MY BALANCE IS GOING DOWN, SHOULD I BE CONCERNED?

In mid-October, global share markets went through another downturn (since February 2018), before a moderate rebound over the next few days.

Market performance has been positive over the last decade, with the US achieving the longest Bull market (this is when markets go up) in history. Recent share market volatility (markets going up and down) have resulted in an anticipated correction and will have tested the resolve of many investors.

What does this mean for you?

There is no need to panic or take any urgent actions. Equally, it’s important to understand your investments and the level of risks involved. Although saving for retirement is usually a long-term goal, it shouldn’t be a set-and-forget process. News reports on changes in market performance can prompt concerned investors to check savings balances and change funds without considering long term trends.

There are some ways you can be confident your investments are working the way you want. If your circumstances have changed, for example you’re looking to buy your first home, or are nearing retirement, then you should take a moment review your investments.

1) Do you know what investment option your money is invested in? The NZAS Retirement Fund offers four investment options. Three investment options – Conservative, Balanced and Growth are diversified funds. This means these funds invest in a number of different assets such as shares, property, bonds and cash. The other option – Cash, is a single sector option and as its name suggests this option invests only in cash. Make sure you know what investment option you are in and the impact markets may have on the returns. The Commission for Financial Capability’s Sorted website provides a
Retirement Planner that can help you see whether you’re on track financially for the retirement lifestyle you want.

2) Have you spoken to an expert? A financial adviser can provide you with independent guidance and advice on superannuation and other financial services and products. The right adviser can save you time and help you achieve your retirement savings goals. The
Financial Markets Authority (FMA) website provides helpful information about choosing the right financial adviser. If you are concerned about the markets, considering changing funds, investing more money or withdrawing some for example to buy your first home, then speaking to a financial adviser can help refine your goals, and provide tailored advice for your specific situation.

3) Are you a risk taker or like to play it safe? With the Fund, you have access to a few tools to help you work out what fund you should be in and understand the impact markets may have on you. Take a moment to consider what sort of investor you are, and work out what fund option may be right for you. You can also check out the
Investor Kickstarter Quiz on Sorted’s website.

4) Need to withdraw money in the near future? If you are looking to buy your first home or are thinking of withdrawing your money for retirement, it’s important that you understand that the value may go down with the market and allow for that. As you approach a life milestone you may wish to alter your investment options to better reflect your risk profile. Speak with your financial advisor (point 2) about your circumstances and they can help you make the right decision for your situation and goals.

5) Get to know the website. The Fund’s website gives you complete control over your savings. When was the last time you logged in? Accessing your online account enables you to find the latest information including your personal returns and balance, adjust your fund options, and update your personal details. If you have forgotten how to log on to the website, please call the Helpline on 0508 266 787.