Welcome to the Money Maven's Financial Blog

Money Maven Blog by Sheryl Sutherland, Authorised Financial Adviser and Director of The Financial Strategies Group

Recommended Reading

Recommended Reading by Sheryl Sutherland: Girls Just Want to Have Fund$ - Every Women’s Guide to Financial Independence, Money, Money, Money Ain't it Funny - How to Wire your Brain for Wealth, and Smart Money - How to structure your New Zealand business or investments and pay less tax.

The Financial Strategies Group

We think for ourselves and make unique recommendations. We only recommend investments and insurances that are in the best interest of our clients.

The Financial Strategies Group

Most of us spend 40 years working to secure our financial future; the most important investment you can make is to purchase appropriate financial planning advice.

Contact us for a review of your investments and insurances.

Begin to experience the serenity that accompanies financial responsibility and integrity: email sheryl@strategies.co.nz, call 0800 64MONEY or visit our website http://www.strategies.co.nz

Wednesday, 29 July 2009

Who's Counting

We like odds of 50 per cent more than probabilities of 25 per cent or 75 per cent. This is why we buy lotto tickets.

What are the odds of dying in a plane crash compared to dying on the roads? Twice as many people die on the roads during a year than the total of those who have died in air accidents. Yet we fear flying more than driving. Air fatalities evoke shock but road deaths are simply another standard news item. We are drawn to the most astonishing event regardless of its probability.

Consider the following odds:
• Being killed by terrorists while travelling: 1 in 650,000.
• Royal flush opening hand: 1 in 649,739.
• Winning anything on a Lotto Lucky Dip: 1 in 20.
• Winning Lotto Division One on a Lucky Dip: 1 in 373,838.
• Winning on one Lotto ticket bought weekly for 50 years: 1 in150.
• That you’ll keep buying and not win the jackpot after 50 years: 149 in 150 (99.33 per cent).
• Winning Powerball Division One on a Power Dip: 1 in 3,070,704.
• Winning on one Power Dip ticket purchased weekly for 50 years: 1 in 1,250 (99.92 per cent don’t win in all that time).
• Being hit by lightning during your life: 1 in 7500.
• Getting cancer sometime in your life: 1 in 9.
• Suffering an unprovoked shark attack: 1 in 6,000,000.
• Drowning in your bathtub: 1 in 685,000.
• Dying in a car crash in New Zealand: 1 in 9000.
• Dying from slipping, stumbling or tripping: 1 in 6548.
• Dying from fireworks discharge: 1 in 615,488.

Obviously the chances of winning lotto are not high, but people still persist in buying tickets.

Everyday Money

A paper presented at the Australian Social policy conference at the University of NSW found that divorce had a substantial impact on women’s incomes and almost none on men’s. But, it appears that men are not happy! Could it be that they are used to having someone doing the cooking, cleaning and organising their social life? Or could it be that they don’t want to pay child support?

The study found that divorced men’s average income after they had paid child support was A$33,356; while women’s incomes after child support was paid to them averaged A$26,512. Tellingly, the fathers reported feeling more prosperous when married...Perhaps the answer for men would be to keep the children...? Organise their own lives...?


Why is it still acceptable to subordinate women to men? Well, the religions of the world respond, because religious tenets tell us so.

In Northern Nigeria a pregnant 13 year old girl, Bariya, received 180 lashes of the cane after being pimped by her father. The State’s Attorney General who, one presumes, has a smattering of education, said “It is the law of Allah”. In Jerusalem “modesty police” terrorise women who talk to men or show ordinary parts of their body. In some parts of India women are still expected to commit suicide on their husband’s death or go to an ashram.

