SPEAKER_00 0:10

Hello and welcome back to that Homeland Hub. Today I have a special guest for you. I've got Elizabeth Maloney Gaini from Know Your Worth. Hello, Elizabeth.

Meet Elizabeth and Know Your Worth

SPEAKER_01 0:20

Hello. It's nice to be here. Oh, thank you so much. How are you? I'm very well. I've got had a beautiful day for driving up the coast to you. Lovely. Because you are based in? I'm in Newtown. So absolute opposite end of Wellington from you.

SPEAKER_00 0:35

Yeah, but luckily with the new road, it's not that bad, right? No. And it was just beautiful.

SPEAKER_01 0:40

It was gorgeous.

SPEAKER_00 0:41

Nice. Thank you so much for coming in. We've hit it off, I believe we met a few years ago at one of the events. And then we've seen each other here and there. And then you reached out to me. And I was so happy you reached out because you've got a very important message to share. And I'm so excited to see how your journey has evolved over the last few years. So without further delay, let's tell the listeners who you are and what you do.

SPEAKER_01 1:09

Sure. So yeah, I think we met a couple years ago at um one of the industry events, which was great because it's always fantastic to meet more women in the

From nursing to finance

SPEAKER_01 1:20

finance industry. I actually came from doing nursing in my 20s, and obviously that was a very female-dominated area. And then changing into when I had my daughter and I was briefly a single mom, I was looking for a different career, something with better work-life balance, better earning potential. And I decided to retrain as a financial advisor. And that was a big shift into a male-dominated industry. So a big learning curve moving into a corporate environment, complete career change, different kind of attitudes. And I knew from the start that what I wanted to do was help women with their finances. And so then I've had a bit of a journey in the industry since then. That was sort of eight years ago that I retrained. And then this year, been fortunate enough to start my own business, Know Your Worth, which is largely aimed at helping women and their families with their finances.

SPEAKER_00 2:14

I love it because they're worth it. Exactly. You should know your worth. Yeah. And I think this is really important because, you know, looking at the statistics, you're right. There is more males in our industry. There's not enough females. And I think this is why, you

Why women need tailored advice

SPEAKER_00 2:30

know, I've been placed to cheer Women in Financial Advice New Zealand because I've been so vocal about it that we need more females. We need more women in our industry because naturally, when a woman is going through life-defining moments, she wants to turn to another woman. Exactly.

SPEAKER_01 2:47

And that's what I was finding was that a lot of the advice for women or for anyone around money was based on men's experiences. So it didn't take into account things like stopping for having children, didn't take into account the pay gap, didn't take into account maybe what happens when you get divorced, the different outcomes for men and women. So all the advice that was available wasn't really tailored for women. And then that was kind of contributing to maybe women not engaging with financial advisors or not getting the same outcomes when they do.

SPEAKER_00 3:22

I think your confidence gets hit quite significantly when you're going through something significant, you know, whether it's having a child, um, because your body's going through so many changes and hormones, etc. So this is where, you know, your confidence might get a knock. Then you get another confidence knock when you're going through a separation. You know, you've been there, I've been there, so I know what it's like. And I think, you know, not already feeling a little bit bruised and battered, and then trying to go and seek that financial advice. And if there is a man on the other side of it trying to mansplain to you of how you should do life from his perspective, it can be daunting and it can be off-putting.

SPEAKER_01 4:02

Yeah, and and sometimes just you don't build that rapport and trust that you build with someone who has genuinely like experienced

Confidence, life events, and trust

SPEAKER_01 4:10

the same things you have and can really relate. Um it's almost like the sisterhood. Yeah. Isn't it? Yeah. Um and I think that's what I'm aiming to do is provide uh a person that is relatable, uh, trustworthy, not intimidating, um, all of those things, and also to be present in people's lives before something has happened, before the significant event. So that it's just reaching out to someone they already know or they've been communicating with in the past or they've seen online or something there's a level of familiarity. It's not having to take such a big step to go seek a professional that's a complete stranger when something goes wrong.

SPEAKER_00 4:51

Yeah, I love it. Cool. So, what do you do as part of your services? What do you do?

