Latest / The Curve / RTC68: The $100,000 reason you need to sort your retirement fund TODAY.

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RTC68: The $100,000 reason you need to sort your retirement fund TODAY. · The Curve

• 0:00
  Welcome to Raising the Curth, a podcast designed to teach you everything you need to know to
• 0:04
  be better with your money. And the wise words of Amy Schumer were slipping carrots into the browny
• 0:10
  recipe. I don't really get the saying. It's kind of like eating vegetables that actually taste good.
• 0:16
  You know, I'm like, still not wearing it. Are you on the script?
• 0:20
  It's basically like saying, investing in finance can be boring, but it totally doesn't need to be.
• 0:26
  Okay, okay, so we're making it fun by putting the carrot. Okay, the vegetables are just good for
• 0:32
  you. It's the browny recipe. Okay, we got there. We got there. Okay, okay. Well, you've really
• 0:36
  got a finance mate. Yeah, one of us has to. This is true. Okay, come and learn alongside me
• 0:42
  from Vick Harris, ex-fun manager, where I'm going to ask all the questions that you wish you could.
• 0:47
  And I'm going to be eating all the brownie you wish you could. It's so not the joke, Vick.
• 0:52
  Okay, just come and talk and learn and laugh with us, because together we really can raise the curve.
• 1:00
  We look like we've dressed in matching outfits. I know we do. I'm starting to become more monochrome.
• 1:05
  Exactly me rubbing off on you. You will remember this time last year, I was wearing red corduroy
• 1:10
  pants with a red jacket. Do you remember those stumps and red chucks, like a rainbowed vomited on you?
• 1:15
  Oh, so I tell me how you really feel. This is our first ever recording London.
• 1:21
  Yes. We've had, well, I've had not enough sleep, but we're not going to bang on about it.
• 1:28
  Essentially, we got back to London last night. We just had a big holiday in Italy, very lucky,
• 1:33
  very fun, potentially a few too many app roles. Firstly, our flight got delayed twice,
• 1:39
  like in Italy, and then also landing in London. And then when I finally got to the house that I
• 1:43
  was meant to be moving into, there was no key out. And I couldn't get inside. So I was just like,
• 1:48
  I was honestly ready to park up and sleep outside the house. So I've probably had about five hours
• 1:53
  sleep. But you're so good at it, like you're a real good bounce backer. Yeah, coffee, caffeine.
• 1:58
  How many of you had? This is my surgeon. Oh, yes. See, I should have got two, and then I
• 2:02
  reckon I would have been swayed anyway. Anyway, retirement. Okay, so I need to talk to you about this.
• 2:08
  So when it comes to retirement, this has been my tactic up until now. Delete any email that I get
• 2:14
  from my QSaver provider. If I just forget about it for now, then it's going to grow in value.
• 2:22
  And then I'm going to look at it in 10 years time and be like, wow, it's looking good. That's been
• 2:26
  my tactic up until this point. Yeah. I guess that's better than a hit in the sand mentality, you know,
• 2:32
  never invest, never look at it. At least you're at least you're investing. That's quite good.
• 2:36
  After you'd banged on about it for a while, I started, I started investing $75 a week
• 2:43
  into my QSaver, which at the time, considering I firstly didn't really understand QSaver,
• 2:51
  I was just kind of doing what I was told. I remember I would say QSaver in your eyes, you just
• 2:56
  I don't think people understand when money goes into their QSaver, what it's actually doing.
• 3:00
  Yes, I don't think people even understand that people are investing on your behalf.
• 3:04
  I had a friend, I said to her, I said, oh, do you have QSaver? She was like, why would I join
• 3:07
  QSaver? It's just the government stealing money. Is that what she said? I thought I was waiting for the
• 3:12
  like, her joking, but she was, she was deadly serious. She thought that either the government was
• 3:18
  going to take him money one day or, you know, I was just like, wow, is she a conspiracy there?
