Lauren Croft is a young professional from Wellington. In between hiking up mountains and volunteering, she’s made becoming a property and share market investor possible in her twenties. Lauren shared her story with us, and her tips for young New Zealanders wanting to do the same.
Can you tell us about your first investment?
I started investing because I was curious about options for my savings, and the opportunities this could present me for my future. I watched how my dad retired early due to having investments, which encouraged and inspired me to give it a go. When I started looking at more opportunities for my future, the thought of buying a house really kicked my savings and investing into gear.
My first investment was after university. I made my first savings from working full-time and looking into options that weren’t leaving my money idle in my bank account. No one in my immediate circle was talking about investing, so it was my older sister who referred me to one of her investment platforms, having invested for years herself. I put money away and paid no attention to it apart from the minimum monthly investment requirements. This was somewhat of a good method of investing, but I also had no understanding of where my money was going or what sort of gains I was making.
This initial investment broke the ice for me and gave me the confidence to take more control of my money and invest again somewhere else. About a year ago, I invested with Sharesies for the first time. At first, it was daunting having to decide where to invest—but it was super easy and rewarding. I’ve learned more about investing in the last year with Sharesies, than I have in the three years of investing anywhere else. Since becoming a share market investor with Sharesies and other investment platforms, I’ve bought a house too! A dream I had held for many years came to fruition much faster than I had initially imagined.
How did you feel after becoming a property and share market investor for the first time?
It’s a feeling that’s hard to describe. In both cases, it’s one where you feel empowered and excited for your future! There is a flip side where you also have to remind yourself that while the money flies out of your account for your mortgage and your investments every payday, you’re looking after your future self. Even if current you wants to #treatyourself. Which you still can do…you might just need to scale it back a little bit.
Since beginning to invest, my attitude has completely changed. I still have my original investments, but I’m now much more open and transparent about my investing. I am also getting much more pleasure ‘playing’ with my money. My friends and I even text each other market updates, and have some healthy banter around who is buying shares and where! I treat my Sharesies account like pocket money. When I have some leftover money in my account, no matter how small, it goes into my Sharesies Wallet. It’s amazing watching my money (that is normally wasted on coffee and snacks) grow into a good wee nest egg.
What do you like about having investments? Why should more young people try it?
I like the sense of security and independence in investing. The money is out of my everyday account, so instead of having it there to easily spend, it’s away somewhere working hard for me and my future. I also enjoy the conversations that have come out of investing, and the change I can see in my friends who have started. Sharesies has made investing incredibly accessible and easy for my friends and I because of the low buy-in amount. We’re all looking out for ourselves, creating financial independence—it’s exciting! I’m even thinking about getting my nieces and nephews involved!
What would you do differently, if anything?
Definitely flip my mindset. If you always tell yourself that you’re bad with money, you will be. I would have asked more questions and gotten started earlier. When I started, I didn’t feel comfortable talking to my peers about investing. I worried about all the money that had “disappeared” from my account over the years at university.
Nowadays, I have a completely changed investment strategy and am really enjoying the process. I feel now, with my Sharesies, KiwiSaver and other investments, I have a much greater handle and understanding of how my money is working for me.
People often think that you have to choose between buying a house or buying shares. What tips would you give to everyday New Zealanders who might not think investing in both property and shares is possible?
I have to say, I was one of those people for a long time. This attitude changed when I started investing and realised it could help me “get on the ladder” by having my savings work for me while I built up to a house deposit. Bumping up my KiwiSaver contributions to 8% and contributing to my investments on a regular basis helped with this.
When I bought my house, I chose not to use all my invested money. I wanted to keep my ‘pocket money’ investing going, sort of like an experiment, but also to see how it would grow with time and little effort. This also meant that if I did need money for something unforeseen, I still had a few eggs in my basket. One thing I’ve always learned is “you need a diverse Portfolio”. Investing in property and shares works in different ways. I didn’t want all my money invested in property, so I actively chose to keep my investments elsewhere to make sure I was keeping that diversification.
What is the best piece of advice you’ve given (or been given) about investing?
There’s never one, so here are my top three tips:
Start small, keep it regular, and don’t touch it—I can’t recall who told me this first, but it’s one that has stuck.
Flip your mindset—If you think investing is scary and impossible, that is how investing will be for you. If you keep telling yourself that you’re bad with money, you are more likely to talk yourself out of good money decisions.
Talk about it—The best way to learn something new is to remove the stigma and talk about it. Money isn’t something you need an expert to be able to understand. It’s refreshing how many people want to talk about it when you just ask, or start the conversation.