:40
  SPEAKER_00: And hey, that could be a 5% deposit for them.
• 2:43
  SPEAKER_01: Yeah.
• 2:44
  SPEAKER_00: In 2015.
• 2:45
  SPEAKER_01: Absolutely right.
• 2:46
  SPEAKER_01: So it's it's an amazing start for just 20 bucks a week for your kids.
• 2:50
  SPEAKER_01: Now, if we know that it's tough out there at the moment, we get that.
• 2:53
  SPEAKER_01: So I've done some figures around the$10 a week as well.
• 2:56
  SPEAKER_00: Okay.
• 2:56
  SPEAKER_01: So at$10 a week, you're looking at in a balanced fund, it's you end up with about$29,000 at$20,000.
• 3:02
  SPEAKER_00: That's not bad.
• 3:02
  SPEAKER_01: It's pretty good.
• 3:03
  SPEAKER_01: And in more aggressive fund, you end up with$40,000 at$20,000.
• 3:08
  SPEAKER_01: So again, really nice start for just$10 a week.
• 3:11
  SPEAKER_01: Yeah.
• 3:12
  SPEAKER_01: So man, let's encourage mums and dads to start that savings for their child.
• 3:17
  SPEAKER_01: And it's somewhere where mum and dad can't touch it later.
• 3:20
  SPEAKER_01: It's being looked after, and then there'll always be that opportunity for children to withdraw that.
• 3:25
  SPEAKER_01: I don't think that will change that they will be able to use their Kiwi Saver to get themselves in their first home.
• 3:30
  SPEAKER_00: Yeah.
• 3:30
  SPEAKER_00: This is awesome.
• 3:32
  SPEAKER_00: This is really, really cool.
• 3:33
  SPEAKER_00: And for those that missed out on the other episode that I did, and I actually had some awesome feedback coming through about that one, was the tips and tricks to help with your kids' kiwi savers is birthday monies.
• 3:43
  SPEAKER_01: Yeah.
• 3:44
  SPEAKER_00: You know, aunties, uncles, grandparents.
• 3:46
  SPEAKER_01: Yeah, absolutely.
• 3:48
  SPEAKER_00: If especially in the first five years, kids don't know any different than what they're getting for their birthdays.
• 3:52
  SPEAKER_00: Correct.
• 3:52
  SPEAKER_00: If you want to encourage that, you could get cash instead and put it into the kids' kiwi savers.
• 3:57
  SPEAKER_01: Yeah, and it's like we did talk about, you know, there was the old bonus bonds.
• 4:00
  SPEAKER_01: Bonus bonds.
• 4:01
  SPEAKER_01: You know, and and grandparents used to love getting those.
• 4:04
  SPEAKER_01: Yeah.
• 4:04
  SPEAKER_01: So what's the difference is none really.
• 4:07
  SPEAKER_01: This is just going into something cool.
• 4:08
  SPEAKER_01: And that you can jazz it up a little bit and make a little voucher.
• 4:11
  SPEAKER_01: But you know, one of the things we need to do more is sit down with our kids when they're old enough to sit down and understand and show them where the balance is at.
• 4:19
  SPEAKER_01: So if you've been doing it for eight years, the balance could be around ten grand at that point anyway.
• 4:25
  SPEAKER_01: You can sit down with them and go, hey, look, you've got this much money in your Kiwi Saver.
• 4:29
  SPEAKER_01: This is what it looks like in the future, and this is what it means when you start working and just get them to start understanding what it means and start helping our kids be a little more literate with their finances.
• 4:40
  SPEAKER_00: Yeah, absolutely.
• 4:42
  SPEAKER_00: I think that empowers children as well.
• 4:44
  SPEAKER_00: Like that gives them idea, oh, money grows.
• 4:47
  SPEAKER_01: Yeah.
• 4:47
  SPEAKER_01: Yeah.
• 4:48
  SPEAKER_00: Not just on the trees, yeah, but actually it can grow as a balance.
• 4:52
  SPEAKER_00: And I think that will encourage healthier habits with money.
• 4:54
  SPEAKER_01: Agreed.
• 4:55
  SPEAKER_01: And it's a big gap in our world in New Zealand is that education piece between leaving school, going into a job, or leaving university and going into a job and really taking it seriously.
• 5:06
  SPEAKER_00: Yeah.
• 5:06
  SPEAKER_01: But if they've already got a nice little balance in there, it's something they can take seriously.
• 5:10
  SPEAKER_00: Yeah, absolutely.
• 5:11
  SPEAKER_00: I'll tell you a funny story.
• 5:13
  SPEAKER_00: My third child, he came home yesterday and apparently he won second place in the national poem competition.
• 5:21
  SPEAKER_00: This is the whole of New Zealand, right?
• 5:22
  SPEAKER_00: Yeah, right.
• 5:23
  SPEAKER_00: He's only eight years old.
• 5:24
  SPEAKER_00: Yeah.
• 5:24
  SPEAKER_00: And I thought that was kind of cool.
• 5:26
  SPEAKER_00: And uh said, is there a price?
• 5:27
  SPEAKER_00: He goes, yes, 50 bucks.
• 5:29
  SPEAKER_00: So he's won 50 bucks.
• 5:30
  SPEAKER_00: But um apparently his dad told him that he needs to put$20 into shares.
• 5:36
  SPEAKER_01: Yeah.
• 5:36
  SPEAKER_00: And then$30 he can either, you know, some of that$30 he can spend, buy something for us, and donate.
• 5:43
  SPEAKER_01: Yeah.
• 5:44
  SPEAKER_00: So but he knows that out of that$50, the$20 is gonna go into his shares' account.
• 5:48
  SPEAKER_01: Yeah, yeah, and that's cool, right?
• 5:49
  SPEAKER_01: So get some understanding and yeah, it gets him started.
• 5:53
  SPEAKER_01: So yeah, there's nothing wrong with that.
• 5:55
  SPEAKER_00: Yeah, this is really cool.
• 5:56
  SPEAKER_00: Well, David, thank you so much.
• 5:57
  SPEAKER_00: Anything else to share?
• 5:59
  SPEAKER_01: No, that one of the things we talked about previously was you know that that gap between possible men and women with Kiwi Saver.
• 6:06
  SPEAKER_01: So did a bit of research, and overall the Kiwi Saver mix of people having Kiwi Saver, it's about fifty one percent of women are signed up against forty nine percent men.
• 6:17
  SPEAKER_00: We're gonna leave it on as a cliffhanger for the next one.
• 6:20
  SPEAKER_01: I think we should, and I'll bring some figures in next time.
• 6:22
  SPEAKER_01: Sounds good.
• 6:22
  SPEAKER_01: Thank you so much.
• 6:23
  SPEAKER_01: Okay.
• 6:24
  SPEAKER_00: Bye.