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125 posts

Master Geek
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Topic # 240786 26-Sep-2018 09:13
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I have some term deposits maturing next month and would like to give investing in shares a try as the current rates with banks are not good (my current TD is at 5.5%). I have around 20-30K to play with. This will be my first time with shares apart from Kiwi Saver. I started reading about a few start-ups e.g Sharesies but am still having trouble deciding which is the best to go with. I read that Sharesies is targeted for investors with 5K or less. I was hoping for some comparison tables e.g. investment amount / term / total amount less fees. I think I can lock it for between 3-5 years.


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Uber Geek
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  Reply # 2096550 26-Sep-2018 09:22
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Sharsies is more cost effective for lots of small regular transactions, so rule them out for this. I'd add Simplicity (non Kiwisaver) to your list. Very low fees due to non-profit structure, invests in Vanguard ETFs




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Master Geek
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  Reply # 2096670 26-Sep-2018 10:55
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nickb800:

 

Sharsies is more cost effective for lots of small regular transactions, so rule them out for this. I'd add Simplicity (non Kiwisaver) to your list. Very low fees due to non-profit structure, invests in Vanguard ETFs

 

 

Have checked Simplicity and it seems they have recently brought down entry level from 10 to 5K. Will research more about it.


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Master Geek
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  Reply # 2096678 26-Sep-2018 11:04
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CrashAndBurn:

 

I have some term deposits maturing next month and would like to give investing in shares a try as the current rates with banks are not good (my current TD is at 5.5%). I have around 20-30K to play with. This will be my first time with shares apart from Kiwi Saver. I started reading about a few start-ups e.g Sharesies but am still having trouble deciding which is the best to go with. I read that Sharesies is targeted for investors with 5K or less. I was hoping for some comparison tables e.g. investment amount / term / total amount less fees. I think I can lock it for between 3-5 years.

 

 

I'm sorry, did you say your current term deposit rate is 5.5%?




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Master Geek
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  Reply # 2096731 26-Sep-2018 11:52
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Nate001:

 

CrashAndBurn:

 

I have some term deposits maturing next month and would like to give investing in shares a try as the current rates with banks are not good (my current TD is at 5.5%). I have around 20-30K to play with. This will be my first time with shares apart from Kiwi Saver. I started reading about a few start-ups e.g Sharesies but am still having trouble deciding which is the best to go with. I read that Sharesies is targeted for investors with 5K or less. I was hoping for some comparison tables e.g. investment amount / term / total amount less fees. I think I can lock it for between 3-5 years.

 

 

I'm sorry, did you say your current term deposit rate is 5.5%?

 

 

Yes it was. Unfortunately it is maturing next month and those rates are nowhere to be found hence am looking at alternative options.


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Master Geek
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  Reply # 2096742 26-Sep-2018 12:06
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CrashAndBurn:

 

Nate001:

 

CrashAndBurn:

 

I have some term deposits maturing next month and would like to give investing in shares a try as the current rates with banks are not good (my current TD is at 5.5%). I have around 20-30K to play with. This will be my first time with shares apart from Kiwi Saver. I started reading about a few start-ups e.g Sharesies but am still having trouble deciding which is the best to go with. I read that Sharesies is targeted for investors with 5K or less. I was hoping for some comparison tables e.g. investment amount / term / total amount less fees. I think I can lock it for between 3-5 years.

 

 

I'm sorry, did you say your current term deposit rate is 5.5%?

 

 

Yes it was. Unfortunately it is maturing next month and those rates are nowhere to be found hence am looking at alternative options.

 

 

Ok I thought you had a current offering of 5.5% and you thought that was bad...

 

Considering you are moving your funds from a (very) safe environment into one that has a lot more risk, perhaps getting some professional advise is a good idea. fees.

 

Obviously you will need to consider how much risk you are willing to accept for the desired growth. You can always set up an trading account with the likes of ASB or ANZ and do it all yourself, but you will have to be willing to read up the companies and judge which is best for what your needs are to build a balanced portfolio. Have you looked into managed funds? If you are willing to pay the fees it could be a good option for you.




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Master Geek
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  Reply # 2096748 26-Sep-2018 12:21
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One other option I had a look at is Term Pie Funds, but the rate is also not that great. I do agree that to get a better return would mean fees and risk. From what I read so far, I was planning is to spread 30K as 50/30/20 on Growth/Balanced/Conservative respectively to spread out the risk. I guess my question would be, if I do what I am planning to do, what are the chances of me getting a return of at least between 8-10% per year and also the chance of making a loss in 3-7 years. Or what is the next safest option out there?


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  Reply # 2096757 26-Sep-2018 12:35
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I don't think it's realistic to aim for returns of just under 10%.

You'll only potentially get those from higher risk strategies on share market which is currently in the longest bull run since ww2. A correction is coming. When it's unsure but I'll surr it will happen in the next 4 years at least...

How long do you want to lock your funds away for ?

Do you have a mortgage ? Would the funds be better being used to reduce debt?

Are you prepared to lose 20% in the next few years before things improve ?

How about keeping the cash liquid wait for the crash and buy on a dropping market rather than buy towards the end of a rising one.

I have bought passive index share units for many years. Ie Snartshares with funds spread out in nz au usa and Asia Pacific.

I also have aggressive growth kiwisaver but then I still have 25yrs of income earning and I am debt free currently.

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  Reply # 2096759 26-Sep-2018 12:37
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Sharesies is a very simple service that buys from the NZX Smartshares portfolio, but only a subset of them. (https://www.smartshares.co.nz). They charge an admin fee, but have a nicer front end than NZX and are a little more flexible. 

