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New Zealand Super increase in rates and impact on your tax rate

New Zealand Superannuation income is adjusted on the 1st April each year based on a formula that is linked to inflation (through the average wage mechanism).  With inflation at high levels this year, the jump in NZ Super is quite big.The important thing is - if you are earning income from other sources (working, investments, taxable annuities), remember to check your overall gross taxable income.  This increase in New Zealand Super may push you into the next tax bracket, which will cha...

Investment Market Uncertainty and War

This article is part of a longer article sent to Moneyworks Membership Fee client in mid March.  We are sharing this again as a reminder, and also for the information of Non Membership Fee clients that receive this newsletter each month. The one thing that we can say for certain is that currently the outlook is more uncertain than normal.  While much of the world is getting back to business after Covid, China and Hong Kong are being locked down and/or are suffering from significant wav...

Residency requirements for New Zealand Superannuation changed

In our August newsletter (which you can find here), we outlined the proposed changes to eligibility for New Zealand Superannuation. Legislation was passed in late 2021 to implement these changes. In summary: The residence test to qualify for New Zealand Superannuation increases from 10 years to 20 years, but with a staggered approach, with annual increases in the residence requirement. Those who turn 65 on or before June 30th 2023 will still face the 10 year eligibility rule.Only those who ...

This is why NOT investing in Fossil Fuels is tricky

Ethical investing is tricky.  While something might seem simple on the surface, there are so many layers and factors involved in making a decision to continue investing or stop investing in a particular area.  We will cover many of the areas that make this tricky in future newsletters, but we are starting off with one of the most tricky – Fossil Fuels.We all know that Fossil Fuels (using, producing) are bad for the environment and are a big contributor to climate change.  There ...

Nestle and Child Labour

Nestle is an attractive company to invest in from the financial and traditional profitability perspective and as a consequence, is in many of our clients portfolios. However, there is an ethical issue, in the form of child labour.A study by the University of Chicago estimates that 45% of children living in agricultural areas on cocoa growing areas were engaged in child labour and 43% were engaged in hazardous child labour in cocoa production in aggregate.  Particular areas of concern are in...

Why bother with company visits when you are investing?

In 1987 I was fortunate enough to have the opportunity of working for a huge American Fund Manager, Fidelity Securities in their Australian Office.  It has set the ground for my understanding of investing, financial planning and what a good professional fund manager does.  Of course, times continually change, new types of investments and themes develop, new styles of investing are created, but there are fundamentals that are as relevant now (35 years later) as they were in 1987. I lear...

Spending one bitcoin = 330,000 credit card transactions

Bitcoin (based on Blockchain) and other crypto-currencies have the potential to change the world, but at present are still most useful as a speculative investment tool.  However, to created a Bitcoin requires a vast amount of energy, which challenges the value of Bitcoin as a tool for the future from an ethical perspective. This is a commentary from the Robeco "Stunning Statistics of Sustainable Investing" What has happened?The digital currency consumes 511 kilowatt hours of electricit...

Money Mules and Money Laundering

As a financial adviser, we have responsibilities under the Anti-Money Laundering/Countering of Financing Terrorism legislation.  You will see this when we require proof of ID, residential address and source of wealth and source of funds from you. As part of our obligations we are required to maintain processes and risk assessments and undertake ongoing training of all our team to ensure that we are aware of how money can be laundered. A large part of this training involved le...

Our new look

The Moneyworks logo has been in lower case since 2005, and was green and orange from 2005 - 2015.  From 2015 we changed the logo up, adding the circular logo and swapping green for brown. With the new focus on the ethical components of investing, life and our business, we have returned to the green - and over the next year we will be introducing all our clients to the ethical approach to investing. At the same time we will be making some formal changes within our business to track and offse...

Some comments on those 'wholesale investor only' property syndicates advertised in NZ.

It has been difficult to get investment returns from 'income' investments, with term deposit rates being so low (and virtually no returns on ordinary bank accounts.  Although interest rates are increasing, this means that people holding bond or fixed interest funds will see capital losses (as the investors won't pay as much for the investments held because there are new investments available at better rates). A lot of people are nervous about investing in equities (a flash word for shares) ...

Corporate Controversies that Defined 2021

ISS ESG is the acronym (or brand) for Institutional Shareholder Services and its ESG (Environmental, Social and Governance) arm. ISS a large international company that provides services to institutional investors (fund managers) including proxy voting services and platforms (so that they can place their vote on company issues at annual meetings) as well as extensive research. We are fortunate to be able to receive their white papers and commentaries (as a result of Carey's role judging the ...

More changes for landlords - under the Privacy Act

Owning a residential investment property is a common way to growing your wealth in New Zealand.  However, over the last few years the obligations on landlords have increased significantly, with requirements to ensure that the homes are healthy and warm, and changes to the residential tenancies act, which give more power to the tenants. Another change has been announced recently, from the Privacy Commissioner who has outlined what landlords can and cannot ask potential tenants when they...

Do you really need $809,000 to retire on?

Every two years Massey University carries out an analysis of how much people need to have invested/saved to be able to retire.  The guidelines are based on various assumptions, and as usual, it is vital that you understand what these assumptions are before you start to relate this information to your personal situation. A key part of our role at Moneyworks is to do a detailed analysis for each of our clients based on their actual situation, and work out how much they need to have invested t...