• 3:22
  No, not at all. And that's okay, whatever, that's fine as long as she's saving in a different way
• 3:27
  for her retirement, but I don't think she was. I think the thing that's really started to sink
• 3:32
  in for me and up QSaver is just the idea that you don't actually have to do much. Like as soon as
• 3:38
  you've chosen your account or who you're whether you're a provider or whatever and you're contributing
• 3:44
  regularly, you can kind of sit and forget. Totally. Like the government's tried to make it as
• 3:49
  easy as possible. So that's so good that you see that because it really is, it's so easy. The money
• 3:56
  automatically comes out of your salary if you're employed, if you're self-employed, you kind of have
• 4:01
  to contribute yourself, but you can set up a direct debit. So the money automatically comes out of
• 4:06
  your account. So there's no temptation to spend it, you know, before even gets into your account, it's
• 4:10
  gone. And then the government matches it for every $1,042 you put in a year, the government matches
• 4:19
  that up to $521. So it's probably worth saying for people listening in other parts of the world
• 4:25
  that we're talking today specifically about New Zealand retirement funds. Yes.
• 4:30
  Can we say that is the New Zealand one? But there's heaps of, I mean, most governments have set it up,
• 4:34
  right? Every, pretty much every developed country has a superannuation scheme. Like in Australia,
• 4:40
  they do in the US and the UK where you contribute a certain amount of your salary towards your
• 4:46
  retirement fund. And that's really just because the government can't afford to pay for everyone's
• 4:50
  once they retire, you know, like they need us to all step up and actually contribute ourselves
• 4:55
  to our retirement. So that, and also we all want different lifestyles when we get to retirement.
• 5:00
  You know, if the government was like, here you go, this is all you're getting, you know, some people
• 5:04
  want to make more of an effort in the lead up to retirement. So they have a better lifestyle,
• 5:07
  and that's, that's okay. Yes, because we're talking specifically about can we say that however,
• 5:12
  the premise of saving for retirement is exactly the same. So whether you're living in the states,
• 5:18
  the UK, Australia, a lot of what you're about to share is super relevant. What we want to
• 5:24
  try to do today is kind of make retirement fun and interesting or just little things that you can
• 5:28
  make, little adjustments, things to be aware of to make sure that you don't wake up when you're
• 5:34
  64 and go, oh gosh, I haven't looked at those yet. I have one year into retirement and I, yeah,
• 5:43
  so that I want to have a bougie retirement. Yeah, same. I want to live the drain. I also want to
• 5:49
  bougie now. But retirement saving, Kiwi say, what do you want to call it? It's all about delayed
• 6:02
  gratification, which I find hard sometimes, but it's the constant balance between future you and
• 6:08
  current you. And we get asked this question all the time by people in our community around,
• 6:13
  what is the right balance between living your life now, going traveling, hanging out with friends,
• 6:18
  whatever, versus saving for your retirement and having that life when you're older. And there's
• 6:24
  no clear cut answer. It's like, whatever works for you. But we're going to run through some scenarios
• 6:30
  of, you know, if you are in this fund or if you save this much, this is what your time is going
• 6:34
  to look like. It is really, really important to, and it's a lot of calculators out there on Kiwi
• 6:38
  saver, provide all websites where you can put in. Okay. If I just increase my contributions by
• 6:43
  maybe five dollars a week, what would that look like? I think that's quite a good place to start
• 6:49
  actually, because if you strip it all back, this is obviously coming from a place of privilege in
• 6:54
  terms of saying you could increase it by five dollars. A lot of people are probably genuinely
• 6:59
  so stretched right now that that's actually impossible. But I know for myself, I could still enjoy
• 7:06
  the now while also contributing more, if I'm incompletely honest. And I think also if I'd done a
• 7:12
  calculator or looked at the difference between what I would have if I had, you know, $40 more
• 7:17
  a week going into my Kiwi saver comparative later, less. I honestly think knowing how much more
• 7:23
  that's going to be when I'm older is enough of an incentive for me to just spend a tiny bit less
• 7:28
  now. Okay. Firstly, what is Kiwi saver? Talk to me. What is it? Can you answer this one? Oh damn,
• 7:34
  I can do it. I can do it. No, I'm going to try. Kiwi saver is a scheme set up by New Zealand
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  Government where there's a whole lot of different fund managers and providers who take money
• 7:47
  a certain percentage from people's pay and invest it into companies both in New Zealand and abroad
• 7:53
  to increase that money so that when those people get to an age of retirement, so 65 plus,
• 8:00
  the money they've put in has grown significantly. Yes. Did I know? And that's the episode guys we're
• 8:05
  done. And thanks so much for listening. Yes. Yeah. So it is putting aside money for your future
• 8:12
  essentially is what it is. And the government's tried to make it as easy as possible so that they
• 8:16
  don't have to fund all those Kiwis when they retire. But one thing is that you also don't have to take
• 8:22
  it out at retirement. You know, it's a form of investing. If you don't need it at retirement,
• 8:26
  you can continue to grow that money and keep it invested until you actually do need it.
