Best Potofolio for Retirement

[Alex the not so great]

Just in case there are other people like me who are investing for retirement, what are your thoughts on best NZX shares for a retirement investment portfolio?

[CJ]

Are you in retirement or just trying to build a nest egg which will be used in your retirement.

[Alex the not so great]

Are you in retirement or just trying to build a nest egg which will be used in your retirement.

I am looking forward to retiring in 3-5 years.

[Dr_Who]

Keep to good quality blue chip stocks that pays good dividend. Lower risks profile with good income.

VCT, FBU, AIA... etc

[h2so4]

That is an open question. I guess it comes down to what type of investor you are? Conventionalist, non conventionalist, safety seeker. Retirement will still leave you with decades of investing to do. :)

[Dubdee]

None fixed interest only unles you ahve a big portfolio

[peat]

yes the conventional approach is that as you get older the less risk should be taken with ones investments , with a transfer from risky shares to bonds and cash
but if we are just talking from a equity perspective there should be an increasing focus on reliable return dividend producing blue-chips and the avoidance of speculative growth oriented shares (obviously growth is good but it is generally associated with risk)
But of course it depends on the overall situation as to how that would pan out in practice.

[OldRider]

The size of the retirement fund makes a difference as well, I keep just sufficient in interest bearing deposits and bonds, to provide,together with gvt super enough to pay all the household outgoings,
house and vehicle maintenance and holidays included.

The balance is in a spread of stocks, sold all real estate-too much hassle, with funds put into Listed property companies. Funds divided btetween NZX ASX and British Investent companies
As one ages time seems to get more precious, and that wasted on the boring process of managing investments better used in other ways, so I am
slowly shifting into LIC's and enjoying the free time!

[ratkin]

Its a little late to be buying shares imo . Three years a very short time frame

[Dubdee]

In my portfolio I have fixed interest, cash, some boutique Unit trusts, direct shares and direct property.

The fixed interest is my core. I have calculated with some accuracy my annual cost of living (which is after tax of course) and multiplied this by 17 times to set my fixed interest portfolio size. I constantly maintain that level. This ensures I always have enought to eat. No debt

The rest of my portfolio is divided betweeen cash and risk assets, generally preffering capital growth over income. Profit from that I use for toys and travel.

I rarely venture outside Australasia due to strong correlation between NZ$ and overseas risk markets

[shasta]

Keep to good quality blue chip stocks that pays good dividend. Lower risks profile with good income.

VCT, FBU, AIA... etc

Add in the likes of RYM, IFT, WFD, EBO, ABA, CEN, MET, SKC

Weighted towards the healthcare sector, with some energy & a bit of gambling

All worthy of further research

[Footsie]

The % of cash in your overall investment portfolio. excluding your own home, should equal your age..... eg 65 yr old , should have 65% on term deposit at the bank.
invest the remaining 35% as you wish.
but dont buy a stock just for its dividend. its got to be a good company too. otherwise the div will just get cut , eg TEL

[trackers]

The % of cash in your overall investment portfolio. excluding your own home, should equal your age..... eg 65 yr old , should have 65% on term deposit at the bank.
invest the remaining 45% as you wish.
but dont buy a stock just for its dividend. its got to be a good company too. otherwise the div will just get cut , eg TEL

110% Footsie? I wish!

[CJ]

Its a little late to be buying shares imo . Three years a very short time frameCash for 1-2 years expenses.
fixed interest for 3-5.
income stocks for 5-10 years expenses
growth stocks for 10+ years.

Just because you are retiring in 3 years, doesn't mean all you money comes out in 3 years. Continually adjust your portfolio to ensure you have enough cash and fixed interest. The above is an example but you get the point.

[voltage]

I would certainly aim for dividend stocks that grow their dividends. These are usually large blue chip companies as mentioned above. Focus on NZ where you access imputation credits. Aussie banks are worth looking at and maybe some large global companies like Johnson and Johnson.

[Alex the not so great]

I would certainly aim for dividend stocks that grow their dividends. These are usually large blue chip companies as mentioned above. Focus on NZ where you access imputation credits. Aussie banks are worth looking at and maybe some large global companies like Johnson and Johnson.