SPEAKER_01 4:56

So I am basically doing everything except mortgages, um, is is how I often describe it to people because when they think money, they actually do think mortgages top of the list. You can send them, you know, exactly to a mortgage broker, I know. Some really good mortgage brokers. Um but I do some stuff in the insurance space, Kiwi Saver, investments in the sense of like managed funds, generally speaking. And then I have two financial planning services, a comprehensive plan, and then kind of a mini plan that I call a decision-making session for people who just want to solve one issue.

SPEAKER_00 5:33

Yeah. I love it. Okay. And who is your target audience? We talked about women, but what sort of women and where are they?

SPEAKER_01 5:42

Yeah. So firstly, it's not, of course, exclusive to women because if you are in a relationship or a partnership with someone, I definitely want to be working with the whole family. Awesome. Um, but women, especially professionals, I feel like age-wise, I work with anyone from kind of my own, like in their 30s all the way through to women in their 60s. Um, so age is very broad, but it's generally, I often describe it also as people that don't feel like traditional financial advice services have worked for them. So maybe they just are a bit lacking in the confidence or they don't like the idea of going to like an office in Lambden Key with stuffy suits. Um, that's just not what they're looking for. Uh yeah.

SPEAKER_00 6:29

Awesome. I love it. And I love that you do uh do families because I think that's very important when we're in a family and we need to be speaking the same financial language, or at least be on the same financial uh destination in a way, because I feel like this is where majority of relationships fall apart is when she wants to go this way, he wants to go that way, and they just don't see each other eye to eye when it comes to money 100%.

SPEAKER_01 6:58

And I think sometimes you can end up being um you can end up being in the middle and like a bit of attention, or you can be

Services beyond mortgages

SPEAKER_01 7:05

the person that's facilitating a conversation because maybe they haven't actually had that conversation between themselves before. And then when you sit down to build a financial plan and they both share what's important to them, you get to tease that out a little bit more and find out, well, what are the priorities and what would have to give? And that can actually be really helpful.

SPEAKER_00 7:24

Yeah, I love that. Often I refer to myself as a financial therapist. Yes, because and I think you'd be the same, right? We we sit down with couples that probably never even talk to each other um before about their goals and their dreams and their aspirations or their fears. And and sometimes it comes out in conversations where she might say, No, I don't want to do this because I'm scared that you know this will happen. And and our job as advisors to show them, okay, this is the worst case scenario, but this could be the best case scenario. If you did XYZ now, this is what you will end up with. Because um, I don't know if you know, but I went uh a couple of weeks ago to Auckland and we were the presentation of this research paper that was done around the gender uh pay, you know, was ordered by a retirement commissioner, and they were looking into what's happening with pay and what's happening with women when they retire. And it was crazy, you know, it was like 28% of women retire with less money than men, and sometimes it could be like 300k less than men because of the life stages that they go through, often taking time off work, looking after the kids, or working part-time hours, or not earning the same level as men. So when it comes to retirement, they don't have enough money. So, how can you change that narrative for women?

SPEAKER_01 8:40

Yeah, I think that's um is a really good point because the the gap in Kiwi Savers is something like 25% between men and women, and that increases for

Couples, conflict, and money alignment

SPEAKER_01 8:50

women between 56 and 65. It's 37%. So that's right when it's crucial. Um, I think that the key things are helping people to find out what is the best way to generate wealth for their retirement. What does retirement mean to them? Is it about stopping work at 65? Is that something they want to do earlier? Do they want to keep working past that? All of those questions because we just um sometimes fall back on these assumptions that I'll work 40 hours a week till I'm 65 and then I'll stop and then I'll be fine. And there's no exploration of is that actually the life I want between now and 65? And what is the life I want and how am I going to fund that? And then from the actual investment point of view, especially with changes to KiwiSaver this year in the budget, um, KiwiSaver is not always the right thing. It's definitely not going to be enough on its own for most people. So what are you doing outside of that? And Kiwis are so traditionally property focused. A lot of the time I'm actually just educating people on the fact that managed funds are another option for them, which is essentially like your Kiwi Saver, same diversification, same regulations, all of that, equally safe, but without the restriction that you can't get it for 65. So if you were gonna stop working early and you did want to access that, you could do so.

