Putting some of your savings into the capital markets through investments funds (or managed funds as they are also called) can help spread your risk and bolster your returns.
They can now access a broad range of high quality, diversified investment funds that have a range of risk and return profiles suited to their investment horizon.
These funds are like KiwiSaver funds, and are often managed by the same providers.
They pool your money with other investors to allow you to invest in diversified portfolios of shares, bonds, property, infrastructure and cash, across local and international markets.
They are transparent, robustly regulated, managed by experts and liquid.
For some providers, you can invest initial and ongoing amounts as little as $1.
Unlike KiwiSaver, investment funds are “unlocked”, which means in most cases you can access your money within about a week.
Like any investment, you should look around and seek advice either from the provider or by talking to an independent Financial Adviser.
People should read the product disclosure statement and any other information from the provider - understand who’s involved, what fees and tax you’ll need to be paid, where and how money will be invested and what the risks are.
Kiwis are now able to access capital markets in a transparent, cost-effective way to help them save for whatever it is that matters to them.
Investing in an investment fund is a way for people to let the capital markets do some of the heavy lifting to achieve their financial goals.
Stewart Taylor is Acting Managing Director, Funds Management, for ANZ NZ.
This information is general in nature and is not to be construed as advice. Investors should seek professional advice. To the extent permitted by law, ANZ does not accept any responsibility or liability arising from your use of this information. Investment performance is not guaranteed and may be negative or positive.
This article first appeared on stuff.co.nz