Income

Your income over your life is vital to your financial planning

At the different stages of your life, you need an income to live from day to day and to achieve your goals.

When you are starting out - in your 20's, your income is likely to be lower than when you are more established in your career.  From age 40-65 your income is likely to be the highest that you are going to have during your life (unless you keep working after age 65 in the same capacity).

You may choose to change your career in your 50's, or pursue a different income earning direction in your 60's, but the amount of income that you need when you stop earning is going to be the major driver of your financial planning.

How much money do you need set aside to be able to stop earning?  

There are a number of factors that need to be taken into account when you are making these assumptions

  1. How much do you think you will receive from New Zealand Superannuation and for how long
  2. Will you work part time?  
  3. Will you receive an annuity?  
  4. What will your tax rate be?  
  5. How much will you be spending on travel and for how long?  
  6. Will your costs reduce as you get older?  The research indicates that your costs are likely to fall from age 75 or 80.

When you work out how much income you need you can work backwards to work out the lump sum that you need to have invested to fund your retirement.

Protecting your income

Because your income is vital throughout your life, it is important to make sure that your income will continue from an income protection insurance policy or mortgage replacement insurance policy  (or that you have trauma insurance cover)  in the event that you are unable to work because of illness or injury.  These income protection insurance policies work in conjunction with ACC, as there are many reasons that you might be unable to work that are not covered by ACC - for example, stroke, cancer, heart condition. 

This should be your core insurance policy during your working years.  There is a big difference in the quality of these insurance policies, for more information on getting the right one sorted for you, contact us by emailing contact@moneyworks.co.nz.

Building or Renovation insurance - who is responsible?

Is it you or is it me? Who covers what when it comes to renovating or building? Is it the Owner or the Builder? This is a question that is often raised late in the piece when considering buildingRead more

The Sky City Fire - who will pay the bill?

The Deconstruction of a Fire At 1:15pm, Tuesday 22nd October a fire broke out on the roof of the New Zealand International Convention Centre in Auckland. Close to 100  construction workers were onRead more

Rental income - new ring-fencing rules

The rules for reporting rental income have changed from the 2019-2020 income year.  This means that you can’t offset losses on your rental properties against other income and new rules apply toRead more

Enduring Power of Attorney - why you need to put them in place

These documents are often associated with ‘old’ people, who are losing their mental capacity.  And yes, we agree, having Enduring Powers of Attorney in place are very important at that stage ofRead more

Using an adviser adds more than 5% to a client's portfolio

Research recently carried out in New Zealand by Russell Investments, recently confirmed the findings in the USA and Australia, that using an adviser can add 5.2% pa to a clients portfolio returns.Read more

Online Relationship Break-Up Tool

The Ministry of Justice has released an online collection of information for people navigating a relationship break up. It says while it has had a lot of helpful information on its website, it hasRead more

Sole Trader vs Company?  What should I do? (with thanks to Beany)

Our support team at Beany are asked this question frequently so if you've ever wondered....... The short summary is that if you are a Beany client there is very little additional cost and 3 keyRead more

Changes to the Trust Law

Over the last 4 (or 17 depending on your source) years new legislation for Trusts has been working it’s way through the consultation and legislative process. It has now been passed into law as theRead more

Renting a vehicle and insurance issues

Read more

Permanent or Temporary Loss of your Capital

Read more

More changes for rental property owners and tenants

On 27th August 2019 - more changes were introduced for Landlords and Tenants - but these didn't seem to have as much publicity as the 'warm and healthy homes' changes but are important. TheseRead more

Walking the Talk - Moneyworks new Wellness Coach and Mobile Fitness Trainer - Sally Mellor

When we meet with our clients we spend most of our time talking about what has happened in the last year, and how clients are going in terms of reaching their goals.  One of the main goals for ourRead more
 

This product has been added to your cart

CHECKOUT