As this will be our last article for 2023, I felt it prudent to acknowledge just how much change has happened this year. From the massive and lingering impact of Cyclone Gabrielle, to moving out of COVID response structures, to continued fiscal pain and high interest rates, conflict in the Middle East and continued conflict between Russia/Ukraine, even a change in Government with the first ever 3 party coalition – it has been a very turbulent and uncertain year, and one I imagine many will be glad to see the back of.

As we look to the holidays and the New Year, the same things highlighted by the volatility of recent times remain important; spending valuable time with loved ones, and making a plan for you and your whānau’s future.

There are changes we can control (within reason); where we live, where we work, who we spend time with. What we cannot control is change itself, which will happen whether we like it or not. ‘Resilience’ has become a go-to keyword in the aftermath of COVID, for good reason – resilience and careful planning will help mitigate impacts of change.

We cannot know what change will happen (as the last year has proven), but we can create long-term strategies to minimise risk where possible. This is the same in life as in finance.

Some things you can control:

1.)    Having an accurate, honest view of your financial situation. Knowing the lay of the land is half the battle. While it may seem daunting at first to go through all expenditures, you would be surprised at some of the automatic payments to subscriptions etc. which have been rolling over in the background. You may save yourself a few bucks, and at the very least you will know exactly where you’re starting from.

2.)    Your aspirations for the future and retirement, and the decision to start planning now. Time goes fast, so it is best to start planning for a comfortable retirement now while you are still earning. Accumulating over time through savings and investments will be a lot easier than stumping up lump sums later in life.

3.)    Your KiwiSaver fund. Much like your car, your KiwiSaver is worth a once-over every now and then to tune it up for your needs. Generally, the more time you have, the more risk you can afford to take on. If retirement is still 20+ years away and you’re in a conservative fund, you may benefit from talking to a trusted KiwiSaver adviser and reviewing which fund is most suitable for your needs. Additionally, you can see if your KiwiSaver fund’s investment strategy aligns with your ethical values – so you can do well fiscally and do good by the planet.

4.)    Keeping your tax correct. There is no joy in paying too much tax or paying too little and having to fork out a payment to IRD later in the piece. Make sure your Prescribed Investor Rate (PIR) is accurate from the get-go and you will save both money and time. Check over portfolios and other financial products such as KiwiSaver or PIE funds.

The times, they are changing – but we can make plans to weather coming storms, by applying learnings from the past. When change happens it is typically not the change itself that has the most impact, but the recovery from the event. An oft-cited example would be the 2008 Global Financial Crisis. Investors who acted emotionally and cashed out on the way down missed out on the upswing to follow as the markets recovered. Investors who stayed the course were able to capture returns as the markets did what markets do and returned to the mean.

If one of your New Year’s resolutions might be to get your financial roadmap in order, a good first step is reaching out to a trusted financial adviser for a chat about your unique situation and goals.

Happy holidays, everyone – we will see you in January.

 by Nick Stewart (CEO and Financial Adviser at Stewart Group)

·         Nick Stewart (Ngāi Tahu, Ngāti Huirapa, Ngāti Māmoe, Ngāti Waitaha) is a Financial Adviser and CEO at Stewart Group, a Hawke's Bay-based CEFEX & BCorp certified financial planning and advisory firm. Stewart Group provides personal fiduciary services, Wealth Management, Risk Insurance & KiwiSaver scheme solutions. Article no. 337.

·         The information provided, or any opinions expressed in this article, are of a general nature only and should not be construed or relied on as a recommendation to invest in a financial product or class of financial products. You should seek financial advice specific to your circumstances from a Financial Adviser before making any financial decisions. A disclosure statement can be obtained free of charge by calling 0800 878 961 or visit our website, www.stewartgroup.co.nz