SPEAKER_00 10:10

Yeah. Because another research that scared the bejesus out of me was around how much money you need to when you retire. And it was scary because you know, a lot of couples will need more than $1,200 a week, let's say, yeah to continue to live, you know, and this is because the rates and insurances, even if you own your own home, mortgage-free, you still have that cost. And then if you want to travel, if you want to still eat nice food, and usually as you get older, you probably want to eat a nicer food. You don't want to be on spaghetti and baked beans. Exactly. Right? So, um, so where do people will find this money? Because soup is not enough. The, you know, the pension that they get is just absolutely not gonna cover that cost. So that's really nice that you know you can help them to see that projection. And if they the earlier the start, the better. Exactly.

SPEAKER_01 11:04

Yeah, the the earlier you start, the better, the more you diversify. So it's great to think, okay, maybe in an ideal scenario, there'll be the super, there'll be my Kiwi Saver, there'll be some investments out of KiwiSaver, and maybe property as well. That's great because then you've got four things you're relying on. So if the government changes the rules and super drops out of the equation, or the government changes the rules on KiwiSaver, like they have been recently, you've still got some other lines of income or or wealth for the future that are more within your control. And I think that's also something that uh people in general, not just women, are wanting because we've been living through uncertain times, they want more control over their future and their finances. And this is a way that they can actually get some clarity on where am I now? Where do I want to be? And what are some things that I can control personally?

SPEAKER_00 11:57

Yeah. Yeah. And I love that. I love that we can take ownership of these things now instead of sitting and then, you know, blaming someone else that we don't have enough when we retire. It's taking control of your situation

The gender gap in KiwiSaver and retirement

SPEAKER_00 12:10

and seeing what you can do. So, I mean, when you start in your 30s, you know, you still got a bit of time. But what happens when you like in your 60s?

SPEAKER_01 12:20

Yeah, I mean, it's obviously trickier the shorter your runway is. Um, I've had a few women come to me recently in 60s and and even 70s where they're looking for investment advice, but it's very much with a different lens of they've had some exposure to investing in the past, um, and they've now come into extra money for whatever reason. So I think people are getting inheritances later and later. So there are people who maybe previously would have got an inheritance in their 40s, 50s. It's now actually not coming through till 60s or 70s. And then you have this lump sum, and you're not going to necessarily want to do anything aggressive with that or or be risky in investing it. But they are women who also have understood the risk of inflation. And so they don't just want to put it in a bank account and see it erode. They want to make sure that they're being prudent with it. And that's where they've come to look for some advice. And one thing that I have a particular um pet peeve about are some funds which are called life stage um funds, which I'm sure you're very familiar with. Um, where they assume that you should be in a particular fund. And when I say fund, I mean like conservative balanced growth, that different risk level. They're assuming it based on your age and your age alone. And for me, that's the complete antithesis of what we should be doing, where we're looking at someone's situation and personality and then recommending how they should be investing their money. Because I've had a lot of women where actually they're comfortable enough. It doesn't need to be a super conservative fund, even though they are at that stage of life, um, because they've got a secure base. They can actually still be affording to take a little bit of risk to get a little bit of growth, because maybe they don't expect to be using this. They want it to be safe enough in case they needed it. But actually they're more thinking about their estate. They're more thinking about their kids and their grandkids in terms of what the likely intention of that money is. And we just need to make sure there's enough of a safety net that if they have a health event, if something happens, they do have access to the funds they need. But beyond that, they don't need to be putting it in a term deposit or under the mattress. They can be investing it um in an appropriate way that maximizes what they could be getting for themselves and their families into the future.

