WealthDesign

Some of you may know we recently visited our daughter Meg, in Europe during August.  Great trip.  Awesome to spend time with our girl.  Meg’s been in Rome now for seven months, attending LUISS University.  We got to relax, and be shown around by our very own tour guide!  

Been home now for almost a month.  This morning we get a call from the fraud department of our bank.  “Good morning Mr Barber, we’re just investigating your credit card spending. Did you book an $8000 air flight to Lithuania on the 25th of September?”  Our visa card has somehow been compromised.  It was fascinating to discover how these fraudsters tested the visa limit on our credit card.  First they put a $1 transaction through Paypal.  Then, at a later time, they tried to buy the $8000 flight.  All this, we suppose, to test how much money they could charge to it.

The card details must have been taken only when being used to pay for something, as the rest of the time it was in a RFID credit blocking sleeve, in our wallet.  Scary, huh?

Before we left, we gave all our travel dates and destinations to our bank, to keep on file.  It was because of this, that they were able to pick this up so quickly.  The bank advised us to check our visa balance at an ATM before we left New Zealand, and on return to New Zealand, which allows the bank to have an electronic trail of our whereabouts.  (So we chose to pay with our visa cards in duty free  – fill up the liquor cabinet – and ensure the bank knows where we are!)

So, remember if you’re travelling overseas, go and let your bank know your itinerary – just in case!

John and Kristine Barber

read on...

The total KiwiSaver balance for all investors is now $ 19.94 billion of savings. Who said New Zealanders don’t save?

With rising investment balances, investors need to consider the fees they are paying and which asset allocation they are invested into. In some cases they are paying top fees for the lowest return.

We have access to independent research that can compare fund with fund and manager with manager. Fees and performance really matter, and you need to be an informed investor. This is especially important as most of the marketing around KiwiSaver focuses on things like access to your KiwiSaver balance; not the real issues of fees and performance.

Our door is always open and we are happy to help you become an empowered investor.

read on...

In the budget this year the government announced funding for health would be a record $15 billion.  And we expect it will continue to see new records in the years to come.  Under 13s will now get free GP visits and prescriptions too, and more money is being allocated to things like bariatric surgery, elective surgery and colonoscopies. 

Sounds good huh?  Tell that to the people who are still waiting to get onto a waiting list.

A study by TNS Research showed around 280,000 New Zealanders were in need of elective surgery, with public waiting times commonly in excess of 12 months.  The government’s statisticians will tell you there are 110,000 people on waiting lists.  This means another 170,000 are not even on the list!   So while the kids may be able to get to a GP even after tea time, mum or dad might not find it so easy to get surgery. 

Health insurance, ACC, and personal payments provide more than half the elective surgery in this country, and the trend over successive years has been for more and more surgery to be funded outside the public health budget, no matter how big it gets.

Further reading here at the Health Funds Association annual report, published this week.

http://www.healthfunds.org.nz/pdf/2014%20annual%20review.pdf

Regan Thomas

read on...

Recently Graeme Wheeler, the Governor of the New Zealand Reserve Bank (NZRB) increased the official cash rate again, to 3.5%.  For months he has been talking up this process and as a result the New Zealand dollar has appreciated from $.79 US to $.87. This is great if you are off overseas on holiday, but if you are in the productive sector, have a business overdraft, or if you have a mortgage, you could be forgiven for being a little peeved.

In my opinion, the system doesn’t work as it should.  Auckland house prices continue to push ahead because of demand and the Christchurch rebuild is pumping money into their economy. The New Zealand dollar is now one of the most traded currencies in the world and our main exporters are hurting big time.  We are also the target for the carry trade (investing in New Zealand for higher returns) and the NZRB seems to use information that is either outdated, or completely corrupted by data out of Auckland and Christchurch.  How we ever get the message to these guys in the ivory towers that the provinces aren’t suffering from inflation, is beyond me. Inflation infers that wages are increasing or people expect asset prices to rise in the future.  With profit warnings from all the major retailers, it is clear that people aren’t spending. This, along with dairy farmers putting their chequebooks away due to the bleak dairy forecast, makes me wonder if the NZRB is completely out of touch with the real world.

For what it’s worth, I think Graeme Wheeler should either get in his car and come and talk to people in the provinces, or find a real job!

John Barber

read on...

Women have always fought for a better deal for their children, for their families and for women in general. In fact, New Zealand women have lead the world in making progress for women’s rights, starting as far back as Kate Sheppard’s charge for women to vote in a national election.

The What Really Matters Report from Aegon UK has found that despite 71% of mothers saying the financial security of their children is among the top priorities in their life, 57% of mothers have no protection cover at all, and 49% have never discussed what would happen in the event of their death.

The report also says that 72% of mothers go out to work to support their families, but are underestimating their financial importance to the family unit. Even Forbes Magazine reports that a stay-at-home mum is worth $113,000 a year.

While the Aegon research is from the UK the average New Zealand experience is likely very similar. As an adviser, I frequently encounter families that have under-estimated the potential financial loss from the death of the mother. Recently we have seen news stories about dependent children publicly appealing for help to pay the mortgage after their mother died.

Nobody wants that to be their legacy, and a reliable adviser is pivotal in helping translate your priorities into the most appropriate actions to protect your family’s future. For around the price of a cup of coffee per week a 40 year old woman can buy $250,000 or more of life insurance. Talk to us.

Regan Thomas

read on...