Demystifying investment: how to make your money work for you

Whether it’s saving for a first home, your retirement or for a rainy day, investing wisely can help get you there - and we’re here to help you unpack it all.

The passive income that investments can provide can help us steer our own financial future, achieve our goals and have more security.

You don’t have to be a pro - or have millions - to get going. Small, consistent investments can create strong returns in the long run.

Learning about the types of investments

Types of investments can include real estate, retirement funds like KiwiSaver, shares, bonds - and more.

Common investments you may want to find out more about are managed funds, exchange-traded funds (ETFs) and index funds.

Managed Funds

Managed funds (like those we offer here at Mercer), can provide you with the convenience factor and a hands-off approach to investing. Professional fund managers make decisions on behalf of investors, these professionals actively monitor and adjust the fund's holdings to seek the best returns. This allows investors to benefit from professional expertise and resources without the need for the DIY approach. Regulatory oversight makes sure everything is transparent and protects investors, giving them peace of mind.

Exchange-Traded Funds (ETFs) and Index Funds: An Overview

Index funds and ETFs are both investment vehicles that aim to track the performance of a specific index such as the S&P 500, though an ETF may sometimes be actively managed. An ETF is an investment fund that is traded on stock exchanges, similar to individual stocks. Both offer diversification, liquidity, and transparency, making them a popular choice for investors looking for a simple and efficient way to gain exposure to a wide range of assets.

Some great resources (other than the Table!) include:

Unleashing the power of compound interest

Compound interest is one of investing’s major superpowers that can turn small, regular investments into substantial savings over time. Working away in the background, compound interest quietly grows your money over time. This happens as a result of your returns being reinvested, allowing them to increase even more as time goes by. The earlier you start, the more powerful this force becomes.

The amount of compound interest you will earn depends on various factors, including your salary, contribution rates, and the specific investment you choose. While everyone receives the same interest rate, the dollar amount of interest earned will vary based on individual circumstances. By starting, you can watch the magic happen!

The earlier you start, the more it will pay off in the long run. No matter where you’re at in your life stage, even small contributions can help you reap the benefits of compound interest in the long term. Read more about compound interest here.

It’s also a common misconception that you need a fortune to start investing to begin with. You don’t! You can start small. The most important thing is to be consistent. By putting away just a little bit of money each week, your financial wellbeing will be on point down the track.

Think it’s too risky? It’s understandable - there will always be a certain level of risk involved. However, by seeking financial advice, researching the options and choosing the right diverse investments for your personal situation, you can mitigate much of this risk.

Boosting your confidence and getting financially lit

Investing is not exclusive to men or financial gurus - it's for everyone. That includes you.

Women belong in the investment world, without question.

Talk to the women in your life and see how they approach their financial wellbeing. Trade tips, ask questions, and get into the nitty gritty of it all. There’s no shame in talking about money - we all need it and deserve it, and collectively, we have so much wisdom to share. Read articles here at the Table.

Take the opportunity of investing to empower yourself and shape your own future. The time to start is now.

You can contact a Mercer financial adviser here to talk all things KiwiSaver. We also recommend you speak to one of the team before or straight after you switch your KiwiSaver investment to Mercer.

The above article is general information and does not purport to give financial advice. The Mercer KiwiSaver scheme and Mercer FlexiSaver are issued by Mercer (N.Z.) Limited. Product Disclosure Statements are available free of charge at