SPEAKER_00 14:46

Yeah, it's a really interesting point because there are two things that happened uh for people in that generational group is one where they saw the rise and the fall of the investment properties, um marketing, you know, when there was invest into this and then you can get this, and then the property market has collapsed and they've lost their um investments. I think a lot of um people in that generation, when I spoke to them, they invested into like apartments in Auckland, you know, those blue chip apartments and things like that. So when things went wrong for them, so investing into property they usually don't believe in, yeah, they're scared because they've already lost the money before back in the 90s. They don't want to lose the money again. And as you say, the second thing is they can see how much they earn through the bank accounts and term deposits, and that's not really attractive to them, and they want to maximize the money because they don't really need that money

Building diversified income for later life

SPEAKER_00 15:40

right now, but they want to set up their kids and their um grandkids, etc., for the future. But also remember, right now we're seeing the largest generational wealth transfer. Yes. Right? All the baby boomers.

SPEAKER_01 15:52

They have some stats for me. I was just gonna say I looked up the amount and it was predicted to be $1.6 trillion of wealth transfer by 2050 in New Zealand.

SPEAKER_00 16:02

Yeah.

SPEAKER_01 16:02

Like it's and it's mind-boggling numbers.

SPEAKER_00 16:05

Yeah. Um there's a lot of money. And if people don't know what to do with that money, they're just gonna blow it.

SPEAKER_01 16:11

Yeah. And I think that's a problem, is that um we don't really talk about money. I mean, honestly, if there was literally one takeaway for people, it would be to talk about money more, like with your friends, with your family, with everyone. And they start out as really awkward, stilted conversations. But the problem is that we've got people who are either don't know that there's money coming to them and aren't preparing and aren't financially savvy when it arrives. And then the opposite of people who I had someone recently who said she's not worried about retirement because her parents are asset rich. And so although they can't help her now and she's actually struggling right now, eventually their properties will be inherited by her. And so she's not worried about the future, which is a really interesting perspective because we never actually know what's going on in someone else's finances unless we've had those super transparent conversations. Um, so there's always the risk that you're counting on something that's not coming, or there's money coming your way, which for a lot of people there will be, and you're not prepared at all. And yeah.

SPEAKER_00 17:12

And I've seen that before. I had a really terrible example when I was at the bank and this couple came in and they were probably in their 50s or even 60s, and they had so much debt. Oh my god, they had like personal loans and car loans and this and this and that. And they still didn't have a house, they were renting, and they needed me to do debt consolidation for them, you know. And I was like, hey, what's going on? You know, how come she got so much debt? Like, you guys both earning good money. Um, you should be really thinking about debt consolidation and then looking to buy a house, like start preparing to buy a house. And she said to me, Well, it's all my mom's fault. I was like, Oh, okay, what happened there? She goes, Well, she died and she left everything to my stepdad, and the bugger lived for another 20 years, and she and he's still alive, you know. So she thought that when her mom dies, she will get a portion of whatever. But obviously, with the you know, law how it works, everything went to him. And once he dies, then it will be passed on to the children. Yeah, but nobody expected him to live this long, and he's already like in his 90s and he's still kicking, and he and he's not planning to die anytime soon. Of course. And meanwhile, this woman thought, oh, you know, I'll have I'll have this money coming in, so I'll just live large. So I'll buy the latest car, I'll buy the boat, I'll go on holiday. You know, so she's been spending the money that she doesn't have, and she's relying

Late-life investing, risk, and lifestage funds

SPEAKER_00 18:30

that there will be inheritance coming through. And I said to her, You're 60 years old, and you're waiting for someone to die to get ahead. Like, come on, you know, let's face the reality here. Like, this is not she didn't like me that day. Um, just saying. But I had to give her the harsh truth that this is not okay. You know, you should be in control of your own money. You earn good money. So what you can be doing is paying down your debt and using your KVC to buy a house or, you know, putting that money aside, doing something about it. And if eventually, God forbid, he passes away and you get something awesome. You can pay down your mortgage, you can do this, this, that. But living right now in the moment and blowing all your money, because you're hoping that one day you'll get this uh windfall of funds coming through, that's just not a good way to be.

