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

Thursday, 1 November 2012


The 4 Life Stages of Women Investors

In Relationships, where the emphasis is on enabling advisors to effectively engage with both partners in a marriage or domestic union.

In Transition, in which the focus is on providing support to women investors during a time of significant life change, such as a career transition, divorce or death of a spouse.

In Business, which identifies strategies for advising professional women, including women who are business owners or have inherited significant assets.

In Retirement, where the emphasis is on enabling the advisor to work closely with women investors in developing financial strategies that support the goals of living longer and better. The number of widows and female divorcees is on the rise.

Source: Financial-Planning.com

Finance & Investments

Thanks to my favourite economist Mr Brent Wheeler for sharing this:

If this looks complex just examine NZ. Twenty years ago we were ranked at number 19 of the top 20 safest bond investment haven and now we have clawed up to number 13. Japan, number one 20 years ago didn’t make the top 20 this time round. At number one, currently, is Norway, which, you will be interested to know, has a 40 percent requirement for women on boards.


Bias Persists for Women of Science, a Study Finds

Science professors at American universities widely regard female undergraduates as less competent than male students with the same accomplishments and skills, a new study by researchers at Yale concluded.
As a result, the report found, the professors were less likely to offer the women mentoring or a job. And even if they were willing to offer a job, the salary was lower.

Female professors were just as biased against women students as their male colleagues, and biology professors just as biased as physics professors — even though more than half of biology majors are women, whereas men far outnumber women in physics.

Surely we should be past this – I frequently read of men who say there is no glass ceiling – and even some women!

Source: NY Times

Musings & Amusings

For decades, women have battled for equality, but what if equality was not the end point? What if we are heading for a future of female dominance?

So runs the thesis of what promises to be one of the year’s most sparred-over books. In The End of Men, the American journalist Hanna Rosin says that males have ruled the roost “since, well, the dawn of mankind.” Now, she argues, the balance of power is shifting “with shocking speed.” From one perspective, the decline of the male is his own stubborn fault, a result of his bewildering failure – or refusal – to adapt to a shifting global economy. Men, says Rosin, have become casualties of the end of the manufacturing era. They used to hold macho labour-intensive jobs. In the post-industrial world, where “thinking and communicating have come to eclipse physical strength and stamina as the keys to economic success,” they are floundering.

“The attributes that are most valuable today – social intelligence, open communication, the ability to sit still and focus – are, at the minimum, not predominantly male,” she says.

As Sheryl Sandberg, the chief operating officer of Facebook, put it last year: “A hundred and ninety heads of state; nine are women.”

Economists Justin Wolfers and Betsey Stevenson have shown that women are less happy today than they were in 1972, both in absolute terms and relative to men.

Even the author is concerned about the ramifications of change. “A lot of women in America are now going it alone,” she said.

“They are not finding men who are suitable marriage partners, so they are raising children, working,  carrying the whole burden in ways that are exhausting.”

Source: Sunday Star Times

Everyday Money

Top 5 Worrying Results
·         73 percent of people are concerned how their kids will ever afford a house.
·         22 percent said “Nothing I do will make a difference to my financial situation” rising to 33 percent for those aged 50-64 years.
·         19 percent aged 18-39 believe that “KiwiSaver means I do not have to save for my retirement.”
·         38 percent feel dealing with money is stressful, rising to 43 per cent for those aged 50-64.
·         Only 46 per cent know what interest they are getting on their savings.

Top 5 Cheerful results
·         65 percent are aware of their net wealth, rising to 73 per cent for those aged 50-64.
·         75 percent aged 40-49 per cent would like to help their kids financially.
·         57 percent knew the balance of their transaction balance at all times. 67 percent knew how much they had in their savings accounts.
·         53 percent tried to stay informed about money and financial matters at all times.
·         29 percent were actively saving to build their “emergency fund.”

Source: Sunday Star Times

Who's Counting?

Companions ain’t cheap; but still cheaper than children!
$100 start-up cost, $20 annual expenses, $300 lifetime cost over 10 years. Buy a goldfish. Plonk it in a bowl. Feed it. Goldfish are low cost and low maintenance – the perfect entry-level pet.

$150 start-up cost, $150 annual expenses, $1650 lifetime cost over 10 years.

$250 start-up cost, $466 annual expenses, $7,250 lifetime cost over 15 years. The average cat costs $466 a year, according to a report published last year by the Companion Animal Council (CAC).

$700 start-up cost. $1047 annual expenses, $13,250 lifetime cost over 12 years. Canine companions are roughly twice as expensive as cats. There’s the added cost of registration, which can be as much as $130 a year, or more if the breed is classified as dangerous.

$6,000 start-up cost, $3,000 annual expenses, $80,000 lifetime cost over 25 years. Surprisingly, the CAC report put the cost of a horse or pony lower than a dog, at $895 a year.

Source: The Press

Monday, 16 July 2012

Everyday Money

Struggling to organise joint finances? Try the following:

Source: Girls Just Want to Have Fund$ by Sheryl Sutherland

Musings and Amusings

Evolution has given humans a huge advantage over most other animals: middle age – who would have thought?

We are used to dismissing our fifth and sixth decades as a negative chapter in our lives, perhaps even a cause for crisis. But recent scientific findings have shown just how important middle age is for every one of us, and how crucial it has been to the success of our species. Middle age is not just about wrinkles and worry. It is not about getting old. It is an ancient, pivotal episode in the human life span, pre-programmed into us by natural selection, an exceptional characteristic of an exceptional species.

Compared with other animals, humans have a very unusual pattern to our lives. We take a very long time to grow up, we are long-lived, and most of us stop reproducing halfway through our life span. A few other species have some elements of this pattern, but only humans have distorted the course of their lives in such a dramatic way. Most of that distortion is caused by the evolution of middle age, which adds two decades that most other animals simply do not get.

An important clue that middle age isn’t just the start of a downward spiral is that it does not bear the hallmarks of general, passive decline.

Excellent news for those who were worrying about the impending doom and gloom of old age.

 Source: The Washington Post

Who's counting?

Most New Zealander's would not survive longer than three months in the face of a personal financial disaster, according to new research. 

Visa's 2012 International Financial Literacy Barometer surveyed more than 25,000 people across 28 countries. 

New Zealand was ranked the sixth most financially literate country, behind world leaders Brazil, Mexico and Australia. 

Our savings rate was well behind the Chinese, about half of whom have built up enough of a cash buffer to survive for six months. 

However we came out ahead of Pakistan, where just 13-14 per cent of respondents were able to endure a three-month financial calamity. 

One of the key findings of the survey was that earning a high income did not necessarily translate to good financial health. 

For example in Canada, Russia and Serbia high-income earners were less prepared to weather a crisis than their peers getting by on lower incomes. 
The survey also found that New Zealanders were pretty good at following a household budget, scoring 45.8 out of 100, and at talking to their kids about money (44.9). 

But our lack of faith in young people's ability to understand money management basics put us near the bottom of the table for that category, in 21st place. 

The survey found that the youngest and oldest individuals tended to be most at risk, with those aged 35-49 in the best financial position.
Source: Richard Meadows, Fairfax News


 Following the lead of countries like Spain, France, Italy, and Belgium, the European Union is considering legislating quotas for women directors on boards.

Quotas are a drastic step, especially in Europe, where men overwhelmingly run companies, and boards of directors are also almost entirely male. Just 13.7% of large-company directors and 3.2% of presidents and chairmen within the EU were women as of January, the New York Times reported in March. That’s after a program designed to boost women’s selection for boards, instituted last year, garnered little support from companies.

Viviane Reding, vice president of the European Commission, has been pushing for EU-wide quotas. She noted in a March press release that in 2010, the EU’s largest public companies had women represented on boards just 12% of the time. She is also urging companies to sign a “Women on the Board Pledge for Europe,” which commits them to have a board made up of 30% women in 2015 and 40% in 2020.

“It confirms what I always believe about change: that it goes from the ‘unthinkable’ (quotas are unthinkable) to the ‘impossible’ (not in our country) to the ‘inevitable’ (the sky does not fall and actually quotas turn out to be a good thing),” Liswood said in an email to The Wall Street Journal.

On the other hand, there are a lot of people – including women – who are firmly opposed to enforcing gender quotas on corporate boards or don’t think quotas will get the job done.

I am solidly behind this initiative.

Source: Wall Street Journal

Finance & Investments

Over the years, the phrase "emerging market" has become all but meaningless. No group that includes China, Argentina, Kenya, the Philippines, and Romania can possibly qualify as a single coherent class. 

To pick the likeliest winners in this vast category, Jim O'Neill of Goldman Sachs has given us the BRICS (Brazil, Russia, India, China, and now South Africa), the "Next 11" (Bangladesh, Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, the Philippines, Turkey, South Korea, and Vietnam) and, more recently, MIST (Mexico, Indonesia, South Korea, and Turkey). Robert Ward of the Economist Intelligence Unit has added the CIVETS (Colombia, Indonesia, Vietnam, Egypt, Turkey, and South Africa.) 

But all these constructions include a dizzyingly diverse set of economies that don't have much in common.

We live in a crisis-prone age.

The countries that are best positioned to prosper are those that are resilient as well as strong. That's why pivot states, those able to build profitable relationships with multiple partners without becoming overly reliant on any of them, are the likeliest winners in the G-Zero era. 

Brazil will continue to enjoy excellent trade ties with the United States. But China is now its largest trade partner, helping Brazil's economy ride out the U.S. slowdown with minimal damage. NATO membership gives Turkey lasting influence in Brussels and Washington, and many in the Arab world look to Turkey as a dynamic, modern Muslim state. Add its position at the crossroads of Europe, Central Asia, the Middle East, and the former Soviet Union, and Turkey has a range of political and commercial options. As in Brazil, this advantage helps absorb the sorts of shocks that are now all too commonplace. 

Asia is home to several pivot states. Indonesia, with nearly 240 million people, enjoys a well-diversified economy with trade ties balanced among China, the United States, Japan, and Singapore. Vietnam receives most of its aid from Japan, its arms from Russia, and its tourists from China; its biggest export market is the United States.

Not all pivot states are developing countries. Far-sighted policy ensures that Canada is now less vulnerable to a slowdown in the United States. The percentage of Canada's exports to countries other than the U.S. jumped from 18% in 2005 to more than 25% just four years later.
The likeliest losers in this more volatile world are shadow states, the opposite of pivots, those whose political and commercial possibilities are determined almost entirely by a single powerful partner. Mexico's largest sources of foreign currency are oil sales, tourism, and remittances from nationals working abroad. In all three cases, the vast majority of that currency comes from the United States.

Mexico's domestic- and foreign-policy choices are determined by its political process, not the demands of a domineering sponsor. But when compared with Canada, Mexico's commercial opportunities and the speed of its development are largely defined by conditions inside one foreign country.

Ukraine, another shadow state, wants to escape Russia's gravitational pull and become a pivot state, preserving relations with Moscow while building new ties with Europe. In fact, Kyiv wants to ink a free-trade deal with the European Union. But Russia has threatened to sharply increase the price of natural gas shipments to Ukraine and throw up new trade barriers if Kyiv moves forward with Europe. The EU, for its part, will end trade talks with Ukraine if it joins a customs union with Russia. Ukraine can't win because it can't pivot. It lacks the strength and independence to improve its bargaining position with either side.

Source: Harvard Business Review


Why have I bothered dieting? Latest study in the NY Times tells me that the low fat carbohydrate-rich diet will not keep me thin (wondered what was wrong!). In fact the study debunks the old calorie in calorie out myth telling us that the fewer carbohydrates we eat the more easily we remain lean. The more carbohydrates, the more difficult. In other words carbohydrates are fattening. What matters, then, is the quantity and quality of carbohydrates we consume.

From this perspective the trial suggests that among the bad decisions we can make to maintain our weight is exactly what the government and medical organisations have been telling us to do: eat low fat, carbohydrate-rich diets, even if those diets include whole grains, fruits and vegetables.

Wednesday, 18 April 2012


Why does the average New-Zealander see their home as a nest egg for retirement. This is fantasy. As a financial planner what I see is when the family home is sold, and a retirement home purchased, the pull of new furniture, whiteware, car and overseas travel is irresistible. In many cases not only has the "nest egg" vanished but funds earmarked for retirement income are utilised. What to do? No matter what your age and stage get yourself to a financial planner.

Who's Counting?

Joan Rivers said "People say that money is not the key to happiness, but I always figured if you have enough money you can have a key made." If you don't have enough money to have the key made try this:

Go through your expenditure for the last month or so and figure out those items which engender feelings of happiness - for example does the coffee and muffin you buy everyday make you happy or is it a habit? If it is a habit you can save $10 a day to spend on something you love.

Finance & Investments

A recent Forbes article by Mindy Crary identified the four stages of awareness we need to master before learning a new skill.

Unconsciously Incompetent. This is the stage where you don’t know what you don’t know. This skill or thing isn’t even on your radar. Many people are unconsciously incompetent with wealth creation because while growing up, it wasn’t an issue for them. Things got bought and paid for and no one ever talked about money.  

Consciously Incompetent. You know you want to be able to do something. This is where people start to apply their individual problem solving styles; some people jump in anyway, some people try to intellectually and theoretically understand before applying the new knowledge. People usually become aware that they are consciously incompetent with wealth creation right after they make a money mistake, like accumulate credit card debt.

Consciously Competent. When you’re consciously competent, you know how to perform the required skill, but you have to do it carefully. With wealth creation, you might limit your options with investing because you KNOW you don’t understand the more complicated investment products; or you manage your debt, but only because your credit cards are in your freezer, submerged in a tin car filled with water (because you can’t microwave a tin can).

Unconsciously Competent. Unconsciously competent people perform the skill without even really thinking about it. When people are unconsciously competent about wealth creation, it usually looks like they just got lucky—often the way people perceive other successful people. The specific reasons for their competency vary between individuals; but one thing that DOESN’T vary is an early awareness about money and an environment that supported the idea that people do in fact have complete control over their financial situation.

In my day job as a financial planner I deal with people in all these categories, mostly in the "unconsciously incompetent" and "consciously competent" stages. Its my job to move them through to "unconsciously competent."

Musings and Amusings

A fascinating new study out of Australia knocked the stereotype of selfish, single, Sex & The City-style women on its head this week with findings that it’s not career ambition that’s keeping young women from settling down, but rather a long list of reasons outside of her control. First and foremost, a lack of a willing, able—and kid-friendly—partner.

Housing ranked highly, too, with women wanting to reduce a mortgage, to renovate or to move to more suitable accommodation before having a child.

For centuries women have married without giving a thought to love, searching instead for financial security, stability and a father for their children simply because they were ready to have children.

The modern women is looking to build her life so she can make a decision when the time is right financially, pragmatically and emotionally—so she doesn’t need to find the man to make it happen, but the man she can enjoy life with while everything else falls in line.


Worldwide women are crucial to economic growth. It's not a topic which is widely discussed but a recent McKinsey report on the US economy makes for interesting reading.

Click here for graph

Since women’s participation in the workforce took off, in the 1970s, their productivity has accounted for about a quarter of current GDP. But women still aren’t reaching their full economic potential. One important reason is that far too many highly skilled women simply don’t progress up the ladder in corporate America.

A new report, delves into the details of this well-known phenomenon. The problem isn’t simply a lack of flexible working conditions or support for working mothers. Nor is it an inability to get women into the workforce or women’s desire to opt out; most can’t afford to. Instead, entrenched mind-sets and behaviors—at companies and among women themselves—are two of the biggest culprits in preventing women from advancing. The issue is particularly acute at the transition from middle manager to senior manager, a point when women have proven themselves professionally yet a disproportionate share leave corporate careers. For many, invisible biases become impassable.

One striking discovery is that women who have progressed from entry-level jobs to middle management, and then from middle management to senior management, have, at each stage, an increasing interest in being leaders and an increasing belief that opportunities exist.

Helping middle-management women to develop and advance will make the biggest difference because it will begin to reshape the corporate talent pipeline and help companies reach their goal of advancing more women to the top.

Everyday Money

I really dislike the term budgeting - it implies a restrictive regime - somewhat like dieting and ends up being something else we fail at and can feel guilty about.

Current psychobabble talks about living consciously; I am advocating spending consciously. I have written before about the "black hole," the area where we can't identify our spending. Get a torch and peer into your black hole - are you buying takeaways too frequently - say $50 a week? Cut back to $25 - you can still enjoy the treat, have the experience but reduce the expenditure.

Secondly assess after a month or so whether you are satisfied with your $25 a week.

Then tackle your next challenge, can you for example reduce your petrol consumption, walk to some places, enjoy the outdoors and save some money.

Finally continue to spend consciously - make it a habit!

Friday, 27 January 2012

Who's counting?

Interesting that the two energy sources New Zealand is not using are the cheapest. Political correctness perhaps?


Why are we being forced to use electricity? Is it too hard to attack sectors such as manufacturing, transportation, agriculture and deforestation? This is of particular interest to Christchurch residents who are being forced to use electricity as the main source of heating.

Finance and Investments

Women in developed economies have made substantial gains in the workplace during recent decades. Nevertheless, it’s still true that the higher up in a company you look, the lower the percentage of women.

