Kiwis have high levels of financial risk

Food for thought:
• Each year in 54,800 Kiwi households, the main earner’s income is lost through long term illness, and over 50% lose it for six months or more1
• Debt is at a record high: the household debt-to-income ratio has increased dramatically, up from 46 percent in 1988 to 168 per cent in 2017; many Kiwis are vulnerable to rising interest rates or a change in their financial circumstances2
• Thirty-eight percent of Kiwis don’t have a Will, and approximately 1,500 pass away each year without one3
• Some uninsured Kiwi drivers who were in a road-accident as far back as the 1990s, were still paying back the debt as recently as last year4
Just a few (of the many) reasons why the Money Week 2018 message of ‘financial resilience’ is spot-on, says Katrina Shanks, CEO of Financial Advice New Zealand.

Ask Google if New Zealanders are searching ‘financial resilience’ and the answer is no: of course, it’s a fairly new term and yet to make its way into the money-mindset of Kiwis.

But conversely, type in pay day loans or payday advance, and Google paints a different picture, with 2,400 and 1,900 searches each month respectively. And that’s just for starters.

“Debt levels are high; the cost of living is high; savings are low and so are the number of Kiwis covered by insurance, or with a plan in place for their financial future or the ‘what-ifs’ of life,” says Katrina.

“Money Week’s message is crucial to the financial life, and lives, of Kiwis. We want to see ‘financial resilience’ become a Kiwi household term; a term that will support awareness of the big and small things that people can do to build their financial well-being and to protect against life’s unpredictable turns.”

“Too few Kiwis seek financial advice, which can help keep them afloat when life events impact on their well-being,” says Katrina.

1 Mind the Gap Income Protection Forum, Financial Services Council of New Zealand: November 2015
2 Financial Stability Report, Reserve Bank of New Zealand: May 2018
3 Perpetual Guardian: The Future of New Zealand's Estate Planning: September 2017
4 AA Insurance: March 2017

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