SPEAKER_01 19:21

Absolutely, yeah. I think um, whenever I do financial planning with people, and we'll talk about, you know, is there any lump sums expected to come in, sale of property, sale of business, all of that. Anyone who's mentioning an inheritance, it's noted, but it's not included in their modeling because how do you put a time frame on where you're gonna get an inheritance? Um that feels very morbid for one thing. It does, right? It's wrong. And it's also just not a guarantee. Um because people are living longer, they need the money in retirement. Yeah. And then that comes back to that whole question of how are you preparing to have enough so that you're not struggling when you when you get to that point. Uh yeah.

SPEAKER_00 20:04

When you do those uh meetings with people, do you find that a lot of people have budgets or they don't? Like what's your experience with financial literacy?

SPEAKER_01 20:13

I would say a lot of the women who come to me, and I think this is probably because of the personality types that I'm attracting, do. They are largely quite conscious of money, um, but they're lacking confidence. So they're keeping track of things, they have budgets, they have spreadsheets. Um so that's great. But then they are either struggling to kind of identify a surplus. So they're kind of they they feel like there should be money available, but where is it going? Um, or they've got it and they're just squirreling it away, which is also really common. They'll have a savings account here and a savings account here and a little bit in Sherzies and there's Kiwi Saver, uh, maybe an account for their kids. Um, they haven't got any kind of plan around it and they don't have the confidence to boldly say, this is what I should be investing, this is how much I should be putting away, this is where I should put it, this is when I'm gonna access it. Yeah. And that's where I spend a lot of my time is helping them with building that plan and helping them articulate what the goal is. Because the reason they're squirreling money away is usually just that gives them a sense of security. But there's no long-term plan. There's no, oh, well, this is gonna be for the kids' university and this is gonna be for my retirement. Because those would be totally different time frames, totally different funds potentially. Um, but they haven't thought that far, they're just protecting themselves.

SPEAKER_00 21:36

Yeah.

SPEAKER_01 21:37

Yeah. Particularly anyone who's been separated. That's a really common feature.

SPEAKER_00 21:42

Yeah, and and you're right, like usually I find that any moms that come to me that have separated, they usually have amazing budgets. Like they know exactly where money is going. But then they usually operate in that sense of in the space of dollar to dollar, week to week. And then they don't see where the surpluses that they can invest or they can do something with that money. And obviously, we are sitting at different spectrums of the investment, right? I'm more like property, brick, you know, tangible. Tangible, you can see it. And for me, it took me a while to wrap my own head around, you know, there are other investments as well. And especially when I see how things can go wrong in the property as well. Like, for instance, you know, earlier this year I had um I've lost two tenants, they've left the property absolutely damaged, and it, you know, it's costing me an amino leg to renovate them, and insurance is not paying out to the level of the damages. Yeah. So I'm only getting getting a small proportion of what the damages are. So now I'm out of rent, it's still not rented out, it's getting repaired. And so basically I've lost a whole year of income plus I need to pay for repairs. So when people go, oh, you know, investment are high risk, what's your take on it?

SPEAKER_01 22:56

Yeah, and that's the thing. I think people don't realize that property is considered a high-risk investment. It's one, it's meant to be a 10-year-plus thing. And we have had a bit of a culture of flipping properties, which is, you know, obviously has worked for some people, but isn't actually how you should treat it as an investment asset. Uh and the other thing is it's a lot more work. Yeah. Um, obviously, you can outsource a lot of it. You can have property managers and all of that. But personally, I like to think that I'm like a lazy investor. So if I can set up a managed fund, know that it's correct, set up

Property myths, risk, and time-poor investing

SPEAKER_01 23:30

an automatic payment to it, and then I just need to check in once a year with my advisor kind of thing. That's way more suited to my lifestyle of busy mum, running a business, got everything else on my plate. I don't want to actually have to look after a property with other people who are relying on me and things that can go wrong. Yeah. Um, that to me is like a lot more work. Awesome. So I do get a lot of people where they're like, I'm time poor, but I want to maximize my money. What can I do? Managed funds are great for that. Um yeah.