I totally agree , and it will be my strategy once I've retired.

However, since I still have 3-5 years to go and I am already paying lots of PAYE, I am really hesitate to own those shares now.

Any suggestions?

[Alex the not so great]

In my portfolio I have fixed interest, cash, some boutique Unit trusts, direct shares and direct property.

The fixed interest is my core. I have calculated with some accuracy my annual cost of living (which is after tax of course) and multiplied this by 17 times to set my fixed interest portfolio size. I constantly maintain that level. This ensures I always have enought to eat. No debt

The rest of my portfolio is divided betweeen cash and risk assets, generally preffering capital growth over income. Profit from that I use for toys and travel.

I rarely venture outside Australasia due to strong correlation between NZ$ and overseas risk markets

Brilliant! I really like the idea: fixed interest for basic living and riskier portfolio for luxuries.

[Dr_Who]

Add in the likes of RYM, IFT, WFD, EBO, ABA, CEN, MET, SKC

Weighted towards the healthcare sector, with some energy & a bit of gambling

All worthy of further research

Agree. Some good stocks in your list.

Also put some in bonds. I still have some ANZ, BNZ bonds that gives over 8-9% yield over a long term maturity. Make sure they are secured bonds with quality large institutions and not finance or risky co.

Alex, if you wanna take on high risk stocks, make sure it is only a small percentage of your portfolio.

[Alex the not so great]

The size of the retirement fund makes a difference as well, I keep just sufficient in interest bearing deposits and bonds, to provide,together with gvt super enough to pay all the household outgoings,
house and vehicle maintenance and holidays included.

The balance is in a spread of stocks, sold all real estate-too much hassle, with funds put into Listed property companies. Funds divided btetween NZX ASX and British Investent companies
As one ages time seems to get more precious, and that wasted on the boring process of managing investments better used in other ways, so I am
slowly shifting into LIC's and enjoying the free time!

I should definitely do that as well!

[Alex the not so great]

Its a little late to be buying shares imo . Three years a very short time frame

I guess I still have decades to manage my portfolio even after retirement. :-)

[Alex the not so great]

Agree. Some good stocks in your list.

Also put some in bonds. I still have some ANZ, BNZ bonds that gives over 8-9% yield over a long term maturity. Make sure they are secured bonds with quality large institutions and not finance or risky co.

Alex, if you wanna take on high risk stocks, make sure it is only a small percentage of your portfolio.

Thanks a lot, Dr. Who! I actually have tried to find some bonds to buy myself, but at the moment the yield is round 6%. Therefore, I'd like to buy shares now while they are cheap and maybe sell them after 24-36 month when economy is at its peak. I hope I may get a much higher yield from bonds after I've sold the shares.

By doing this, I hope I may have a higher return when I am still working but maintain a high percentage of fixed interest after the retirement.

[Alex the not so great]

Keep to good quality blue chip stocks that pays good dividend. Lower risks profile with good income.

VCT, FBU, AIA... etc

How about banks? WPC, ANZ?

[bull....]

Why not consult a financial planner are they not the experts in this field

[Phaedrus]

I think that your emphasis should be on capital gains until you retire and dividend income after your retirement. To be setting up a retirement portfolio 5 years before you need the income doesn't make much sense to me.

[macduffy]

Brilliant! I really like the idea: fixed interest for basic living and riskier portfolio for luxuries.

Not just for luxuries.

If you plan on a long retirement - don't we all! - you'll need the equity part of your portfolio to provide the growth to offset the inevitable inflation over 20, 30 years or whatever.

I wouldn't attempt to prescribe an income/growth mix. So much depends on personal circumstances, size of fund, appetite for risk etc. Rules of thumb can't cover all this but the general idea is to reduce risk over time, particularly if one's capacity to manage the portfolio diminishes.

[CJ]

I am already paying lots of PAYE, I am really hesitate to own those shares now.some of the property funds are PIE's so are capped at the top company tax rate. Higher yield should be ata reasonably low base at the moment.

Alternatively invest via a company.

[h2so4]

I think that your emphasis should be on capital gains until you retire and dividend income after your retirement. To be setting up a retirement portfolio 5 years before you need the income doesn't make much sense to me.

