Psychology of Money

The following is a selection of articles mainly from January 2005 to the present. To explore this topic in more depth and access earlier columns, please use the search box.

Articles

NZ Herald 16 March 2013

Q&As: Student loan question brings out the differences in a couple's attitudes to money
- 2 Q&As about making use of the student loan repayment bonus - which expires on March 31 - while students are still studying
- Clarification of some tricky wording about student loans
- A warning for couples: Relationship property agreements should not be DIY

Syndicated column 16 February 2013 - Financial misbehaviour disappointing

Ironically, a survey on New Zealanders' financial behaviour was released just days before Christmas - a time of much financial misbehaviour, when everyone's saying, "I don't care what it costs, I've just got to buy something for Uncle Fred."

NZ Herald 24 November 2012

Q&As: Lessons from a bad managed fund investment
- An older reader's tips on money and life
- Do parents commit their children to KiwiSaver if they sign them up?
- Meaningful Christmas giving

NZ Herald 29 September 2012

Q&As: A couple of concerns about buying shares in the company you work for
- Bank's mortgage changes don't look like profiteering
- New graduate shouldn't bypass KiwiSaver
- 3 Q&As about gloomy predictions and investing in gold

NZ Herald 22 September 2012

Q&As: The hazards of comparing share and property investments
- 4 Q&As on whether we're headed for financial catastrophe
- Who can get the Carer's Benefit, and how much is it?

NZ Herald 25 August 2012

Q&As: 3 readers are upset about morality and student loan repayment strategies
- Is it better to take advantage of the student loan repayment bonus, while it lasts?
- Low retirement spending figures challenged

NZ Herald 18 August 2012

Q&As: New research helps to answer whether couple in early 50s should worry about how much they are saving
- KiwiSaver funds won't be the next finance companies
- Should young man overseas repay his student loan?

NZ Herald 28 July 2012

This week and next week, this column will publish excerpts from a small book Mary Holm has written for the Reserve Bank called "Upside, downside: A guide to risk for savers and investors". It will be given away free to the public in September. This column will tell you how to get a copy then. Today's excerpts include an overview and an example of one type of risky investor behaviour. Next week we will publish further examples.

NZ Herald 26 May 2012

Q&As: Reader dislikes "user pays" attitude and has a message for last week's self-proclaimed bigot
- Volunteers sought for overseas work and adventure
- Why young person who has moved to Australia might want to keep contributing to KiwiSaver
- Rules flexible for overseas KiwiSavers wanting to return to NZ to buy a first home
- A bank seems to be listening

NZ Herald 5 May 2012

Q&As: Reader could do with a re-think
- Economist calls for in-depth look at NZ Super
- Easy way to make KiwiSaver contributions
- Should we use KiwiSaver money to repay student loans?
- How about starting to charge interest on student loans?
- 3 readers remember what tertiary tuition fees were like in their day

Syndicated column 5 May 2012 - How the lolly choice has changed

The economists have given up on the idea, and it's time the rest of us did too. I'm talking about making financial decisions based only on the cold hard facts and numbers, and not taking into account emotional and psychological factors.

NZ Herald 17 March 2012

Q&As: No clear-cut answer on whether's it's better to slash debt or save for Christmas
- The best way to make use of the student loan repayment bonus
- Student loan holder living overseas is foolish to ignore his loan
- What's the point?

Syndicated column 10 March 2012 - Men don't have a monopoly on financial ability

New Zealand women are less confident about their finances than men, a recent survey suggests. Should they be?

NZ Herald 3 December 2011

Q&As: Is share buying just for the elite?
KiwiSaver first home buyer strikes a hitch - but all is well
60-ish couple could get into rental property
Did our couple blow too much on holidays?

Syndicated column 22 October 2011 - Who needs money when you've got what New Zealand's got?

New Zealanders, it seems, are better off than people in any other OECD country when we look at non-financial measurements. The saying "money isn't everything" rings true in this country.

NZ Herald 12 February 2011

Q&As: Here's an incentive to save for retirement
- Would increasing GST have to hurt those on lower incomes?
- Time to count a few blessings
- Lengthening the term of a mortgage can ease payments - but at a price
- Don't let tax drive your investment decisions

Syndicated column 29 January 2011 - Turning interest into your friend

New Zealanders are, apparently, a fairly satisfied bunch - except when it comes to our financial situation. But maybe that's not such a bad thing.

Syndicated column 4 December 2010 - Do we really need more stuff than Americans?

Something to ponder as Christmas gift giving approaches: New Zealanders apparently think they need more stuff than the people we often regard as most materialistic - Americans. What's more, older and male New Zealanders seem to be more into "things" than young people and females.