• 8:32
  But so you don't need to take it out at 65. You could leave it in there. Yeah. But there is
• 8:36
  3.2 million Kiwis that have Kiwis saver, which is quite amazing. And there's only about 2 million
• 8:43
  that don't. Yeah. So over 60% of the population, which is fantastic because it is a great way.
• 8:49
  If you find investing confusing, if you find it overwhelming, you don't know where to start.
• 8:53
  It's a really simple and easy way to at least start investing in a way that is easier.
• 9:02
  If that makes sense. Well, it's pretty hands off. You're not having to pay stocks or pick
• 9:06
  funds or pick what you're investing in. You can basically do your little research piece at the
• 9:11
  star, which might take an hour. And then once you've done that, you can more or less have it come
• 9:17
  out as automatic payments like you do your rent or your mortgage or whatever. Have you heard of
• 9:21
  the marshmallow test stuff? No. And I don't really like marshmallows. But I can like the
• 9:28
  chocolate test. But it's quite a well-known test. And what it does is that you sit young kids down
• 9:34
  and some listeners may may have done this with their kids. I did it with my niece and it was quite
• 9:38
  funny. You sit kids down and you go, you give them one marshmallow and you say, I'm just going to
• 9:44
  go away for a couple of minutes. Do you actually do this with a feeling? Sorry, my sister did.
• 9:48
  Oh, it's so cute. If you sit here and don't touch that marshmallow, when I get back, I'll give you
• 9:52
  two marshmallows. So it's this concept. Your trend introduces concept. If you wait and hold off,
• 9:58
  you'll get double what? You can have now. I would definitely have eaten the marshmallow
• 10:03
  if I was a child. Do you have a hint? Definitely. I was such a little fungus.
• 10:08
  I remember I won an ice cream eating competition. I was like, mom, mom, I won an ice cream eating
• 10:12
  competition. When we're on holiday and mom's like, cool. What do you mean did you have to eat the
• 10:16
  most of everyone? And the fastest, yep. Is that video footage of this?
• 10:21
  But I just remember, I couldn't understand why my mum wasn't stoked. Like, I won a competition.
• 10:26
  Mom, mom, I didn't even say that. But it's quite funny. So this is the concept of delay gratification
• 10:32
  and it's exactly the same with Kiwi Saver. If you're sitting there and you're debating, okay,
• 10:36
  do I put away an extra $100 into my Kiwi Saver? Do I spend it now? You shouldn't be thinking about
• 10:42
  that as $100. You should be thinking about that as it's actually $1,000 that you're spending right
• 10:49
  now. That $100 invested over 30 years at the average rate of the stock market, which is 8%,
• 10:55
  it's going to be $1,000 in 30 years time. So just keep that in mind. If you were to times that
• 11:01
  even by a thousand and then figure out what that was, it would be so much more. Yeah. And it's
• 11:06
  basically not taking the amount you're spending at face value, but knowing how much that would
• 11:10
  compound and grow if you were to invest instead. If you're happy spending that, that's fine,
• 11:15
  but it's just knowing it's not actually $100. It's $1,000. But what Kiwi Saver isn't?
• 11:22
  Because a lot of people are probably sitting there like my friend being like,
• 11:24
  oh, the government's just going to steal all that money. But the thing is, it's not with the
• 11:27
  government. And I think that's the miscommunication is that the government doesn't hold the money.
• 11:34
  It's invested. It's invested. It's in companies in the stock market. So, oh my god, that's a real
• 11:39
  penny drop money. Yes, this was organised by the government in terms of setting up funds and
• 11:46
  Kiwi Saver schemes, but the money is not invested in New Zealand government or Australian government.
• 11:51
  It's in companies, just like if you were investing yourself in sharesies or hatch or whatever that.
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  It's closely. Kiwi Saver is just like the mechanism. So, the money comes out of your pay.