Tend to agree, if you still can sock away savings, you can afford investments in growth shares.

[Stumpynuts]

Tend to agree, if you still can sock away savings, you can afford investments in growth shares.

Speaking of growth shares..... A few possible long-term growth stocks ?!?!? - SPY, HGD, possibly GEN

SmartPay this week announced that they acquired 2Degrees as a client along with a few other big names such as Mitre10 and PaperPlus, and they seem to be building quite a monopoly share of their market with their range of Retail services.
Heritage Gold has Gold apparently, and a JV begging to be announced and mining to start one day.
Genesis Research - If only purely for the speculation that May Wang and associates announced interest in GEN researching into dairying.

Thoughts?!?!?

[Lizard]

Speaking of growth shares..... A few possible long-term growth stocks ?!?!? - SPY, HGD, possibly GEN

Thoughts?!?!?

I hope you are joking. I can hardly think of less suitable prospects for building retirement funds, bar pouring the money into lotto tickets.

SPY is about to face major hurdles in re-financing the looming wall of debt that is coming up for renewal in August to September. Even if they can do this successfully, the business is likely to need more working capital for expansion. In the current market, this looks like a recipe for dilution.

HGD is purely speculative until they have something more than a possible JV in the pipeline and a potential gold resource.

GEN seems to have survived the last 5 years or so purely by selling off technologies as soon as they were well enough developed to be worth the value of a year or two's salaries. Even this strategy is failing them of late and they've had to resort to another placement.

I think you need to reconsider your use of the term "growth shares". These picks are probably better classed as "speculative shares". A "growth" company is usually one which is profitable and which has a good return on equity (say >15%) that can allow it to fund expansion without having to put a hand out for new funds.

[Shrewd Crude]

def CUE energy...
Organic growth for sure...

Matariki
Artemis
Caterina
Barikewa

at least one will hit something big...
schkamollar...
:cool:
.^sc

[Stumpynuts]

I hope you are joking. I can hardly think of less suitable prospects for building retirement funds, bar pouring the money into lotto tickets.


Ahahahahaha, yes I am partially kidding.... actually.

It's all a big joke, just like TEL, and the NZX stock markets in general.
Those TV ads with Paul Reynolds....... Taking Pot-shots at your own company....

Actually, serious long term stocks - RBD, AIA, and a few of the property trust stocks which give good divies

[krusty]

In my portfolio I have fixed interest, cash, some boutique Unit trusts, direct shares and direct property.

The fixed interest is my core. I have calculated with some accuracy my annual cost of living (which is after tax of course) and multiplied this by 17 times to set my fixed interest portfolio size. I constantly maintain that level. This ensures I always have enought to eat. No debt

The rest of my portfolio is divided betweeen cash and risk assets, generally preffering capital growth over income. Profit from that I use for toys and travel.

I rarely venture outside Australasia due to strong correlation between NZ$ and overseas risk markets

I dont understand the multiply by 17 times. Is that some magic number or the years until your preceived expiry?

[Enumerate]

I dont understand the multiply by 17 times. Is that some magic number or the years until your preceived expiry?

It means that he expects his fixed interest portfolio to earn 5.9% pa to generate the level of cash he wishes to spend.

[krusty]

It means that he expects his fixed interest portfolio to earn 5.9% pa to generate the level of cash he wishes to spend.

Sorry, bit slow here. Think you might need to baby talk me thru this one. Just pretend I am a french perfum heiress, and you want my private island in the Seychelles.

[Enumerate]

Think you might need to baby talk me thru this one.


Magic Number = 17

Amount_To_Live_On_$ x 17 = Capital_Needed_$

=> Amount_To_Live_On_$ = Capital_Needed_$ x 1/17 = Capital_Needed_$ x 0.059 = Capital_Needed_$ x 5.9%

This can be corrected by a number of factors. The Telecom factor triples the required capital needed. The Eric Watson / Mark Hotchin factor means you will be lucky to get half your capital back, so just forgest about any income.

:0)

[CJ]

I think it means he is living of interest (the 5.9% referred to) keeping the interest bearing component intact.

I personally would have more growth which I would slowly sell down as a spent the interest bearing component.