NZ Herald 4 September 2010

Q&As: Looking after the pennies is more rewarding than we realised
Three Q&As on readers' suggestions on how a couple can better manage their money - including ideas on mortgages and software
Is it worthwhile trying to time a home purchase to make the most of market movements? - plus KiwiSaver first home assistance details

NZ Herald 12 June 2010

Q&As: A way for couples on higher incomes to get KiwiSaver first home help
Man with terminal illness can probably withdraw all KiwiSaver money
KiwiSaver contributions holidays more flexible than reader realises
More thoughts on why house prices have outgrown rents
2 readers challenge the use of the term "Mum and Dad investors" - and we seek an alternative

Syndicated column 22 May 2010 - Confession time about retirement plans and goals

I'm going to commit sacrilege here. But it's not as if I haven't thought long and hard about it. So okay, deep breath, here we go: Contrary to what many will tell you, it's quite possible to be financially together and not have a detailed written plan on how to fund your retirement - or even a retirement savings goal.

NZ Herald 15 May 2010

Q&As: Why house prices must - at some point - come down further
Newly retired person loses out, for a year, on PIE tax
How a rising NZ Super age might affect KiwiSaver
Temporary workers in KiwiSaver at a disadvantage

NZ Herald article May 2010: Reasons for not being in KiwiSaver rarely make sense

NZ Herald 27 February 2010

Q&As: KiwiSaver trustee change raises questions about how much trustees protect members
Hazards of dealing with an overseas sharebroker
What's the difference between investing and gambling?

Syndicated column 30 January 2010 - Oh no, oh no, it's off to work we go

Returning to work after a holiday is rarely easy. Back when I was employed - as opposed to self employed - I remember always feeling as if I were in the wrong job on my first few days back at work.

NZ Herald 5 December 2009

Q&As: Adviser's advice is shocking - on three counts
Does it make sense to want your charity dollars to all go to the frontline?
When should you reduce your KiwiSaver contributions?

Syndicated column 1 December 2009 - Gifts that give on several levels

Perhaps the most important assignment in a university course I teach on financial literacy has little to do with finance. Worried that the course might send the message "the more money you have the better", I ask the students to think about how money and happiness are related.

NZ Herald 28 November 2009

A way to make friends and relatives happy at Christmas
Changes to invitation to Capital Market Taskforce meeting
Q&As: Less insurance can save big money and work well - if you are healthy and careful
Gradually get rid of preference shares you don't want any more

NZ Herald 10 October 2009

Q&As: A reader challenges my advice last week about postponing a first home purchase for three years
How to get around the income cap on the KiwiSaver first home subsidy
How to get around the three-year requirement for KiwiSaver first home assistance
Another reader challenges me - on my advice on whether to sell a Mangere Bridge house or a Whangamata house
The merits of coin tossing
Maybe Lotto will make reader's decision easier

Syndicated column 6 October 2009 - Good news goes unheralded

One of the findings in a recent survey caught my eye. Only 12 per cent of New Zealanders surveyed said the value of their financial investments had grown in the previous six months, with 42 per cent saying the value was unchanged and 46 per cent saying it had fallen. The vast majority got it wrong.

NZ Herald 19 September 2009

Q&As: Even a reader's accountant seems confused about how gains on share sales are taxed. The law needs to be changed.
Property fan who did badly in the share market broke one of the basic rules of share investing
Did I mislead readers about the advantages of dollar cost averaging?

NZ Herald 12 September 2009

Q&As: One reader loathes KiwiSaver, while the next one loves it. But both don't fully understand it.
A former hippie gets a bit carried away

NZ Herald 29 August 2009

Q&As: Just because a so-called financial expert is confident, that doesn't mean he or she is right
If you haven't worked for a while any time in the last five years, you may well be in for a tax refund
Don't delay joining KiwiSaver, even if you're worried that you could be made redundant
KiwiSaver tax credit lark for the newly retired is too good to be true

NZ Herald 22 August 2009

Q&As: Wealth doesn't have to equal filth - New Zealanders' attitude to money may leave them more worried about financial issues
Take your pick between share fund managers who try to outperform the market and those who don't
Members of work super schemes can do well by also being in KiwiSaver

NZ Herald 15 August 2009

Q&As: Reader explains why he won't invest in shares
Data suggest New Zealand doesn't actually over-invest in property
New Zealanders' lack of interest in shares hurts more than just individuals
Help is available for horseracing "addict"

Syndicated column 14 July 2009 - Recession could be a blessing for most

The response to a question in a recent survey bothered me a little. Asked what they would do with a $10,000 cash windfall, 54.3 per cent of the respondents said they would pay off debt or save the money - down from 58.3 per cent three months earlier.

It's not exactly a huge drop. But I was hoping for a substantial increase.

Syndicated column May 16 2009 - Ill wind not as bad as it seems

An email from a Christchurch reader has got me thinking. "In any game it is either a win, loss or a draw," he writes. "Right now there are plenty of losers, nationally and globally - individuals, institutions, banks, organizations, even one or two countries. So who are the winners?"