• 11:59
  It goes to the IRD, which is the inland revenue department, the tax department,
• 12:04
  and then they never hold on to the money. They literally will just allocate it to a Kiwi Saver
• 12:11
  provider that you've chosen. And if you haven't chosen one, then they'll decide one on your behalf,
• 12:16
  which we call default Kiwi Saver providers. And they tend to be lower returning and lower risk,
• 12:21
  because they don't want to invest you in something super risky and, you know, you're like, well,
• 12:25
  yeah, why did you do that? So, they tend to choose a pretty lower risk and therefore lower returning
• 12:31
  fund, but they never hold on to it. They don't want to hold on to it. I mean,
• 12:35
  surprising, it's a tax department, you'd think they would, but they don't. Yeah.
• 12:38
  They're literally just a holding pen that's allocating money in their front center.
• 12:42
  I think the biggest risk is that there's, you know, the stock market declines and you lose money
• 12:46
  that way. But that's the nature of investing, is that there are ups and downs. And over the long
• 12:51
  term, the market tends to go up. So, personally, for me, it is the free money that we get from
• 12:56
  the government. Like, that is a no-brainer. When do we ever get free money from the government?
• 13:02
  You know, so how it works and it's called a member tax credit is that for every $1,042, you put
• 13:10
  in a year, the government will match that up to $521. So, for 50 cents of every dollar you put in
• 13:18
  up to a certain amount, at $1,042, they'll match it. So, if you put in less than that amount,
• 13:23
  they'll match less. So, we all want to be contributing over $1,042 a year. So, even if you're
• 13:31
  feeling pretty, you know, tough at the moment, times the time, if you're really struggling to pay
• 13:34
  for groceries or whatever, totally here. But if you could just manage to find $1,042 a year,
• 13:42
  and it doesn't matter what time of the year you put it in. If you spread it over the year,
• 13:45
  if you put it in all at one time, it doesn't matter. If you can find $1,040 a year,
• 13:51
  you're going to get that $521 from the government. You're getting that automatically, no matter
• 13:57
  if the market's up, down sideways, whatever, around in circles. I remember this time last year,
• 14:02
  and you reminded me that I need to put more in and I did, and I was quite panicky, that I wasn't
• 14:07
  going to get it, because I thought, are they going to know? And then I just got a, I can't
• 14:12
  remember what it was, but a notification saying that it had come through, and I was like, oh my
• 14:16
  god, this is quite cool. If you forgot and didn't get that $522 a year, that can add up to being
• 14:22
  over $100,000 a retirement. How long is that over? That's over 30 years. So that's me now. If I don't
• 14:28
  every year, if I didn't put in the minimum, I missy out on $100,000 when you reach retirement. See,
• 14:33
  that is like, yeah, but that's a no-brainer. But for us women, Kiwi Saver is very, very important as
• 14:42
  well. Yes, I know, because we live longer. Yeah. But also, we retire with an average of about 20
• 14:50
  percent less than men, according to the retirement commission in New Zealand. We need to make sure
• 14:57
  we are really, really focusing on making the most of our Kiwi Saver now. Not when we close,
• 15:04
  getting closer to retirement, but we need to do it now. Firstly, get out your phone. Yeah,
• 15:08
  okay, get out your phone and make some notes. And no, get out your phone. Okay, don't do that.
• 15:13
  Listen to that. Not me. And put a reminder in your calendar, a recurring reminder for every single
• 15:21
  year for the next 30 years, to check your Kiwi Saver balance right now. So what date is it? Mid-June.
• 15:30
  Even put it for the beginning of June. Let's give ourselves a little bit of time. Put it on and
• 15:34
  put in capitals. Check my Kiwi Saver balance. And I want you to make sure that you check every year
• 15:41
  that you have that $1,042 in there per year. So you're not missing out. I'm going to make my
• 15:47
  calendar reminder pink. Nice. Or a color that no other reminder is. In fact, maybe I should make
• 15:53
  all my finance reminders a certain color. That's a good idea. That's actually a really great idea.
• 15:57
  Money. Oh, yeah, good idea. Yeah. But there is a reason that we have such low
• 16:03
  Kiwi Saver balance as this is meant in that. Can I guess? Yep.
• 16:07
  It's because we take time out. Yes. Yeah. That's one of the biggest reasons. Because a lot of
• 16:11
  people might do five years, 10 years or even a few. Yeah. And you're not contributing during that
• 16:16
  time. Yeah. And that's what we call the motherhood penalty. So apologies, mothers out there.