Climate Laggards and Leaders - the poor performance of listed companies

In our big Ethical Investment Analysis project we have found that it is difficult to get information on Carbon emissions from our fund managers that are in a consistent format.  This is a good example of how the field of ethical investing is difficult, there are a number of different formats for reporting, there is disagreement about whether reporting should be on a 'per revenue', 'per profit' or absolute basis. Further, reporting is difficult as there is no mandated consistent measure of r...

Sustainable investing, Climate Change and Sea Level Rise

Climate change threatens 1.1 meter sea level rise before 2100 unless climate change is tackled.Analysis by the International Panel on Climate Change (IPCC) makes the prediction in its ‘Special Report on the Ocean and Cryosphere in a Changing Climate’, which studies the effect of global warming on sea levels. It says 90% of the 1 degree Celsius rise in average global temperatures above pre-industrial levels seen thus far has been absorbed by the oceans, having a major impact on sea life and c...

Flood risks and insurance being withdrawn

Fire & General insurance (or house, contents, car, boat insurance) is different to life insurance cover.  Life insurance (trauma, income protection etc), are a contract that you enter into and it remains in force until you cancel it or it expires (usually when you are very old), or until you stop paying your premiums. In comparison, F&G insurance is an annual contract, which means that you are entering into a new contract with the insurer each year.  What this means is that the insurer...

Insuring your e-bike

Well, I did it. Having heard from my clients about how much they loved their e-bikes I bit the bullet and purchased my commuter e-bike.  The plan is to use it to commute to my lectures in Hamilton (1 1/4 hours ride each way).  I got one ride in, then the weather was foul, then we got locked down.  But I still love my bike (but still ride my non e-bikes as well). So I thought it was important to understand about  whether my fire and general insurance policy covered my e-bike.&...

Getting your unclaimed Australian Super back to NZ

For a number of years, you have been able to bring your Australian Super back to New Zealand IF you are retired and past the age to access the super OR if you put it into your KiwiSaver. The process is administratively time consuming, but after lots of follow ups with the Australian providers we have helped our clients bring their Aust super back into their KiwiSaver.  The funds are ring-fenced and are not available for deposits on houses and can only be withdrawn at the age of eligibility ...

Elder Abuse - help your family hold on to their money

A recent Stuff article reminded us about how invasive and destroying elder abuse can be.  Read more here about the 92 year old who was 'cleaned out' of $500,000 - ‘She cleaned him out’: Family seek answers after 92-year-old ‘left with nothing’ Elder abuse can be physical and or financial.  It can be psychological, sexual, institutional or arise from neglect.  Over 10% of over 65s living in our community experience abuse, but only 1 in 14 abuse incidences are repo...

The Great Wall of Trees

A giant wall of trees that is being built across Africa is making a huge contribution to the UN’s Sustainable Development Goals. The 16 km wide wall of trees, bushes and shrubs crosses Africa’s Sahel region at the southern edge of the Sahara Desert, is now 15% complete. It will eventually span almost 8,000 kms and pass through 21 countries, starting on the west coast in Senegal and ending on the east coast in Djibouti. Started in 2007, the USD 8 billion project is expected to create 350,000 ...

Welcoming a new team member - Grace

Grace joined Moneyworks as our Administration Manager in 2021 and works part-time.  While Millie Moneybot (our robot) does most of the routine administration, there are still a number of things that need to be done by a human, and Grace is helping us by taking the load off advisers, enabling them to spend more time with their clients and researching and analysing investments and financial solutions. Grace was previously the Office Manager at Cityside Properties,  where she looked after...

Sustainable Investing - Climate Change and human activity and how investing can help slow down change

At Moneyworks we use the shorthand terminology 'Ethical Investing' to cover a range of investing styles that can also be referred to as 'Sustainable', 'Responsible', 'ESG (Environmental, Social, Governance).  One of the main things that these 'ethical' investments have in common is that they are looking for investments that are long term, that will make our planet and environment, and human lives more sustainable and last longer.  There are a number of different ways that we can invest...

​ Banks being held responsible for fees, conduct and lending practices

Our banks are an integral part of our lives and pretty much hold us hostage with their fees and decisions, unless we choose to be part of the barter economy, or become self sufficient, we will always have to have an involvement with banks. Over the last year we have seen banks phase out cheques, close more branches, limit branch hours and replace humans with chatbots on line.  While we are active users of technology to make everyones lives more streamlined, some of these changes from the ba...

How to retire - well, how to get ready to change your life

Our byline on our logo is 'Helping you get to and through retirement - ethically'. Yes, this is mainly about making sure that you have enough money to enable you to retire, and that if something happens before you have enough money, that you have insurance to step in to make sure that you get to retirement.  When our clients engage with us and follow our advice, this side of retirement planning works. We have lost track of the number of conversations we have had with clients about the ...

Is your house properly insured - to take into account the rising costs of building in New Zealand?

Covid has seen many industries impacted by shortages - both of clients (tourist businesses), supplies and labour.  Finding a builder these days can be quite tricky, with long wait periods - because of labour shortages, but there are also materials shortages, because of shipping routes and global demand for building materials. It is easy to ignore this if you aren't planning on building or renovating (or going back to the drawing board if you are and the cost and time delays are too much), b...