Syndicated column November 25 2008 - Christmas giving that makes you happier too

Struggling retailers aren't going to like this, but how about we make 2008 the year we stop spending ridiculous amounts on Christmas presents we don't need - and often don't even like?

NZ Herald November 22 2008

Q&As: Does charity begin in the home country? Salvation Army programme looks good.
List of overseas charities with Christmas gift offerings.
National's KiwiSaver changes could discourage single Mum trying to get ahead - but there's hope they will be altered.
The whole KiwiSaver mortgage diversion issue will be much easier for many under National's changes.
Plus: Readers on KiwiSaver

NZ Herald November 15 2008

Q&As: 2 Q&As on National's proposed changes to KiwiSaver
Plus: Meaningful Christmas presents
Readers' views on KiwiSaver

Syndicated column September 2 2007: Is saving always good?

In some circles, saving has a bad name. People think it's about deprivation - "I either save or I spend, and spending is more fun."

NZ Herald October 20 2007

THE OTHER B WORD

Budgeting is rather like eating healthily or exercising. Some people like to do it, but for others it's a chore. And for many it's a source of guilt. They think they should do it, but they don't.

This article could be yet another telling the laggards how they will be much better people if they keep track of all their spending. But that's hardly likely to make any more difference than other such articles.

As poet Robert Frost wrote: "Nobody was ever meant, to remember or invent, what he did with every...

NZ Herald September 29 2007

Over the next few weeks, this column will run highlights from Mary Holm's quarterly newsletter Holm Truths. Mary's regular Q&A column will resume on October 27.

STUFF AND HAPPINESS

A woman I know wasn't sure what to do. Should she renovate her current house, or move to a cheaper suburb and buy a house that was already up to the minute? She preferred to stay put, but would have to borrow to renovate and wasn't sure if she could afford to repay that debt.

NZ Herald May 12 2007

Q&As: Three readers defend baby boomers and suggest how today's young could afford to buy homes.
A Generation Xer speaks up for her generation.
A reader worries that apartments may lose value.

Holm Truths summer 06-07

The other B word: While some people find it easy to follow a budget, others struggle. Here are some tips for the latter group.
Also in this issue: From the Mailbox - Couple who sold their house save heaps by renting. But should they wait for a price fall before buying again?

Syndicated column December 2 2006: The investment games people play

Let's say you're playing a game in which everyone has been given $20. In each round, you choose whether or not to put in $1, and a coin is then tossed. If it's heads, you get back $2.50. If it's tails, you lose your $1.

How often would you put in a dollar?

NZ Herald September 9 2006

This week, and through September, we are running excerpts from Mary Holm's bestselling book, "Get Rich Slow: How to grow your wealth the safe and savvy way." Mary's regular Q&A column will resume in October.

HOW OUR EMOTIONS AFFECT OUR INVESTING

NZ Herald August 12 2006

Q&As: A few fewer luxuries and many New Zealanders could afford to buy homes.
2 Q&As on whether the Reserve Bank got it right with the new coins.
A financial planner objects to what I said last week about how to choose an adviser.

Syndicated column July 18 2006: Owning your home not always the best option

Most New Zealanders grow up expecting to own their own home, but soaring house prices have made it harder for people to get into the market. Does that matter? Is home ownership all it's cracked up to be?

NZ Herald July 15 2006

Q&As: Lessons from the Bible: Is borrowing bad?
Is luck or attitude the secret to wealth?
Sharebrokers shouldn't always be expected to give ongoing advice.

NZ Herald February 11 2006

Q&As: Couple should spend less?
Wealth isn't always money.
How last week's correspondent made his millions.
Making extra payments on fixed mortgages without penalties.

NZ Herald November 26 2005

Q&As: Woman in Australian shouldn't sell her house here.
Is the house price boom like the great tulip bulb bubble?
Couple disagree over rental property v shares.

Syndicated column November 1 2005: Borrowing tricky between family or friends

A quote recently caught my eye. "The easiest way to teach children the value of money is to borrow some from them," it said.

But that applies not only to children. Adults, it seems, take much more notice when someone has borrowed from them than when someone has lent to them.

Syndicated column July 12 2005: Complexity of financial products no accident

Confirmation, at last, of what we've suspected all along: Providers of financial products may deliberately make them sound complicated.

NZ Herald June 4 2005

Q&As: 2 on renting v home ownership - including the psychology of the choice.
The professor who set last week's question gives me a grade, and notes that house prices have fallen lots elsewhere.

NZ Herald May 7 2005

Q&As: A letter to give a spouse who is mean with money.
Where to get info on interest rates.
Returns on share funds, and debt repayment.

NZ Herald March 26 2005

Q&As: Man in mid 50s can afford to drop out - but what about emotionally?
Is reader silly to stick with renting?