• 16:21
  Because we take time out of the workforce, look after family or look after children,
• 16:25
  we tend to not contribute or contribute a lot of amount. And that really, really impacts our
• 16:29
  Kiwi Saver balances. I wonder what the way around that is. I wonder if there's any husbands
• 16:34
  or partners where one person's taking time off and the others not, where they almost contribute
• 16:39
  on behalf of their partner. I wonder if there's some or they split their contributions during
• 16:44
  that time when the other person's not working. Yeah. Well, the government now has recently come
• 16:49
  out and said that from next year, so from the 1st of July 2024, the government will contribute
• 16:56
  3% to people who receive pay parental leave, but also contributing 3% to their Kiwi Saver. So you
• 17:02
  must, you have to, you have to contribute 3%, but the government will also match that 3%, which is
• 17:08
  yeah, I mean, it's still not going to be the same because a lot of people have get paid less
• 17:13
  on parental leave, but it's a step in the right direction. But it's one thing to remember if you
• 17:17
  are taking a career break or taking time out to try your best and it is hard because you've got
• 17:23
  an additional expense of a child. I think it's just also planning in advance knowing that you're
• 17:29
  doing that and having a conversation with your partner around the best way to make sure
• 17:32
  that things are nice and even. Yeah. Or as even as possible. And what does that look like?
• 17:37
  Yes, definitely. I feel like I would want my partner to contribute to make Kiwi Saver.
• 17:41
  Yeah. If I can't contribute, you know, I would want it, I'd want to look at what they're
• 17:46
  contributing and what I'm contributing. Yeah. And if mine is less, that would be a conversation I
• 17:52
  would want to have. Yeah. I don't know what it would look like. Yeah. Because it used to be that
• 17:57
  Kiwi Saver wasn't part of your asset. So if you got divorced, then Kiwi Saver wasn't included as
• 18:03
  an asset. And that recently changed because, you know, people that the partner that was working
• 18:10
  or continued to work or was earning a higher amount could put, you know, 10% of their salary away.
• 18:16
  And then that's effectively not counted as part of the assets where it is. It's your earning income.
• 18:22
  It's your. It's a huge capacity. Yeah. So that's good. But we shouldn't rely on that.
• 18:27
  No, but also if you're listening to this and you're thinking how does it work when you're married
• 18:32
  and when you're not, we have done a really great episode with Lauren Aspen and it's called
• 18:37
  everything you need to know about prenups. Yeah. So if you are interested in understanding how
• 18:43
  retirement funds, how you're earning the like your income, how everything is split in a situation
• 18:49
  should your relationship break down. That's a great episode to understand. But yeah, Kiwi Saver
• 18:53
  a retirement fund is now included as an asset that is divided as a relationship property,
• 18:59
  which basically means unless you have a contracting out agreement in place, it's split 50-50 when
• 19:04
  you separate a few separate. Yeah. So if you've had Kiwi Saver since you're 18, a lot of
• 19:12
  questions we get is like, how do you know that you're in the right fund? How do you know that you're
• 19:15
  doing it right? You don't want to get to 65 and be like, oh gosh, I hadn't realized my different
• 19:20
  options or that I should have been in a growth fund and I was in a conservative. What is a conservative
• 19:25
  fund? What is a growth fund? Do you? There's lots of questions and mechanics when it comes to Kiwi
• 19:29
  Saver. And so can we just pause for a second? Then you're on who's listening and doesn't really
• 19:33
  understand what those mean? Conservative would be the lowest returning and therefore the least
• 19:37
  risky, right? Yeah. And so if you're in a conservative fund, the kinds of companies that your
• 19:43
  money is being invested in is supermarkets or, you know, stable companies. Sorry, the stuff
• 19:49
  that would that a conservative fund investment is very little investments in stocks. It's more
• 19:54
  bonds cash that kind of thing because it's very low risk. And so when it's low risk and therefore
• 20:00
  low returning in terms of what you're getting back on the money that's invested. Yeah. What would
• 20:04
  an average conservative fund ish? Is it like low, like two, three percent? Yeah, very, very low.
• 20:10
  And it depends on what the market's doing as well. Why would you even bother being in that though?
