Investor Journeys—Ruth Henderson

Ruth lives in Alexandra with her husband Jonny and ten-year-old daughter. She’s the brains behind The Happy Saver, a blog and podcast where she talks about managing your money to live the life you want. Last week, we caught up with Ruth about investing for kids, and this week, we’re going to hear a bit more about her own investing journey.

Tell us about your first investment!

Aside from our first house in Christchurch, our first investments were term deposits and Bonus Bonds. Then, we started investing in managed funds with a financial advisor. As time went on and I learnt more, I began to question what the financial advisors were doing. I wanted to control our own money, and not hand off that responsibility to someone else. So over time, that’s what I did. The further I have gone with my investing, the more simple it has become—and it goes without saying that discovering index funds has been a complete game changer.

Since then, I’ve had a play with other forms of investment too, which is fun! Gold, Bitcoin, managed funds, a Land Rover(!), Bonus Bonds, term deposits...I learn from everything I get involved in, and I enjoy the process.

What would you do differently, if anything?

Growing up, I never heard the word “investing” mentioned, so it just wasn’t something I was aware of. It wasn’t until my income reached a point that was more than I could spend that I started thinking about putting some money elsewhere. 

The truth is that I earned money since my 20s, and even if it was a tiny amount, I could’ve set a little bit aside from each pay—I just never knew to do it. In a perfect world, I would’ve bought into a low-cost index fund on a monthly basis and never stopped!

What do you like about having an investment?

I love the security of having money invested in something other than property. We own one home, the one we live in, and that is more than enough for me. I want to diversify, and investing in other areas lets me balance out my portfolio and risk.

Having investments has also given us the freedom to do what we need to do as a family, without being constrained by money. After the Christchurch earthquakes, our house was locked up with our insurer and we couldn’t touch any of that equity, even though we owned it outright. Having money invested elsewhere meant we could pack up and leave Christchurch, quit work, and get out. When my father developed Alzheimer's and my mother started living with cancer, having money invested allowed me to stop working to help and support them.

Investing can give you security by helping you plan for an unexpected event. Over many years of growing an investment, you are simply growing your freedom—and you can be as involved or as hands-off as you want to be!

People often think you need loads of money to invest. What would you say to everyday New Zealanders who might not think it’s possible?

You don’t need loads of money to invest, and your investing strategy need only be simple! Whether you have $10 or $200 left at the end of the week, any amount that you put away will double and triple over the years to come. To me, investing is a slow and steady journey where I put small amounts of money aside. And every bit helps—collectively, it equates to about 35% of our income.

I received an email recently where a guy had been putting $50 a month into an index fund and had more or less forgotten about it. He rediscovered it, worked out that he had put $7,000 into it over 10 years, and found the value today was $14,000. Not bad for a set and forget investment!

What is the best piece of advice you’ve given about investing?

My biggest tip would be to just START. Set up a direct debit into a bank account or a fund that you like the look of. Start with $5, make it easy, and make it doable. After a couple of months, increase it to $10. Reassess down the track, and up it again if you can spare the coin. 

Markets have blips—they go up, they go down, but over time, they always go up. And if you start young, you have that time. I guarantee you won’t miss the money, but you will get a pleasant surprise when you check on your investment one day and realise that your money is working for you!