As more young New Zealanders begin their investment journeys, experts urge caution, diversification, and education over hype and high-risk bets. Here’s how first-time investors can build wealth the smart way.
Young Kiwis Embrace Investing with Caution and Curiosity
New data from the Te Ara Ahunga Ora Retirement Commission’s Financial Sentiment Tracker reveals that a growing number of young New Zealanders are taking their first steps into the world of investing. According to the research conducted by TRA, 15% of people aged 18 to 24 have at least $1,000 alongside existing investments. This figure climbs to 24% among those aged 25 to 34.
The statistics show that young investors are beginning to see beyond savings accounts and are exploring more dynamic options to build long-term wealth. But as experts warn, the journey should start with fundamentals rather than fast thrills.
Start Small, Think Big: Building Habits with KiwiSaver
KiwiSaver remains the most recommended starting point. “You’re still in the habit-forming stage of life and the habit you learn [from KiwiSaver] is regular savings,” said Sam Stubbs of Simplicity. While contributions may seem modest, the compounding impact of employer contributions and government incentives makes KiwiSaver an essential foundation for new investors.
The advice is simple: build a savings routine before branching out into more volatile markets.
Explore the Markets, but Stay Grounded
Once KiwiSaver is in place, financial experts encourage first-time investors to dip their toes into shares and funds. Starting with as little as $5 or $10 a week is enough to gain experience. Westpac’s Warren Ngan Woo suggests investing in companies whose products or services you already use, making the learning process relatable and grounded.
Engagement is key. Reading business news, following market trends, and participating in investment communities like Sharesies’ Share Club help new investors understand how markets operate.
FOMO Isn’t a Strategy — It’s a Warning Sign
The fear of missing out, often stoked by viral headlines or online forums, is one of the biggest pitfalls for beginners. Experts caution against chasing trends without understanding what you’re buying.
Even when venturing into trendy assets like crypto or meme stocks, restraint is vital. “Use coffee money or beer money,” advised Katrina Shanks of ANZIF. The golden rule: never invest what you can’t afford to lose.
Diversify, Don’t Gamble
First-time investors are also urged to avoid putting all their funds into a single asset. Whether it’s one cryptocurrency or one stock, the risk of total loss is high. Spreading investments across sectors and asset types—such as equities, fixed income, and digital assets—offers better protection.
“Don’t confuse investing with gambling. One is a strategy; the other is luck,” the report notes.
Use Tech, Learn Early, Fail Cheap
Platforms like Sharesies, Hatch, and EasyCrypto have made investing accessible. However, they can also lead to emotional decision-making. “Even $100 can be meaningful,” said financial adviser Mark Patton of Stuart Carlyon. A small loss today could be a valuable lesson for tomorrow.
With Sorted Money Month underway throughout August, it’s an opportune time for young people to educate themselves and build sound financial habits.
For New Zealand’s emerging investors, the path to wealth isn’t paved with hype—but with patience, discipline, and a well-diversified portfolio.