 

I can't attest to the quality of investment inside Smartshares, and whether they are riding the wave of global market growth vs really doing something. They are PIE, their funds are Exchange Traded Funds (ETF's) meaning you can buy and sell direct as if they are shares. Note that NZX will do the buying on your behalf on the 20th of the month, but for selling you need a brokerage account like First Direct etc, meaning it costs a minimum of $30 per sell trade. But equally you can buy them from the NZX at any time, so you can take advantage of moves up and down during the month... again $30 every time, although you might find cheaper brokerage's around. 

 

Investnow has quite a wide selection of funds from quite a few of the global players, and definetly worth checking out just for their range. Note that buy/sell orders can take up to 5 business days to process. They are a PIE as well,  their online processes are fairly slick.

 

Neither of the above are Kiwisaver, but they do allow you to buy units in funds, which is infinetly more flexible than kiwisaver is (which is literally "just give us the money and we will do things", which I find very restrictive).

 

Forsyth Barr allow you to buy bundles of shares directly rather than funds, so might also be worth doing.

 

 





________

 

Antonios K

 

 

 

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Master Geek
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  Reply # 2096763 26-Sep-2018 12:44
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How long do you want to lock your funds away for ? 3-7 years. Can be longer but I don't think I will need it in the next 3 years. I have a buffer in way of 3 months emergency fund.

 

Do you have a mortgage ? Would the funds be better being used to reduce debt? No significant debt. Mortgage free in 2 weeks time.

 

Are you prepared to lose 20% in the next few years before things improve? I don't mind as I can just let it ride. Hence I plan to spread the risk e.g. NZX50 then ASX20 if I go with Sharesies.

 

How about keeping the cash liquid wait for the crash and buy on a dropping market rather than buy towards the end of a rising one. If it happens in the next 4 years, what other options would you suggest to park it safely?

 

I also have aggressive growth kiwisaver but then I still have 25yrs of income earning and I am debt free currently. I am on growth as well on 8% contribution.


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Ultimate Geek
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  Reply # 2096804 26-Sep-2018 13:03
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https://www.reddit.com/r/PersonalFinanceNZ/





The little things make the biggest difference.

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Ultimate Geek
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  Reply # 2096920 26-Sep-2018 15:16
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I use TDAmeritrade because I want to invest in the US market not in the NZ one.


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Ultimate Geek
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  Reply # 2096922 26-Sep-2018 15:18
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I have been using InvestNow for the last 6 months as a front end for my Index-linked portfolio.

 

The funds I am actually in are the SmartShare Global and NZ and have seen good return over the last 6 months on those. They also offer access to the US Vanguard funds amongst others.

 

I found it easy to setup and easy to manage - we are currently only investing $1000 a month at the moment, but looking to increase.

 

I believe the minimum monthly is around $50





.

IcI

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Ultimate Geek
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  Reply # 2097119 26-Sep-2018 21:21
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CrashAndBurn: ... would like to give investing in shares a try ...

 

Considering you want to give this a try, are you sure you want to invest it all in one go? Are you going to put in the time to investigate the background of every company / fund that you want to buy shares from & then keep monitoring to ensure you make no losses. Why not try out several strategies with smaller amounts? Spend $x with Sharesies, spend $x with the likes of InvestNow / Vanguard / SuperLife and give yourself the same amount to actively manage. Then you will learn soon enough how much you are willing to be actively involved in the day to day business of buying shares. Adding some extra $$ to your emergency fund until you know which strategy to pursue is not a bad thing. Also, others have mentioned success with P2P loans in the range that you are looking at.

 

If you want to be involved in trading shares, Sharesies is too simple in my opinion.

 

  • You can look at your portfolio performance over 1/3/6/12/60 months
  • When you buy shares, you only have a select few options to choose from
    Sharesies current stock listings
  • stating the amount you are willing to use
  • and then wait ±6hrs for the confirmation email.
  • To sell, you select the stock, enter amount of shares & press sell. Wait for confirmation email.
  • At $5 per month, they certainly are an easy option to try if this is to your liking.
  • You certainly can get a small jolt of excitement or loathing as your pink line creeps up or down.

If you give Sharesies a try, you know where I would spend the $5 referral bonusmoney-mouth

 

Edit: Forgot about the P2P option.




125 posts

Master Geek
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  Reply # 2097173 27-Sep-2018 05:48
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I am leaning towards this approach e.g. join InvestNow/Sharesies/Simplicity. Let's say 10k for each then spread between 3-5 different funds. I only plan to check on performance every 3-6 months then decide which funds I will top up. At this stage I have no plans on sharetrading daily like some people do as I do not have either the time or skillset hence I always end up with TD's. Since I will be mortgage free in 2 weeks time is why I decided to try something riskier. I always save a percentage of my income towards my emergency fund so that will continue. I did have a look at P2P before to the point of creating an account. But then I ended up where I read about it, then say I will do it but never did. But now that my current TD is maturing, I am getting forced to take action else it will end up on a TD again at a much lower rate.


347 posts

Ultimate Geek
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  Reply # 2097204 27-Sep-2018 09:00
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This is quite a good blog for comparison of NZ based share fund offerings eg Sharesies, SmartShares, Superlife etc

 

 

 

https://thesmartandlazy.com/2017/06/28/sharesies-beta-how-does-it-stack-up-to-superlife-and-smartshares-on-etf-investing/


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