The Qur’an says “If you fear highhandedness from your wives, remind them (of the teachings of God), then ignore them when you go to bed, then hit them.”
Muhammad actually married a prepubescent child and upon being given two slave girls, gave the ugly one to a friend and kept the beautiful one, Maryam to use sexually (this is according to the Hadith, the sayings and traditions of the Prophet).
And worshippers at a Church of England cathedral are being offered a two track communion service with a separate supply of “untainted” communion bread for those who object to its being consecrated by a woman priest.
In Malaysia a Muslim model is being whipped for drinking beer. Her conviction caused a furore in the country where Muslims are rarely punished for consuming it.

We routinely read of women being imprisoned in their homes, having their genitalia cut, being stoned for having sex or being expelled from their family to fend for themselves in a culture which precludes female emancipation.

This level of bigotry of women deserves at least as much attention as global warming, but appears to be well and truly under the radar as far as the world is concerned.

Musings and Amusings

The Tao of Pooh suggests that ideas float around the universe and pop into the nearest head on a random basis – the latest findings in neuroscience validates this theory.

It appears that our brains operate on the edge of chaos. Most of the time our brains operate in an orderly fashion, according to the New Scientist article, “Disorderly Genius: How chaos drives the brain, but every now and then lurches into a blizzard of noise.” The technical term for systems on the edge of chaos is “self organised criticality”. A growing sand pile demonstrates this perfectly. Imagine sand pouring from a large container into a pile – it grows uniformly and predictably until it hits a critical point and collapses forming a new temporarily stable state.

The brain has much in common with this behaviour. Networks of brain cells alternate between periods of calm and periods of instability. It might seem a bit precarious to have a brain that plunges into periods of instability but the article suggests that this disorder is actually essential to the brains ability to transmit information and solve problems.

So the next time you feel confused, muddled and disordered you could simply be an avalanche away from your next best idea!

Finance and Investments

So what is the key to financial success? To make wise decisions you must have the right information, and combine and weigh its various components correctly. You must not ignore valid information in favour of thinking and judgemental tendencies that are dangerous in the investment world; for example, weighting the most vivid and recent information more strongly than heeding the lessons of history. Investors must develop a mindset that helps them understand and adapt to the financial environment. Money is an emotional currency that relates to our individual need for security, power, respect, love, esteem and self-determination. If you don’t know who you are, the investment world can be the most expensive place to learn. The psychic conflict between the temptation of profit and fear of loss makes investing a dangerous game for many people.

To change our financial behaviour we must learn new skills, moulding the knowledge of behavioural finance and neuroscience. Investors must focus on imperatives such as motivation, knowledge and understanding, wisdom and discipline – the focus is not on how to pick shares, get rich in the property market or get rich quick – the focus is on the psychology of investor success.


There have been many articles and even some discussion at the Economic Summit in Davos, over whether the financial meltdown would have been so severe, or would have occurred, if Lehman Brothers had been Lehman Sisters. It’s certainly pretty clear that business culture is overwhelmingly male and fuelled by testosterone.

In Iceland, officially a bankrupt country, women are cleaning up the mess. Iceland with a population of just over 300,000, has had the Krona collapse, interest rates and inflation have soared, companies and households which have borrowed in foreign currency are overwhelmed by debt, and unemployment is at record levels, reports the Guardian. Over the last decade Iceland had adopted a new economic order reinventing itself as an Atlantic Tiger, enthusiastically adopting free market reforms and financial engineering. The crisis led to the government’s downfall, the new government is led by an elegant 66 year old lesbian Johanna Sigurdardottir.

And it is women now who are heading up banks and companies. Prominent among the forty-something women is the singer Bjork who, with two other women, has set up an investment fund to boost the economy by investing in green technology. They state they have five core feminine values:
1. Risk awareness, they don’t invest in things they don’t understand.
2. Profit with principles, that is not just economic profit, but a positive social and environmental impact.
3. Emotional capital, they do an emotional due diligence.
4. Straight talking, the language of finance should be accessible not jargon infested.
5. Independence, they want to see women become financially independent which gives women the greatest freedom to be who they are.

Exactly the values we adhere to at Women’s Financial Strategies.