Financial  Advice from Dr Pushpa Wood

When it comes to money it's best to get your own independent advice.

Overseas figures suggest that 20 per cent of over 65 year olds have been taken advantage of with excessive fees, inappropriate investments or downright fraud.

Massey University’s Director of Financial Education and Research Centre, Dr Pushpa Wood says, “when it comes to money it's best to get your own independent advice.”

"If you are thinking of going to a financial advisor have a phone conversation before making an appointment. The first thing you should do is ask a couple of questions to find out if you are getting independent advice.

  • Are you working for yourself or are you on a salary or commission?
  • Are you tied to any particular product ?
  • What fee do you charge?

“A financial advisor will discuss with you when you want to access your money and give you a range of option – bonds, shares and term deposits.

“It’s also important to make investment decisions based on the life stage you are at. Your age will determine how much risk you are willing to take  Are you 67, 77 or 87?. Find out if the products are high or low risk. Investment products that carry risk often make the most money but as you get older it’s important to reduce risk and have a safety net.”

“If you have a problem with your financial advisor, sit down and discuss with them why you aren’t happy.  If you feel you didn’t get the right service or advice you can go to a number of dispute resolution schemes for help.”

Disputes resolution services

Lending money to family

Researchers from the Victoria University Institute of Policy Studies and Age Concern who interviewed victims found many abusers simply do not recognise that older people are entitled to control their own money.

Children or grandchildren also believe they're entitled to an early inheritance and fail to repay loans.

Dr Pushpa Wood

Money brings out the best in people but it also brings out the worst. Taking advantage of someone’s kindness can be a form of financial abuse. I’ve seen families fall out over small amounts of money and know of older people who have even lost their homes,” says Dr Pushpa Wood, Director of Financial Education at Massey University.

“It’s hard not to feel obliged to help members of your family financially when you receive a lump sum payment on retirement.”

However Dr Wood says “when you retire, you may still have 30 years or more ahead of you. It’s important to carefully plan how you want to use those savings. If you lend money to a family member it may not come back to you when you need it. For example you may suddenly need money for surgery or house repairs.

“Dealing with family pressure may be difficult but the first step is talking to someone you trust. There are organisations like Age Concern and Citizens Advice who can provide help.”

For information on retirement planning and how much money you will need go to  Sorted.org.nz 

If you are thinking about lending money to family members you should seek  legal advice on your options. Some firms provide discounts to SuperGold Card holders.