WealthDesign

Knowledge is power and there is often a knowledge imbalance when you are talking to your bank.

You want the money when you need it. It might be to buy a new house or car. It might be that you need to increase the overdraft to pay bills or a tax liability. The truth is, normally your stress level is high and you just need an answer – and quick.

But you don’t know what you don’t know. The banks are great at lending us all money – that’s their job, but they are also in business to make a profit for their shareholders. This is why you need to be an informed user of financial services.

Do you know what is a fair fee to set up a loan? Do you know what rebates you can get when you get a new mortgage? What is the best interest set up? Do you know what file notes the bank person is writing about you? Is it fair that a new bank client will get incentives but an existing client gets … zip?

Knowledge is power but you need to go get that knowledge, otherwise you’re just a cash cow to the banks.

We recommend you get independent advice before you talk to the bank – even if you’re an existing bank client. 

Give Leonie here at WealthDesign a call to have a chat. She comes from a banking background so knows how they work. Her experience there along with her vast mortgage knowledge will be invaluable when it comes to your next rendezvous with the bank – whether you’re in the market for a new mortgage or negotiating with your existing bank. 

We have many clients so thankful that they were introduced to Leonie prior to their dealings with the bank – it has saved them thousands.

Call today – 06 3555 844 – ask for Leonie. 

WealthDesign – a life well planned

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Sounds like a title for a movie and a scary one at that! Well zombies and black swans could well have an impact on your KiwiSaver fund, so settle in while I give you the heads up. What you don’t know can hurt you!

Today there is over $10 trillion of US Corporate debt. This debt bubble has been created by reserve banks and governments around the world trying to fix the last financial meltdown by printing money. All it seems to have done is fuel a borrowers feeding frenzy. Companies in the US have been able to borrow capital for next to nothing  – hence the problem. Instead of investing for growth, many companies in the US have just borrowed and bought their own shares back – everyone’s been happy, the share price goes up so the shareholders are happy, the directors pat themselves on the back for making their shareholders more wealthy and the CEOs get bonuses. The only problem is that some of these companies are only surviving because they can borrow cheap money. In a true market they should have gone broke and died – as in become a zombie.

The theory is that companies going broke and then being rebuilt is a healthy part of a thriving market, as it allows new blood to come in and take over the assets, and then rebuild a more efficient business. Artificially cheap money is mucking with this evolutionary system.

Another problem is that around 40% of this $10 trillion debt is BBB credit rated debt, just one step away from junk bonds. The scary thing is we really don’t know who owns all this debt. Think of it like you owing someone a mortgage but you really don’t know who.  Part of me worries that the smart Wall Street bankers have packaged it up and sold it off around the world. It could very easily be hidden in your KiwiSaver fund, and you don’t even know.

If we see a black swan event such as an Iranian War, we could see a GFC scenario with a repeat of 2007.

KiwiSaver is a great thing, you hear me telling you through the years. And it is. But just by having money invested in a KiwiSaver fund is not the answer if you want to ensure your money works for you through to age 65. You need to know how to manage it. The scary movie scenario described above, could play out.

So expect the best but plan for the worst. Review your KiwiSaver now. Make sure you aren’t unknowingly exposed to events that could jeopardise your investment.

Give me a call and let’s check out your KiwiSaver situation and ensure your hard earned funds work for you optimally through the years.

John Barber
WealthDesign – a life well planned

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