Passive Income NZ
What is Passive Income?
Passive income investments refer to any investment that generate regular cash flow or income without requiring active investor involvement. In essence, an income without having to do too much work, and ideally not too much risk.
For most investors, this will see them;
- Taking steps during their working lives to put in place a strategy that will either deliver income for them immediately
- Or develop a large amount of capital ready for them at retirement. Then, at retirement, the capital can then be reinvested into income earning assets. Its about creating long term financial stability.
If you are wondering if taking steps to develop passive income NZ is right for you, then you may want to consider;
- That for most of us, when we are working, we have income. But when we stop work, unless we have taken steps during our working lives, then in the weeks after we finish work, our income will come to an end.
- The current NZ pension varies from $681 per fortnight through to $1,043 per fortnight depending on your situation and living circumstances. But with the modern cost of living, most people want more than this to live on. With a portfolio of Passive income Investments you can supplement your income to a life that you feel more comfortable with.
- On top of that, we all want financial freedom – the choice to make our own decisions on our terms. This could include being able to update the car, travel, home renovations. Or support our children and grandchildren in a way that we would like.
Top Passive Income Opportunities for New Zealanders
Term Deposits
When interest rates are high, investors will often be attracted to term deposits. And for passive income, they will choose to have the income paid out to them. Often seen as the safest of all investments, but when properly understood may not allow you to keep up with inflation and can therefore lose their value in real terms.
Peer to Peer Lending
Peer-to-peer lending involves investing in loans provided to individuals or businesses through online platforms. These loans generate interest payments that become a source of passive income income for the investor. If you are investing in this area, you want to understand what happens if the loan goes bad. Who recovers your money and what is the risk to your funds.
Residential Investment Property
Often seen as a first area to think about investing as people can easily understand it. And as long as you are prepared to stick at it, it has been successful for some. However, in recent years, with the cost rises in rates, insurance and repairs and maintenance it is becoming less attractive. And with the rise in tenants rise, some are considering alternatives.
Commercial Property
For those that want a higher yield than residential property or who are in the property industry, they will often invest in commercial property. The yield is higher and costs of insurance and rates are for the tenant. However, risks can be high with periods of tenant vacancy, building obsolescence, and incurring fitout costs. Success in this area can be specific on a nuances such as tenant and location.
Dividend Stocks & Bonds
Investing in dividend stocks bonds is often seen as the ultimate in passive income. Purchasing a portfolio and let the income roll-in is the idea. However, while the income is considered to be the highest of all the investment classes, there are risks including the capital value of your portfolio which can go up and down significantly. In this area, many would suggest the help of a Financial Adviser.
How We Help with Passive Income Investment?
Earnslaw Goodlight offers personalised investment advice to help you;
– create the capital base that will later be redeployed into a passive income portfolio.
-Or help you with your passive income portfolio now.
Our work will take into consideration your financial goals and risk tolerance.
Here is how our team can help you with passive income investments:
Understanding Your Finances
In the initial consultation, our financial advisors will take time to learn about your current financial situation, including your income, expenses, and investment goals. Based on your risk profile and financial goals, we will provide you with what we believe to be the best insights and investment options for your passive income portfolio.
Creating a Customised Investment Plan
We create a tailored investment plan based on your financial situation. Our recommendation will include investing in bonds, shares and other investments classes that allow us to meet the financial objectives, such as real estate investment trusts (REITs). And to limit downside risk, we will also look to provide a diversified portfolio.
Ongoing Portfolio Management
Most people’s financial situation is constantly changing as are market conditions. We monitor market trends and performance, of your passive income portfolio to remain on course to deliver consistent returns. We also adjust your portfolio to align it with market shifts and inform you about all necessary changes.
Contact Us Today for Passive Income NZ Solutions
If you would like to talk with someone about where you are at in the journey to create passive income, then we are here to help. We provide personalised and tailored advice to help you achieve your financial goals.
Frequently asked questions
How can KiwiSaver help with generating passive income?
KiwiSaver offers different investment options, including growth and conservative funds, which can generate passive income for investors over time. It is a great long-term savings option that can provide financial stability in retirement.
What are some low-investment passive income ideas?
Some low-investment passive income ideas include:
- Lend money to peers
- Rent out your spare room
- Invest in REITs
- Invest in bonds and stocks
How often should I review my passive income investments?
It is recommended that you review your passive income investments at least once a year. However, it is also essential to review them whenever there is a significant change in your life, such as getting a new job or experiencing a financial windfall.
