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Speaker 1: You're listening to the Saturday Morning with Jack team podcast

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Speaker 1: from News Talks'd.

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Speaker 2: Be fourteen to eleven. Need McKnight from Opie's Partners is

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Speaker 2: here talking money killed her. Great to be here, Jack, Oh,

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Speaker 2: great to be speaking with you. My goodness, what a

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Speaker 2: week of turmoil for the global It's sort of hard

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Speaker 2: to keep up with everything at the moment. So I

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Speaker 2: don't think the tariffs have changed overnight, which makes well

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Speaker 2: a nice change if you like a little bit of stability.

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Speaker 2: But we wanted to talk to you about some of

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Speaker 2: the impacts for everyday Kiwi. So let's start off with

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Speaker 2: the impact on Kiwi savers this week, because there has

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Speaker 2: been a bit of movement.

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Speaker 3: There has been huge movements, so the American stock market,

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Speaker 3: the S and P five hundred that went down ten

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Speaker 3: percent within around about two days, that's recovered a little bit,

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Speaker 3: recovering about half of those losses. But look, I logged

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Speaker 3: into m Kiwi saver asp portal just before I picked

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Speaker 3: up the phone to here Jack. I'm personally down six

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Speaker 3: and a half k over the last seriousy days. Though

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Speaker 3: I know some Keiwi's, especially those who are closer to retirement,

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Speaker 3: are going to be logging in and seeing even bigger

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Speaker 3: losses on that. Thankfully not too many changes overnight, but

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Speaker 3: there's I've been thinking a lot about first home buyers

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Speaker 3: and retirees, people who are quite close to needing to

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Speaker 3: use that money. You know, the thing we often say

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Speaker 3: to younger people is if you've got a really long

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Speaker 3: time horison, if you're twenty five now and you're not

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Speaker 3: going to retire till sixty five, maybe you'd typically put

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Speaker 3: your Keiwi saver in a growth fund or an aggressive fund,

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Speaker 3: something that's got a lot of exposure to shares. And

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Speaker 3: so if that's you, you probably have seen some quite

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Speaker 3: large drops. But what this has got to be thinking

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Speaker 3: about as well, if you're twenty five, is your time

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Speaker 3: horizon really forty years? Are you really not going to

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Speaker 3: touch that Kiwi saver until you're sixty five or are

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Speaker 3: you going to need it be a house deposit next year. Well,

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Speaker 3: if you're going to need it for your house deposit

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Speaker 3: next year, hopefully you weren't in a growth fund because

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Speaker 3: you really needed that money in a year or two years,

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Speaker 3: maybe five years. And if you were about to pull

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Speaker 3: out that key we saveor to buy it as a

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Speaker 3: deposit for your first home. Well, you really hope that

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Speaker 3: it hasn't dropped, you know, five K or six k,

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Speaker 3: because when you are buying that first home, every last

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Speaker 3: dollar really does count. And I've also been thinking about

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Speaker 3: those retirees. Hopefully those people are who are sixty three

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Speaker 3: and aren't going to be using that key we savor

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Speaker 3: very very shortly. Hopefully they are in the right fund

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Speaker 3: for them as well. Now you could be sixty three

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Speaker 3: and maybe you've got some other savings stashed OUTSPA and

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Speaker 3: you're not going to touch that key. We save it

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Speaker 3: to seventeen. Maybe then it's still okay to be at

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Speaker 3: a growth fund have a lot of shares in there.

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Speaker 3: But I think it's a really good wake up call

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Speaker 3: for Keiw's not to be too pollyannerous, sure, not to

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Speaker 3: be too optimistic in terms of the fund. Yes, shares

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Speaker 3: do tend to make more money over time, but if

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Speaker 3: you are going to pull out that money within the

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Speaker 3: next couple of years, just think very carefully about what

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Speaker 3: sort of funds that money that money has invested in.

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Speaker 2: Yeah, I hur reckon. There's always a good argument. Well

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Speaker 2: it depends where you are, like you say, but there's

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Speaker 2: often a good argument for structuring a bit of a split. Right,

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Speaker 2: so you have some of your key we savers say

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Speaker 2: in a more conservative fund, you have some in a

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Speaker 2: mixed fund, you have some in an aggressive fund. I mean,

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Speaker 2: if you like me and you've got a few decades

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Speaker 2: until you're going to be retiring, then sure chuck it

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Speaker 2: all into a more aggressive fund. That makes sense. But

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Speaker 2: having a structured fund often makes makes sense. And like

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Speaker 2: you say, you know what a wake up call. And

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Speaker 2: let's be honest, even if, even if these tariffs are

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Speaker 2: all canceled tomorrow, the nature of Donald Trump's leadership is

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Speaker 2: that there's likely to be some volatility over the next

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Speaker 2: couple of years as well. Well, what do you think

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Speaker 2: this is going to mean for interest rates?

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Speaker 3: Well, according to the Reserve Bank, they reckon that the

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Speaker 3: interest rates could have to come down faster. And it's

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Speaker 3: quite strange because often when we think about tariffs, we

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Speaker 3: think it's going to cause more inflation. And the more inflation,

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Speaker 3: the faster that prices go up, typically to see interest

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Speaker 3: rates increase, and certainly you'd likely see some inflation in

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Speaker 3: the US. But here's the thing. We sell a lot

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Speaker 3: of our stuff, a lot of our sports over to China. Now,

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Speaker 3: if China gets really hit by these tariffs and Chinese

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Speaker 3: businesses aren't going so well, the Chinese economy isn't going

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Speaker 3: so well. Well, they've got less money to buy our stuff.

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Speaker 3: And if we can't sell as much of our stuff

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Speaker 3: over to China or some of our other trading partners,

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Speaker 3: then our economy is going to slow down a bit. Now,

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Speaker 3: there's so many arguments for why this could cause inflation

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Speaker 3: here in New Zealand, but there are also a lot

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Speaker 3: of arguments for why it could bring our inflation down

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Speaker 3: and therefore our interest rates down. Looking at what the

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Speaker 3: Reserve Bank is saying are saying on the balance of it,

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Speaker 3: we think this is actually going to be bring our

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Speaker 3: inflation rates slightly down. That means that interest rates may

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Speaker 3: need to fall, and we're actually seeing that in the market.

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Speaker 3: So if I look at what it costs a bank

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Speaker 3: to borrow money and lend it out to you and

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Speaker 3: me for our mortgages, you know, those wholesale rates are

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Speaker 3: down about zero point two five percent over the last

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Speaker 3: week or so. They're pretty volatile as you'd expect, but

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Speaker 3: I am seeing a slight weakness and infrastrates interest rates

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Speaker 3: coming down slightly because of this spart. It is very revolve,

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Speaker 3: so we'll see what happens tomorrow.

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Speaker 2: It's a funny old time to be alive. Ed, it's

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Speaker 2: a funny old time to be alive. I mean, never

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Speaker 2: a dull day. I think we can all agree on

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Speaker 2: that at the very least. But thank you so much.

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Speaker 2: We really really appreciate that, and we'll catch you in soon.

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Speaker 1: Check for more from Saturday Morning with Jack Tame. Listen

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