DIY or adviser? Making the right choice in NZ

Making the decision to start planning for retirement is a pivotal life moment, and in New Zealand there are numerous investment options to secure your later years. The question remains: should you manage your investments personally or collaborate with a financial adviser? In this guide, we'll explore the pros and cons of both options to help you make an informed choice tailored to your retirement aspirations.

Seeking professional guidance:

Pros:

• ‍Expertise: Financial advisers bring extensive knowledge and experience to the table. They can work with you to understand and set achievable retirement goals. This includes providing tailored investment strategies that align with your goals, risk tolerance, and time horizon.
• ‍Objective advice: Advisers offer an objective perspective on your investments, helping you avoid impulsive decisions driven by emotions. They can keep your financial plan on track, even during market fluctuations.
• ‍Time-saving: Partnering with an adviser allows you to offload the time-consuming aspects of investing, giving you more freedom to focus on life.
  
  

A survey by the Financial Services Council of New Zealand revealed that 40% of seniors wished they'd sought more financial counsel in their earlier years. Enlisting professional advice can prevent such regrets.

Cons:

• ‍Cost: Advisers come at a price, be it through fees or commissions.
•  Loss of control: Some individuals might be hesitant relying on another's research, even that of an experienced professional.
• ‍Choosing the right fit: It can be a challenge to find an adviser who truly understands your financial goals and aligns with your investment philosophy.
  
  

The DIY approach:

Pros:

• ‍Autonomy and control: Managing your own investments means complete decision-making authority, allowing you to cater to your individual financial preferences.
• Cost efficiency: Without adviser fees, there's potential for higher net returns, particularly if you have a solid grasp of financial markets.
• Immediate access: With a DIY approach, you can swiftly execute your investment decisions without the need for intermediaries., enabling quick reactions to market changes.
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Cons:

• ‍Lack of expertise: DIY investing requires substantial knowledge and experience. Novice investors may face a steep learning curve and potentially make costly mistakes without professional guidance.
• ‍Emotional challenges: Managing investments independently can be emotionally taxing. Correctly reacting to market volatility and making objective decisions during turbulent times can be challenging without an experienced adviser's influence.
• ‍Time-consuming: Successful DIY investing demands significant time and effort. Research, analysis, and ongoing portfolio monitoring can be demanding, potentially affecting your work-life balance.

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Although the DIY approach to retirement planning allows individuals to maintain autonomy, offering direct control overinvestment decisions, it also demands significant time and expertise. Many find that the complexities of the financial market can be navigated more confidently and efficiently with the guidance of an experienced adviser.

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Conclusion:

The decision to go DIY or enlist a financial adviser in New Zealand ultimately depends on your individual circumstances, financial acumen, and retirement vision. As you contemplate this choice, consider your risk tolerance, time availability, and willingness to dive into the intricacies of investing.

For those who are willing to accept the risks and relish learning about financial markets and are willing to invest substantial time in research and analysis, the DIY approach can be both fulfilling and cost-effective. However, it's essential to remain mindful of the potential pitfalls and emotional challenges that may arise along the way.

Conversely, seeking professional guidance can provide peace of mind, particularly for those who value expert insights, objectivity, and a diversified investment portfolio.

Ultimately, whether you decide to go DIY or partner with a financial adviser, it's crucial to align your investment strategy with your retirement goals, investing horizon, risk appetite and aspirations. Making informed decisions, staying disciplined, and regularly reviewing your financial plan will be key to a successful retirement.

Reach out to us today or request a free consultation to explore how NZBritannia can help you build a tailored plan to achieve your retirement goals.

The information contained in this article is intended for general guidance and information only. It has not been personally prepared for you. Therefore, you should not act on this information if you have not considered the appropriateness of this information to your personal objectives, financial situation and needs. You should consult with us before making any investment decision. Historical market performance may not be indicative of future market performance.