Taking Responsibility for your Finances
Life is full of choices and what you do with your choices determines the outcome or what happens in the long term. Taking no action is a choice in itself. As far as finances go, what you do with your resources can make a difference to your life.
In New Zealand and in most countries some form of retirement scheme is in operation.That is where a small percentage of your pay goes directly into your retirement scheme. There are various incentives available to encourage people to contribute toward their retirement savings.
New Zealand’s retirement scheme is called “Kiwisaver” and it is voluntary which means that no one is compelled to join or to contribute to their retirement fund if they do not wish to.
Considering the advantages of belonging to Kiwisaver it is truly baffling why anyone would not want to join.
I have heard all kinds of excuses such as, “I’m not earning enough,” “You can’t take it all with you”, “Other people are not in Kiwisaver.”
These are all excuses and not reasons.
The truth is and the real reason why some people are not involved in KIwisaver or are contributing toward it is because they are irresponsible.
Of course you will not hear any of them admit that.
The bottom line is that it is not up to the Prime MInister to spoon feed people. At some point one has to take responsibility for your own finances.
Irresponsible behavior is a habit and a pattern of behavior. Responsibility is a dirty word to some people and a person who is not responsible enough to join a retirement plan of some kind is likely to be irresponsible in other areas of their life. The number of one parent families is a prime example of this. “Where are the fathers of these kids” is a question I sometimes ask myself when I see a story on TV about single mothers.
Responsibility also means that you must make the decisions on which funds to invest in; those who may be intellectually limited and those who do not have the time to do their research can make the use of a fund manager by investing in managed funds. All money invested into kiwisaver are in managed funds.
Fund managers are skilled and have the kind of financial knowledge that the ordinary man in the street does not but you still have to choose which fund to invest in whether it is growth, balanced, or conservative.
Markets will go up and down which are beyond the control of the fund manager, therefore, do not take your anxieties out of them when the markets are down.
It is certainly a fact of life that some people will let others make their decisions for them so that they have someone to blame when things turn to custard.
You may have a financial advisor but they still need to know what your intentions are as far as your goals in order to make the right choices for you. An investment made for someone who has thirty years left till retirement is not going to be the same as one for someone who has five years to go. It is your responsibility to keep your advisor informed.
That is, if you have an advisor. If you do not then it is up to you to do your own homework. That way, if things turn to custard then the person who is to blame is the one you see in the mirror every morning.
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