FinancialIndependenceHow much is enough?

Disclaimer• The information provided in this presentation is of a general nature. To the extent that any

information in this presentation constitutes advice, it is class advice only, and is not personalised to take into account an individual’s particular financial situation or goals.

• You should not make an investment decision based solely on the information in this presentation. To obtain advice that takes into account your particular financial situation or goals, please contact one of our financial advisers.

• Whilst every care has been taken in the preparation of this presentation, Spicers makes no representation or warranty as to the accuracy or completeness of the information.

• None of Spicers, any of its employees or agents, or any other party, guarantees the performance of any of the investments mentioned in this presentation, gives any warranty of reliability or accuracy, or accepts any responsibility arising in any way from any error or omission.

• Past performance is not an indication of future performance and is not guaranteed by any party.

• The future behaviour of investment markets is uncertain and calculations or projections are estimates of possible results given certain assumptions, today's knowledge, market conditions and outlook. These calculations should be regarded as estimates and illustrations only. Investment performance and attaining investment objectives are not guaranteed".

• Spicers is paid by charging fees for its advisory services. 

• A disclosure statement is available on request and free of charge from your Spicers adviser.

Spicers Portfolio Management Limited Leve 4, 32-34 Mahuhu Crescent, AucklandTelephone: 09 347 1442

The BehaviouralDrivers

Financially Independent

• High levels of debt

• Lack of a savings culture

• Financial literacy

• Overly reliant on housing

• Welfare mentality

Why so few?

“Having sufficient financial resources to provide you with the choice to do what you

want to do”.

How much is enough?

NZ population over age 65

* Statistics NZ. Demographics Aspects of New Zealand’s Aging Population March 2006.

Life Expectancy at Age 65

Years to live

Year Male Female

1965 12.6 15.8

1980 13.3 17.1

1995 15.5 19.0

2005 18.0 20.6

2012 * 20.6 23.2

* Statistics NZ. Period Life Tables 2005 -2007

Not a great savings record Income and spending : Year ended March 1999-2011

Source: Statistics NZ 2011.

How much?

Source: Spicers Portfolio Management

Sum required to generate an income

*20 years at 2.0% “real” tax & 2% inflation

Tax paid income Lump sum*

$ 40,000 $ 654,000

$ 50,000 $ 817,500

$ 60,000 $ 981,000

$ 70,000 $ 1,144,500

*20 years at 2.0% “real” tax & 2% inflation.

Why Bother?

• It’s too complicated

• There’s no spare cash

• You’ll be right

• I ‘ll muddle along on my own – can’t trust anyone else these days

• It’s unachievable

• What’s the point – everything changes so quickly

Why Me?• Qualified

• Experience

• Passion

• Successes

• Ethics

Steps to do this:

• Clarify your needs & objectives

• Risk assessment and advice

• Comprehensive financial planning & advice

• Monitor and manage your progress

• On-going professional advice

To become financially independent

Solutions for financial independence?

Investor’s appetite for risk will vary……and risk vs. long term return need to be balanced against investment objectives

Higher returns come with higher price variability

Income

GrowthIncreasing

Return

Increasing Price Variation

Cash

Bonds

Property

Shares

Diversificationis a key ingredient in achieving investment objectives

The above is illustrative only and may not represent a particular Spicers portfolio. The above asset allocations are an example only and not a recommendation to invest in these proportions for any given investor.

Key Messages• Start your planning early

• Understand your spending & saving

• Don’t rely on NZ Superannuation

• Professional advice is available