sharetrader
Page 1 of 6 12345 ... LastLast
Results 1 to 10 of 57
  1. #1
    Junior Member
    Join Date
    Jun 2019
    Posts
    2

    Default Investment strategies for newborn

    Hi guys

    New to the forum and just wanted to get a bit of advise.
    We have an 8 month old and I wanted to get her saving early so she could start investing. My wife and I opened her an account under her name and started putting $25 per week aside.
    She now has $800 in her account and we were thinking of making her first investment through smart shares.
    Investing the minimum $500 then $50 per month into the same fund maybe FNZ.NZX?. Letting the other $50 per month build up to $500 then investing that.

    My wife and I are new to investing but with the small portfolio we have in the stock market we have been very impressed with the results.

    As our daughters investments will be over a long period 20+ years before it will be touched I would love if any thoughts or other ideas on investing for her future.

    Thanks

  2. #2
    Dilettante
    Join Date
    Mar 2010
    Location
    Down & out
    Posts
    5,406

    Default

    Your daughter will be very thankful for you one day if you do this. With the situation and plan you describe, I think it would be very hard to beat regular investments into the S&P500 through Smartshares https://smartshares.co.nz/, Sharesies https://www.sharesies.nz/ or Hatch https://www.hatchinvest.nz/

  3. #3
    Member
    Join Date
    Jun 2016
    Posts
    87

    Default

    I would go for sharesies. You can invest as little as $5 with no start up fee. You could get huge diversification for her. They do have fees but is it only .75 cents a month for kids. I do it for my daugther.

  4. #4
    Member
    Join Date
    Aug 2015
    Posts
    284

    Default

    ETF tracker....or trackers....can't predict the future and there will be at least 20 yrs before she needs anything. Countries and economies can move drastically, companies can become obsolete, so for that timeframe a regular into three or four ETFs that reflect asset class AND has a global reach. If it were 5 to 10 years, the approach could be a tad more predictable.

  5. #5
    Member
    Join Date
    Dec 2016
    Posts
    85

    Default

    We do this one for our 7 month old daughter.

    Good place for grandparents etc to put gifts too.

    https://www.superlife.co.nz/invest-for-children

  6. #6
    Member
    Join Date
    Jan 2005
    Location
    New Zealand
    Posts
    101

    Default Congratulations!

    Congratulations @Jamesw, both on the arrival of your daughter and taking some proactive steps towards giving her a great head start.

    Cooperative Bank Youth accounts are I think currently the best available (did require me becoming a member with a zero balance savings acc.) which earn 3% interest on the first $4000 deposited, and 0.75% on anything over $4000. I think it's the best child account around at the moment and it may suit your needs, at least initially. (Youth account is zero fees for anything and is up to the age of 12!)

    If you go down the shares route I'd advise against buying in your child's name (e.g. getting them a CSN etc) as it'll just cause grief later if you want to sell quickly, or at all. Nothing in NZ seems well setup for children as the admin is always done under the guise of the guardian's account. A good example is Westpac online term deposit setup, works... but defaults to guardian's tax rate, requiring a phone call and several days to fix.

    You didn't mention it, so apologies if you know this already, but the government's BestStart plan is a must have, everyone gets it for the first year and then there's an eligibility requirement after that; https://www.ird.govt.nz/topics/worki...out-best-start

  7. #7
    Guru justakiwi's Avatar
    Join Date
    Aug 2016
    Location
    Canterbury
    Posts
    2,569

    Default

    Can’t see any details of fund options/fees etc for this. Seems you have to sign up in order to see any of that info.

    Quote Originally Posted by epower View Post
    We do this one for our 7 month old daughter.

    Good place for grandparents etc to put gifts too.

    https://www.superlife.co.nz/invest-for-children

  8. #8
    Senior Member
    Join Date
    Nov 2018
    Location
    Christchurch
    Posts
    1,063

    Default

    In my opinion, with the narrow scope of investment choices for newborns in NZ (compared to places like Canada and abroad), I would not bother. The amounts are too small.

    You would be far better to take those funds and use it to invest it into your OWN investments. When the time comes your child is old enough, you can 'gift' part of the proceeds. As in previous posts, the issue of compliance, paperwork, regulation, just doesn't warrant to have another separate dedicated account; especially when the amounts are quite small.

    I am biased because the Canadian model for allowing newborns and the young / teens is immense. Such as RDSP and TFSA - all have a focus of TAX FREE compounding. Even relatives and friends can make the gifted contributions for which in some registered plans, the gov't matches the amount to the account holder. Gosh.. there's a LOT of things Jacinda Ardern could learn about how Canada is addressing how people get into their 1st home, tax laws that encourage the poor / low income to invest. Of course we are in NZ so all this is moot interest but would be glad to see something done more in NZ in this area.

  9. #9
    Guru
    Join Date
    Sep 2009
    Posts
    2,685

    Default

    By signing them up for Aggressive Kiwisaver when they turn 17 and contributing $1100/year to age 65 then they will have
    At age 65, they could have: $200,517.00
    From 65 until age 90, this would give them: $250.00 per week

    Worth considering IMHO

    Try sorted website,see attached

    https://sorted.org.nz/tools/kiwisave...ngs-calculator
    Last edited by kiora; 16-02-2020 at 10:16 AM.

  10. #10
    Senior Member
    Join Date
    Nov 2018
    Location
    Christchurch
    Posts
    1,063

    Default

    Quote Originally Posted by kiora View Post
    By signing them up for Aggressive Kiwisaver when they turn 17 and contributing $1100/year to age 65 then they will have
    At age 65, they could have: $200,517.00
    From 65 until age 90, this would give them: $250.00 per week

    Worth considering IMHO

    Try sorted website,see attached

    https://sorted.org.nz/tools/kiwisave...ngs-calculator
    It's a load of rubbish because they're based on 'static' assumptions. That's not how the finance works in the real world as you have years that are positive and years that are negative. You also have to factor inflation (which the NZ gov't doesn't have a gasp of 'indexing' payments to a CPI figure every year). Then you have to factor administration costs and taxation ; a key issue that is not spelled out well by various Kiwi Saver funds.

    What is $250/week going to buy in 47 years time?

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •