A Simple Graph that explains… where to invest your money

The No. 1 personal finance question being asked online is “I have $XXX in saving, where should I put it?” or “What should I do with my term deposit?”. People who are unfamiliar with personal finance usually have no idea where to investment their money except term deposit and property (Oh, the old Kiwi dream). While property seems out of reach and interest rate on term deposit are hitting all time low, Kiwis are looking for another way to invest for their future.

Before you jumping into the world of investing…

You should put your money to invest after you pay off your consumer/personal debt, join KiwiSaver, and have an emergency fund. I believe you are not in the position of investing if you still haven’t got your financial basic sorted out.

The most important question

The first thing you’ll need to work out is How long can you leave the money in the investment? or how long before you will need to use that money?

If you are saving for a new car in 3 years, then 3 years is your answer. If you are saving for retirement and you are 30, 10+ years will be your answer.

Make sure you have money set aside for emergency before you invest. You don’t want to be in a situation where you plan to invest in the stock market for 8 years, some emergency happen in year 2 and you are forced to sell your investment at a loss.

Once you’ve worked out the time, apply that to the graph below.

where to invest HMobile-friendly version


Let’s say if you plan to invest for 6 years, according to the graph, you may want to consider invest 60% of that money into growth assets such as stock, property, ETF, and index fund, while the other 40% investment into Bond or Dividend stocks.

If you invest for your retirement in 20 years, you may want to have a portfolio with 5-10% bond and the rest with stock.

On the other hand, if you wish to use the money to buy a car in 2 years. It’s best to put it in a term deposit.

Break down your plan

You may have multiple plans for your money, such as $3000 for travel next year, $12000 for a new car in 30 months, and $20000 for the first home in 8 years.

You need to apply those plan individually to the graph.

$3000 travel fund in saving account

$12000 car fund in term deposit

$20000 in a 10:90 mix portfolio while you keep adding more into the investment every month.

What’s next?

I will explain the basic idea of this graph, the mix of investment in this post and how to apply risk tolerance in the next post.

The timeline and investment ratio on the graph are based on my own study and conventional wisdom. Investment suggestion is based on neutral risk tolerance. Investment product listed on the graph are based on popularity, ease of access in New Zealand and a bit of personal preference.

Just a reminder, this graph is for GENERAL ADVISE ONLY. Your own situation may be different. Please thoroughly research everything you read here and seek professional advice if you need to.

Email thesmartandlazy@gmail.com or follow me on Twitter @thesmartandlazy if you have any questions.

4 thoughts on “A Simple Graph that explains… where to invest your money

  1. Pingback: Where to invest your money in New Zealand (Part 2) | The Smart and Lazy

  2. Pingback: The Best way to start your investment as beginner in New Zealand | The Smart and Lazy

  3. Hi Alpha, I was wondering how you would go about investing for different goals at the same time. I opened an account with Superlife and I have a goal for a timeframe of 5-7 years and another one for 15+ years. Would you advise to invest in a single portfolio and dip into it from time to time, or to have 2 separate ones? Thanks for the great articles, it really helps me get started.


    • Hi Victoria, that’s a great question! Good enough for me to write a blog about it later.

      Anyway, the answer is to have 2 different portfolios/fund by using MyMix function.

      Its great that you are with Superlife because they have the best solution for your problem. Let’s say you have $10,000 now and want to allocation 60% to your 5-7 plan and 40% to your 15+ years plan. You want to use Superlife 30 fund for your 5-7 years plan and SuperLife 100 for your 15+ years plan. Also, you want 70% of your contribution goes into 5-7 years plan and 30% goes into 15+ years plan.

      With SuperLife MyMix function, you can set the initial amount on each fund by amount or percentage. So you put $10000 into Suerplife, set the initial amount on Suprelife 30 to $6,000 and Superlife 100 to $6,000.

      You can also allocate your monthly contribution into different funds as well. So you set 70% goes to SuperLife 30 and 30% goes to SuperLife 100.

      The key point is DO NOT use rebalance function if you want separate those funds and let them grow on their own.

      Let me know if you have any questions!


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