The easy investing strategy you didn’t know about
Of course, this doesn’t mean you forget about your investment entirely! It’s still useful to check in now and then. But setting-and-forgetting with auto-invest is a great way to stay on track in between check-ins and reach your financial goals. Here’s why:
Invest regularly, without the guesswork
With over 8,000 investments on Sharesies, you might not know what you want to invest in. To give investors another option, we worked with external experts to make three pre-made orders—a Responsible, Global, and Kids order. The orders are designed to spread your investment across a range of NZ managed funds or exchange-traded funds (ETFs), so that you can build a portfolio that’s diversified across different industries and countries with minimal effort.
Auto-invest also makes investing regularly easy. All you need to do is set up an auto-invest order through Sharesies, then set up an automatic payment through your online banking. This automates the entire process—from topping up money from your bank account, to making an investment in Sharesies. Everything runs in the background, making it super easy to build up an investment portfolio.
We talk about this principle a lot: by investing the same amount on a regular basis, regardless of what the share price is, you can average out the ups and downs of the share market (rather than catching the market at a specific high or low point). You might buy shares at a higher price one week, and at a lower price other times, but these can even each other out over time.
This saves you the trouble of trying to time the market—which even the best investment professionals struggle to do! By automating your investments, you can avoid the stress of wondering if you’re getting a good deal or not. Just decide what order you want to invest in (and how often), choose an amount, and forget about it. It gives you all the benefits of dollar-cost averaging, without needing nerves of steel.
You can’t miss what you don’t have
If you pay PAYE income tax, you probably have a good idea of what you get paid each week, month, or fortnight. But you might have a less clear idea of how much you’re paying in taxes, ACC levies, student loan payments, and KiwiSaver contributions each pay cycle. That’s because you never really see these payments going out of your account. You pay them before your money reaches your bank account so it doesn’t “feel” like you’re paying them, even though they go out like clockwork!
The same principle applies to investing. If the AP for your auto-invest order is set to go out the minute you get paid, you won’t notice it’s gone. This makes it easier to work towards your investing goals because you’re regularly contributing to your investments without thinking twice about it.
Build up over time
Your investment goal may be big, small, or somewhere in between. But no matter how large it is, you can get there slowly and steadily by auto-investing. If you set an auto-invest for $20 a week, you’d have invested over $2,000 in 2 years—and possibly more if you get compound returns along the way.
This is a great way to achieve your investment goals without affecting your day-to-day spending too much. Just choose a goal, set a time horizon, then automatically invest a portion of that every week, fortnight, or month. It’s up to you!
Now that you know the benefits of a “set-and-forget” approach, it’s time to put your knowledge to work! Log in to Sharesies, choose what you want to regularly auto-invest in, and set up an AP from your bank to keep your Wallet topped up. Then forget about it for a while! But be sure to check in every now and then—it’s about forgetting for now, not forgetting forever.
Ok, now for the legal bit
Investing involves risk. You aren’t guaranteed to make money, and you might lose the money you start with. We don’t provide personalised advice or recommendations. Any information we provide is general only and current at the time written. You should consider seeking independent legal, financial, taxation or other advice when considering whether an investment is appropriate for your objectives, financial situation or needs.