23 November 2022

    Create a bright future for your kids

    Help them prepare for life's milestones

    Children can bring you a lot of joy. With their endless energy, and vast capacity for giggles and fun, they can make you feel like a kid again yourself.

    Every parent wants the best for their kids, and as a parent you know just how expensive life can be. As they grow, your children might need money for university, a first car, overseas travel, marriage, or a first home. At those milestones, extra help from you can make a huge difference. Especially as the cost of living keeps going up.

    Make your money a gift that keeps on giving

    So what are your options when it comes to saving for your kids’ future? Your first thought could be to open a savings account, or a term deposit, but there are other ways to save, which, if you start early can really help you harness the benefit of compounding returns over the long term.

    • Savings account: This is a straightforward option, but the money may lose value over time if inflation is higher than the account’s interest rate. Other options can help your money work harder.

    • Term deposits: These can be okay if you have a lump sum and know when you want to withdraw the money. But they don’t work well if you want to drip-feed cash in or take it out early for something you didn’t anticipate. And while term deposits are a low-risk option, you may not earn much more interest than in a savings account.

    • KiwiSaver: This is a good long-term option if you only want your children to access the money for a first home or at retirement. It won’t work as an education fund, or for any other purpose, and they won’t be eligible for the annual government contribution of $521.43 until they turn 18.

    • Managed funds: Like KiwiSaver, managed funds invest in a range of different assets like shares, fixed interest and property, but they’re much more flexible. You can choose when to access your money. You can select from a wide range of funds depending on when the money’s needed. For example, you could consider a higher-growth but higher-risk fund if it’s not needed for a decade or longer. Or lower-growth but lower-risk funds if the money’s needed soon. The good news is, if goals change, you can change your strategy.

    You can set up a managed fund account for your child in your own name or you can set up an account in their name that you can contribute to. If you set up an account in your child’s name, when they turn 18, they will be able to access their funds.

    Leave the hard work to the experts

    KiwiSaver and managed funds can help you protect and grow your wealth for future generations. Fund managers put in all the effort, so you don’t need to pick shares or study the market.

    At Fisher Funds, our investment team actively manage your investment so you can focus on what matters to you most. We use in-depth research processes, looking at who’s in management, what sets them apart from their competition, and of course, we assess their likelihood of growing and staying profitable.

    Discuss your options with us

    If you let time work its magic, even a little can go a long way.

    Talk to us to decide what best suits your goals for your children.