It’s been impossible to avoid the daily headlines in the media recently about the impact that the global pandemic, the war in Ukraine and raising inflation is all having on market stability and KiwiSaver investments.
These are certainly bumpy times, and as a result, the market “wobbles” (as we’ve been calling them) may be a bit unnerving if you’re planning to use your KiwiSaver savings as a deposit to buy your first home in the next six months or so.
Whilst it may seem like it’s currently just one thing after the other, and making changes might give you a sense of control over your KiwiSaver investment, the key to remember is to NOT panic or take any drastic measures or make extreme changes.
Take a deep breath and keep in mind that the nature of the market is cyclic – it always has ups and downs over time!
When it comes to investing, the best thing you can do is make sure your investments still match your goals. That way you'll be well set to ride out any market wobbles that come along.
The best place to start is to ask yourself if your KiwiSaver fund matches your financial goals. What are you saving for and what is your timeframe?
Generally, if you’re thinking about purchasing a new home in the near future and withdrawing your funds in the next 6-12 months, you might feel more comfortable in a conservative fund with less exposure to the share market and the volatility currently being experienced. This might give you more certainty while you look for your first home, and keep your current KiwiSaver balance on an even keel.
If you have longer-term plans or are not planning to withdraw your KiwiSaver savings for a couple of years, then a leaning into a growth-oriented fund could be a better option as these funds help to grow your balance more over time. As the saying goes, “It’s time in the market, not timing the market” that really counts.
In either case, if you’re concerned about the market wobbles and thinking of using your KiwiSaver savings in the near future, give us a call on 0800 336 338 or call your financial adviser to have a chat through some options that are best suited to your needs.