• 20:13
  If you're closer to retirement, then it's really good to be in a lower returning conservative type
• 20:20
  fund because you don't want to lose what you've just built up and what you've brought in. Whereas
• 20:24
  if you're younger and say you've got, you know, 10 years plus total retirement, you know,
• 20:29
  most of you should be in a growth fund where it's higher returning. You've got a large proportion of
• 20:36
  that fund is invested in the stock market. And would this be a balance or is this a high growth?
• 20:40
  High growth. Yeah. And then balance is in the middle. So with balance to be some cash, some bond,
• 20:46
  some stocks. Yeah. And a growth fund would be majority stocks. Yeah. Yeah. And that's because stocks
• 20:52
  are a more high risk asset, which also means it's going to be more volatile. So it's going to move
• 20:58
  up and down. Don't be freaked out. If you're in a growth fund and you look at your statement and
• 21:02
  you're like, oh gosh, it's doing terribly or it's not growing like I thought it would. That's
• 21:10
  normal. Just chill out. You've got a while. If you're young and you're in a growth fund,
• 21:14
  remember that Kiwi Savers designed to be an investment up until 65. You've got ages.
• 21:21
  If you're worried about the volatility of the market and it's panicking you to see it going up
• 21:26
  and down quite a lot, would you be better to move it into a different fund, like into a conservative
• 21:30
  or balanced or is it more just realize that this is the reality of investing. And if it's panicking,
• 21:36
  you just don't check it, leave it for six months and then look back because you don't actually need
• 21:40
  that money for a very long time. So try and not think about it. Yeah, I would say the later,
• 21:45
  that like the number of people that get caught up in the day-to-day movements of Kiwi Savers,
• 21:49
  like you can't get it out. Almost the best thing about Kiwi Savers is that you're locked in
• 21:55
  until you retire. You cannot touch it until you retire. I mean, you can take it out for your first
• 21:59
  home if you want, but that's a whole another conversation. But yeah, if you are wanting to buy a house
• 22:05
  in the next six months year, that's when you can reconsider what fund you're in in terms of
• 22:11
  conservative, balanced growth, right? So as you approach that goal, whatever it is, if it's
• 22:16
  retirement of 65 years or if it's a house, say in a couple years, you should be moving down the
• 22:22
  risk spectrum because you want to protect that money that you have made essentially. So that's why
• 22:29
  we say, yeah, as you approach retirement or you approach the goal of purchasing your first home,
• 22:34
  just make sure that you are adjusting your Kiwi Savers fund or your risk profile.
• 22:40
  One thing that I have been thinking about is the fee structure because I know we've done a
• 22:48
  few events like years ago and we did Kiwi Saver events and you explained the fees and stuff
• 22:53
  and honestly, I kind of switched off. So I don't know. When I'm picking up, there's a lot of
• 22:57
  switching off when I talk. That's what I got from that sentence. No, that is a really good question.
• 23:03
  And there's such a debate around what is important when looking for Kiwi Savers provider. Is it
• 23:08
  fees or is it performance? And I like to say both. You know, a lot of Kiwi Savers providers will
• 23:13
  market and advertise their low fees, but it's really important to be like, okay, what performance are
• 23:18
  they generating? So as an example here then, if someone says, I've got a real cheap product,
• 23:23
  real, real cheap, it's come by it and then you buy it and then it falls to bits. And it's like,
• 23:28
  you are sometimes paying for quality. Yeah. It's kind of like in a supermarket where it's like,
• 23:34
  low fat, low fat, it's like, yeah, but it's super high sugar. You know, it's kind of like,
• 23:38
  what are you not saying? I don't know. So a lot of Kiwi Savers providers, and I'm not saying that
• 23:42
  they're all like all like this, they're trying to pick their angle, you know, and it's like,
• 23:45
  oh, we're low fees. We're high returning. We're conscious and busy. Yeah. So it's kind of picking
• 23:51
  your, picking your niche in the market. And so, but it's really important to check both. If you're
• 23:56
  looking at a Kiwi Saver provider and they've got really good performance and by good performance,
• 24:02
  I mean, look at the longest time period. So don't look at three months, one month, one year,
• 24:08
  and make sure it's after fees. So that's actually what you're getting as a return on your fund
• 24:14
  after fees. So if you're looking at a Kiwi Saver provider and they've generated 10% return per
• 24:21
  year over the long run on average, and then they charge you 1% fee, then 9%. Yeah. Let's say 1%
• 24:31
  is quite high. If you're then looking at another Kiwi Saver provider and you're going, okay,
• 24:36
  cool. Their performance is is 8%, but their fees are only 0.5% of a percent, then I'm getting
• 24:46
  7.5%. So it's still lower than the high fee Kiwi Saver provider. The thing is make sure you look
• 24:53
  at fees, but look at them in relation to performance because I would, I don't want to be in a low fee
• 24:59
  Kiwi Saver provider, but getting a really terrible return because that's what's going to impact
• 25:05
  me in the long run is the return. You know, past performance is not even the case future returns.