Research in Europe and the United States suggests, for example, that companies with several senior-level women tend to perform better financially. Hiring and retaining women at all levels also enlarges a company’s pool of talent at a time when shortages are appearing throughout industries.

Many countries and regions face talent shortages at all levels, and those gaps will worsen. By 2040, Europe will have a shortfall of 24 million workers aged 15 to 65; raising the proportion of women in the workplace to that of men would cut the gap to 3 million. In the United States, the upcoming retirement of the baby boomers will probably mean that companies are going to lose large numbers of senior-level employees in a short period of time; nearly one-fifth of the working-age population (16 and older) of the United States will be at least 65 by 2016.

In recent years, McKinsey has done extensive work on the relationship between organisational and financial performance and on the number of women who are managers at the companies they have studied. The research has shown, first, that the companies around the world with the highest scores on nine important dimensions of organisation—from leadership and direction to accountability and motivation—are likely to have higher operating margins than their lower-ranked counterparts do. Secondly, among the companies for which information on the gender of senior managers was available, those with three or more women on their senior-management teams scored higher on all nine organisational criteria than did companies with no senior-level women.

Work by professors at the business schools of Columbia University and the University of Maryland lends support to this point. demonstrate the “strong positive association between Tobin’s Q, return on assets, and return on equity on the one hand and the [female top-management] participation rate on the other.”

It’s exasperating to see these studies and be aware of the pool of talented women who are not being advanced in their careers either as senior management or directors.

Why are we still stuck in this rut? Changing companies minds about women.

Despite significant corporate commitment to the advancement of women’s careers, progress appears to have stalled. The percentage of women on boards and senior-executive teams remains stuck at around 15 percent in many countries, and just 3 percent of Fortune 500 CEOs are women.

The last generation of workplace innovations—policies to support women with young children, networks to help women navigate their careers, formal sponsorship programs to ensure professional development—broke down structural barriers holding women back. The next frontier is toppling invisible barriers: mind-sets widely held by managers, men and women alike, that are rarely acknowledged but block the way.

When senior leaders commit themselves to gender diversity, they really mean it—but in the heat of the moment, deeply entrenched beliefs cause old forms of behaviour to resurface. A survey McKinsey conducted earlier this year indicated that although a majority of women who make it to senior roles have a real desire to lead, few think they have meaningful support to do so, and even fewer think they’re in line to move up.

Do women lack ambition? Not on your life.

Women want to succeed, yet even when they do “all the right things” Catalyst has found that they earn less and progress more slowly than men. The fact that some women adjust their career advancement strategies after crashing into institutional barriers is a rational response to inhospitable workplaces. It is not an example of a lack of ambition.

Women aspired to be CEO in equal proportions as men. But the women—to a much greater extent than men—ran up against barriers, namely exclusion from informal networks, stereotyping, and a lack of role models. Our report found that women and men have similar work values. The problem is this: men find workplaces more aligned with their values, women don’t.

The latest Catalyst report examined the career advancement strategies of thousands of MBA graduates from top schools around the world and the impact of these strategies on their careers. Women and men were equally represented in the two most proactive groups, indicating that ambition ran high among both genders. But being proactive paid off more in promotions and pay for the men.

In Pipeline’s Broken Promise, Catalyst found that among MBA grads who aspired to be CEO or senior executives, women progressed more slowly than men. And parenthood, industry, and previous experience didn’t explain the gender gap. The leadership and pay gaps balloon over time, suggesting that the problem lies with the system, not the women.

The misguided assumption that women are less ambitious than men puts companies at risk of inadvertently underutilising talented women and overlooking, or outright dismissing them, for key roles. This is a real loss for companies. Organisations need to step up and clear a path for women’s success.

Women are ambitious. But systemic barriers in the workplace mean that ambition, even when coupled with talent, isn’t always enough.

How to get to the other side of the debt chasm

Paying off debt doesn’t require a secret formula: 48% of people who’ve done it said they simply stopped spending on their cards, 28% stuck to a budget, and 15% took a side job.

Living debt-free – what is it like
You’ll live a fuller life. A full 60% of people surveyed felt that being in debt prevented them from really enjoying life. Picture what you’d put your energy into when your debts were paid.

You’ll save money. Using 30% or less of your total available credit.
You’ll feel better. Some 62% of people said debt added unwanted emotional stress.
Your first step: Get debt coaching.