SPEAKER_00 24:04

Because that's the thing. Like at the moment, you know, there is not many cash-positive properties that you can get. Um, yes, it helps the interest rates are down. So if you're borrowing, you know, 500k to rent it out at $500 per week, but the problem is rates are going up, insurances are going up. So you've got all this extra cost that's built in. So properties, yeah, I'm doing the job for you. I'm advertising, I'm advertising your services really well here. Um, that sometimes it just doesn't make sense if you are after um, you know, hands-off investment. But I think like anything in life, you have to have diversification. Yes. And this is where, you know, I believe in property because I feel like I can see it. And eventually down the track, if I need to bulldoze it and build 10 townhouses there, awesome, you know, I can do that or my kids can do that. I've got something to pass on to the children. But okay, where else can I put my money? You know, is it managed funds? Is it increasing increasing my Kiwi Saver? What is it? And this is where I believe, you know, you and I have chatted before the recording is people think sometimes it's a cookie cutter solution, right? But it's not. Tell me about this.

SPEAKER_01 25:10

Yeah, I think people, when they go online and look for information on finances or investing, they get one, overwhelmed by the amount of information, and two, then they end up going for what's the most generic advice that feels easy. And they get this cookie-cutter approach. But your finances are as personal as how you've decorated your bedroom. It's as personal as your fitness regime. It should be actually custom-built for you to suit your lifestyle, your goals, your approach, like your risk attitude, how you and your partner feel about money combined. Like it's there's so many layers of nuance for it to be effective and for you to actually achieve the goals you want to achieve. So speaking to an actual advisor and getting that personalized plan is really key because I do think it's there's so many parallels, I think, with fitness and health is that we all know we should like eat better and exercise more. But actually doing it is really hard. And following someone else's plan isn't going to work for me. And it's the same with, oh, I know I should be investing regularly, and I know I should be making sure I've got the right insurances and I'm paying down my mortgage with the right strategy and all of this stuff. But doing it when you don't have a professional to help you build the plan and then keep you accountable is so tricky and and you will kind of

Diversification over cookie-cutter advice

SPEAKER_01 26:30

fall off the wagon and default to whatever your habits are. And we all have these habits from childhood that we're not really conscious of, but they're there underneath everything. Um I love it. Yeah.

SPEAKER_00 26:44

So where can people find you?

SPEAKER_01 26:47

So um I am on Instagram primarily in terms of social media. Um so knowyourworth.nz is me, and I'm fairly active on there. I do have I'm on LinkedIn, um, so I do try and post on there when I can. Um I do have a website, Know Your Worth. The one thing I don't have are business cards, which is handy because you don't need them for a podcast. Um, but I'm working on that. And yeah, I'm happy to work with people sort of in person or online around New Zealand, totally fine. But I just I think that women, when they invest, do better than men. But we just need more women to feel confident starting to invest. And so the other thing that I saw recently was that only 33% of women identify as investors. And I just want to say anyone who has Kiwi Saver is an investor. You are an investor whether you identify as it or not. So you may as well be making sure that it's set up correctly, that you're not over investing in Kiwi Saver, that you're diversifying, that you have the right plan for you, so that we can actually keep that stat of outperforming the men, because that's a pretty handy thing to be able to tell someone when they're trying to mansplain to you. As um actually the stats show we're better at it when we do it because we do our research first. We're calculated risk takers and we stick to the plan.

SPEAKER_00 28:20

I love it. I love that summary. Thank you so much. I'll hope to get you back for another podcast episode that we can do and uh dive a little bit deeper into the topics of our choice. But um, I think this is really, really important message to your listeners out there that whether you're a woman or a male, you should know what you're doing with your money. Because if you don't know what you're doing with your money, who's gonna know? Exactly. And the people that will know what to do with your money, trust me, they're not gonna have sometimes your interests at heart, right? So you need to be in charge, like you're in charge of your health, you're in charge of your car, taking it to service, you're in charge of um, I don't know, even if you like bike, you you know, you want to make sure your tires are pumped. Yeah, right? Same with your money. You need money to use every day and for the future, and especially if you have a family, you've got that responsibility. So don't pass that responsibility on to someone else and forget about it. You know, reach out to advisors, we're here to help. And um, I'll see you again. Thank you so much. Thanks.