• 25:10
  It's hold on. I hate when you used to say this because it never made sense. I'm just going to pause.
• 25:14
  Okay. So past performance. No, no, I'm explaining this. This is me, this is my time to shine. So
• 25:20
  what a Kiwi Saver provider has done in the past, so if it's saying look at the long-term performance,
• 25:25
  if they've done that for 20 years, that doesn't necessarily mean they're going to do that for the next
• 25:29
  5, 10, 15 years. There is only so much research you can do and there is only so much that you
• 25:36
  can educate yourself on at the end of the day, it is kind of out of your hands. So you make the best
• 25:41
  and most educated decision, you make an effort to look at performance and after fees so that you can
• 25:47
  see and you can make a decision based on what they invest in, what their returns are on average,
• 25:53
  and then kind of hope for the best. And then you make a decision about how much you can contribute,
• 25:58
  you know, whether you can contribute above that 3% and you make a decision to ensure that you're
• 26:04
  getting that free money every year. If you can do those three things, you're pretty set up
• 26:09
  for a really good retirement. You know, we've kind of talked about the idea that you don't have
• 26:13
  control of what's being in what you're investing in with Kiwi Saver, but you actually do as well,
• 26:18
  don't you? You can see what that fund invests in and decide if you feel comfortable with what it
• 26:24
  is that that particular because there's a lot of funds that invest in some questionable
• 26:28
  shifts. So a great platform is mindful money where you can look and see what Kiwi Saver providers
• 26:34
  invest in and see if that's what you want to be exposed to and if it's aligned with your values,
• 26:40
  if you are suddenly going, oh gosh, I don't even know how my Kiwi Saver provider is.
• 26:43
  Don't panic. You can contact the IRD as well, so then then we're in your department and that will
• 26:48
  say who your Kiwi Saver provider is with and how much you have contributed this year and if you
• 26:52
  need to put in more or if you're sweet, and then you can sit and forget. Okay, great. And relax.
• 26:57
  Go over one or coffee. Whatever time you listen. All you put that in your Kiwi Saver if you don't
• 27:02
  want to spend an hour, exactly. Yes, that's going to be worth a lot more. Did you have any like last
• 27:09
  minute final like words of wisdom that are motivating people to really care about retirement?
• 27:15
  Someone is sitting in the shade today because they planted a tree a long time ago. That is a really
• 27:20
  good thing. But a chink. Okay, but now the one. Sorry, I've just got one more. I've got
• 27:24
  a mic. Yes, sorry. No, not so much. No, because the trees, yeah, whatever, but do you want to be
• 27:31
  sitting on the beach in Greece in your retirement? Do you want to be living in Mexico drinking a
• 27:38
  margarita a day? Think about what you actually want to be doing when you've stopped work.
• 27:43
  Yeah. And think because then you're kind of picturing what life could be like. Or do you want to be
• 27:48
  having to work because you haven't saved enough? And therefore you don't have the excess time to
• 27:52
  spend time with grandkids or family or that's a way to do it on the beach. But hey,
• 27:58
  everyone's retirement is different, but it's just, you know, having the choice to spend your
• 28:03
  time at how you want. And on that note, that was a mic, right? Cool. Bye.
• 28:08
  Thank you so much for listening to Raising the Curve. These conversations are designed to
• 28:12
  teach you everything that you need to know to be better with your money, from saving, to investing,
• 28:17
  to talking to your friends about your salaries. And if you liked what you heard, we would love it.
• 28:22
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• 28:28
  and it would really make our week, our year, our month. Okay. Lots of love. See you soon. Bye.