Market ups and downs are nothing new, but in recent months, investors in New Zealand have seen an increase in volatility across shares, property, and global markets. Whether driven by shifting interest rates, global economic uncertainty, or geopolitical tensions, fluctuations can leave investors feeling uncertain about their financial future.
What’s Driving the Volatility?
A mix of local and global factors has contributed to market movements:
Inflation & Interest Rates: The Reserve Bank of New Zealand’s efforts to control inflation by raising interest rates have affected mortgage affordability and consumer spending, which in turn impact company earnings and share prices.
Global Uncertainty: Ongoing geopolitical conflicts and international policy shifts (like those in the U.S. and China) are creating ripple effects felt here at home.
Post-COVID Adjustments: Many sectors are still finding their footing after years of disruption, leading to unpredictable economic indicators.
What Should Investors Do?
The key to navigating market volatility is having a clear, long-term plan and staying grounded during periods of uncertainty. Here are a few important strategies:
Stay the Course: Volatility can be unsettling, but making emotional decisions during market dips often leads to poor outcomes. Long-term investing has historically outperformed attempts to “time” the market.
Diversify: A mix of asset classes—shares, bonds, property, and cash—can help cushion the impact of swings in any one area.
Review, Don’t React: Volatility is a great time to review your KiwiSaver or investment plan. Are your goals still the same? Is your risk level appropriate for your time horizon?
Focus on What You Can Control: You can’t predict the market, but you can make sure you're contributing regularly to your KiwiSaver, managing debt wisely, and sticking to your budget.
Need Help Making Sense of It All?
You don’t have to navigate this alone. Now is a great time to sit down with a financial adviser for a KiwiSaver health check or a full investment review. Whether you’re planning for retirement, saving for your first home, or just want to feel more confident in your finances, professional advice can help you make informed decisions in uncertain times.
We can also help if you're not in KiwiSaver yet—or want to enroll your children or family members to get them started early.
Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.