In business, there is a very important principle when it comes to management and governance of financial matters – the principle of conflict of interest. A conflict of interest arises when the concerns or aims of two different parties are incompatible, or when a person is in a position to derive personal benefit from actions or decisions made in an official capacity. It is no different in families, particularly when f...

Physicists know that for every action there is a re-action and it’s the same with money. With every financial decision you make (or don’t make) there is a consequence. Consequences may not, however, be instantaneous. They make take years to unravel. Where we end up in life is the sum of the consequences of every financial decision made. People who don’t consider the consequences of their financial decisions jeopar...

Life is short, and for some people, it ends much sooner than expected. In fact, according to some psychologists, the older you are, the more you tend to perceive time as moving faster. A leading proponent of this theory is Claudia Hammond, a psychologist and BBC columnist. Apparently, this all has to do with how quickly your brain processes information. When you are young, your brain processes information at lightning spee...

Every year the Financial Markets Authority (FMA) surveys the public to measure their level of confidence in New Zealand’s financial markets. The role of the FMA is to promote fair, efficient and transparent financial markets and surveying the public is one of the ways in which they find out how well they doing in this regard. In the latest survey, around 66% of those surveyed said they were confident in New Zealand’s f...

Being able to borrow enough money for a first home is the biggest financial hurdle for young couples. When lenders consider how much they can lend they consider two key aspects. The first is how much money the couple have as a deposit and the second is the amount of borrowing the couple can afford to repay out of their income. Any couple looking to buy a home needs to consider how to get in the best possible shape with reg...

Following a lengthy and comprehensive review of the law relating to trusts undertaken by the Law Commission, and the introduction of the Trusts Bill to Parliament in 2017, we now have the Trusts Act 2019 which will come into force on 30 January, 2021. There are important changes for trusts, which should be noted by all trustees and beneficiaries of family trusts. There will now be five mandatory duties for trustees. The...

The process of aging is no fun. It is, however, inevitable. As we age, brain processes slow down and it becomes difficult to deal with complex information and change. We all react to this process in different ways. Some people just go with the flow and deal with the effects of aging as they arise. Others dig their toes in, trying to fight off the inevitable. Yet another group plan for what lies ahead and restructure their ...

Everybody has their own unique relationship with money. Some people are good savers while others find it hard to stop spending. Some people are keen to take risks with their money in order to get a better return while others prefer to keep their money safe. Let’s be clear – there is no right or wrong when it comes to a person’s relationship with money. There are just differences. These differences stem from many fact...

Low interest rates and share market volatility are driving investors to consider alternative investments. In recent years we have seen the rapid rise of property syndicates. Such syndicates were very popular over twenty years ago and were offered by companies such as St Laurence and Waltus. At that time, they had a chequered reputation, with some syndicates performing well and some dismally. A property syndicate is crea...

For investors who depend on interest rates for income or investment, the future looks bleak. Interest rates are at the lowest level we have seen for decades and are likely to stay low for some time. Prior to the Global Financial Crisis of 2008, many fixed interest investors chased after the double-digit returns offered by finance companies, only to discover that high returns reflect high risk. The huge losses following the...