BusinessDesk investments editor Frances Cook responds to emails from readers each week to answer questions about money. Below, you will find her expert advice. Send your own questions to [email protected].

Hi Frances,

I'm a great fan of the CTB podcast. I have a question for you that may warrant its own episode; not sure.

So there have been quite a few episodes on paying off mortgages faster – which is all cool in these times, though they seem to be focused on younger people starting their housing journey early and paying off their mortgage quickly, using side hustles, aggressive saving plans and so forth.  

Completely get that, though one financial challenge that doesn't get spoken about often is those people that, for various reasons (though generally divorced) find themselves in their mid-40s or so, with absolutely nothing.   

There's the "how do you recover financially" aspect with retirement, not an awfully long time away, though also the emotive challenge of having worked or raised children for 20 years and circumstances have meant that they have nothing in financial terms to show for it.   

Sometimes the person does have high earning potential, though there are many that do not, and that's a real challenge. Of course, when you add kids into the financial mix ...

I suspect that a discussion on this is likely to be part financial advice and part therapy!



Hi D,

Yes, you’re right. A lot of money advice focuses on helping young people at the beginning of their journey.

Two reasons for this: one, sometimes the hardest part is getting started, so helping people just get going can be important.

But two, it’s a lot easier to make good progress when you have time on your side.

So in some ways, younger people are an easier group to give advice to. Sure, they often don’t have much money yet, but they do have time, and you can do a lot in that situation.

Meanwhile, as you rightly point out, plenty of people hit their 40s and realise that, for whatever reason, they’re not where they want to be. They may need to start over after a divorce, or a failed investment or business.

Or they may never have started with their money journey and planning for the future, yet here comes ‘tomorrow’, closer by the day and looking a bit scarier.

When it comes to planning your financial future, you need to commit either money or time. If you have less time, you’ll need to put in a bit more money.

That might sound intimidating, but I think the trick is to focus on what’s achievable for your situation.

The bottom line is that it’s always the most important to do what you can. $5 towards your future is better than $0. Of course, $50 or $500 is even better again. Everyone is in a different situation.

So I’ll lay out what I think are the priorities, and then it’s up to you to decide how hard you want to run at these goals.

To start

Sit down to take an honest look at your finances. If you need to bribe yourself by doing it with a glass of red wine and some chocolate in hand, go for it. But make sure you do it.

Look at your regular bills, and how much your life costs. How much do you need per year to have an enjoyable life? What about just for survival?

You want to know what your barest baseline is, and also what your nice-to-have level is. 

If you’d like a free tool to help you with this, check out the Sorted budgeting tool here. It’s free, it’s independent, and they’re not trying to sell you anything. It’s just a helpful tool.

Once you know how much you need, truly need to be spending, we have two new pieces of information up our sleeve.

One, you know how much cushion there is in the budget, and therefore how much is spare that you could be putting towards future goals.

Two, you know how much your life costs now, which changes how big a nest egg you want for the future, in order to continue your lifestyle.

Building the nest egg

First up, check your KiwiSaver. If you’re trying to make up for the lost time by saving as much money as possible, it’ll help to be saving other peoples’ money too.

When you save into KiwiSaver you get an employer match and a government tax break. This doubles your money before you even start making a return on your investments.

So make sure you’ve got KiwiSaver up and running, and also in the right fund for your life stage, whether that’s conservative, balanced, or growth.

Seeing as you’re talking about someone in their mid-40s, I suspect a growth account would be a good idea. 

However, as I often say, I don't know your full situation. You can take a quick quiz to see which KiwiSaver type is best for you, and then compare the funds available, using the KiwiSaver Fund Finder here. Again, free, independent, and not trying to sell you anything.

Level up

Once that’s done, it’s time to consider investing outside of KiwiSaver.

The reason I like this is that you can start with wherever you are. Buying a house and paying it off is well and good, but saving up for a deposit can feel like a big goal that you may never reach. 

If a goal feels too big, then sometimes people won’t start at all. If someone is feeling dispirited and behind in mid-life, the last thing we want is to discourage them any further.

Meanwhile, if you invest in the share market, you can put in $5, $50, $500, or whatever you have that works for you. You can get going immediately, and taking action feels good.

There’s no amount that’s “too small” to bother with. 

You might only save up enough to pay electricity bills through winter in retirement. That’s worth it. You might save up enough to be able to take the grandkids out for the occasional treat. That’s worth it. You might save up enough to fund your entire lifestyle continuing through retirement. That’s definitely worth it.

Someone in their mid-40s still has 20 years to go until retirement, which means there’s plenty of time for a good amount of progress.

It also means they’re a good candidate for higher risk, higher return investments like shares and property. These investments make more money, but can go up and down in value along the way, which means you usually should plan to hold on to them for 10 years or more.

With 20 years (at least) up your sleeve, you can get through two good cycles, and make a decent amount on whatever money you put in.

The earning side

You mention how much it helps if someone is earning more, and yes, that’s true. If there’s any room for a pay rise, promotion, or another way of increasing earnings, it’s worth investigating.

Research by Strategic Pay showed New Zealand employers have already budgeted for average salary increases of 4.3% over 2023. 

That’s an average, so some will have more in the budget, others less, but it shows it’s worth having the conversation. Lots of industries are experiencing worker shortages, but it won’t last, so don’t delay talking to the boss about it.

"Nothing to show for it"

As a last note, you mention the frustration of having 20 years of work and raising a family behind you and nothing to show for it.

I respectfully disagree. There is of course, the slightly twee point of view that having children is its own reward, which I do believe, but it’s probably a nauseating point of view that nobody wants to hear when they’re worried about their finances. Fair enough.

I would also point out that 20 years of working and earning gives valuable experience, that you can hopefully use to leverage yourself into higher earning roles. You’ve also got life experience which helps kick your butt into gear on the other points mentioned here.

You're not a 20-year-old heading into the workforce for the first time. That experience is worth something and can be turned to your advantage, even if you haven't done that so far.

Then there’s the point of view that no man is an island. Having a community and family can also be very helpful for sorting out finances.

Having people I can rely on in a pinch gives me the courage to take risks, knowing there are people to help if it goes wrong. 

There are also smaller daily things, like being able to borrow tools for DIY projects, instead of buying them. Being able to call grandparents for babysitting instead of paying someone. Having people to come around for a working bee, instead of doing it all myself.

A community can be an underrated boost to wealth, and if you can get the kids on board with whatever changes you’re making, it can really help. 

Even if the kids just know about your goals, and help keep you motivated and on track. That's valuable. Cheerleaders can keep us going. Get everyone on the same team and working together.

These are the less tangible parts of making a money change, but often they’re just as important. So don’t discount them.

Send questions to [email protected] if you want to be featured in the column. Emails should be about 200 words, and we won't publish your name. Unfortunately, Frances is not able to respond to every email received, or offer individual financial advice.   

Information in this column is general in nature and should not be taken as individual financial advice. Frances Cook and BusinessDesk are not responsible for any loss a reader may suffer.