Friday, June 30, 2006

Deposits and Mortgages are not saving!

A few weeks back there was some feel good research published by the Westpac bank that purported to show that Aucklander's saving habits weren't as grim as thought.

In particular when this was reported by the MSM emphasis was placed on:
The independently conducted research shows that nearly half of Auckland savers claim to save regularly, with just under half aiming to increase their contributions to their nest eggs in the future. On average, the sample group were saving nearly 22% of their monthly income, but would ideally like to make this 32%.

Typically, more than a third of savers (35%) were salting away more money now than they were a year ago. What’s more, nearly 50% plan to increase their savings contributions over the next three months, compared with just 21% who plan to save less.

And from there the feel good wrapper was made.  However what really needed to be focused on was the target of these "savings": 18 – 35 saving mostly for mortgages and deposits, and the 55+ cohort for retirement.
First - it is disturbing that the main group saving for retirement was the 55+ age group, if this is when you start saving for your retirement you have big problems.  In fact whatever you salt away in the last 5 years or so of work is really going to have no appreciable effect on your retirement standard of living.
Secondly - and potentially more importantly - is the point that saving for a mortgage or deposit on a TV is not really "saving" in respects to the type of saving that New Zealand needs, it is avoiding a Hire Purchase Agreement.  While this is to be lauded - it is frequently better for us to delay buying something until we can actually afford it - it is not saving in terms of building wealth, and building the wealth store of the country.

That involves "saving" without a purpose - it involves building up your personal reserves without a spending target in goal, improving your asset and earning base.  The mind set that "saving" is something you do until you spend it is a major factor in New Zealand's continuing decline in OECD living standard comparisons, because we are never building our wealth on a permanent basis.  We may temporarily save - but only until we hit some benchmark that we can now buy that TeleVision / House / Holiday.  As a society we need to divorce our thinking that saving for the purpose of spending is a good start - but definitely not the end goal.

What proportion of your income do you actually save?  And what do you put away to buy things?
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Thursday, June 29, 2006

A new currently favourite author

Been in Melbourne for the first part of this week - which I will try and use as an excuse for my week-daily blogging dropping off (even though it has been a problem for a fraction longer than that...)
But despite this being a business based trip and therefore seeing very little of the city to which I was visiting there was one definite upside to the trip - I now have a new prodigious author that I can concentrate on devouring for a while.

The claim that he is a new favorite I suppose is a fraction strong - it will take a while before I would actually give anyone pride of place above Frank Herbert, Isaac Asimov and Dennis Wheatley; but having finished all of their works there is the issue that they cannot be my favorite author in terms of current reading.  It looks like Iain M. Banks with "The Algebraist" might have made himself that new author. 

When you can sit for two whole 4 hour flights reading non-stop both times you know someone has captured your imagination.  At the very least I would recommend this book to any one who passably likes Sci.Fi; and I'm sure I'll be able to update you on his other books soon ;-)
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So when is Maori not Maori?

Apparently whenever it comes to pointing out that their culture is currently also made up of patricide and welfare dependency.

In the wake of the (yet another) dead child tragedy the response of the (publicly vocal) Maori community has somewhat interested me.  It is always somewhat strange that Maori are fully willing to accept "responsibility" for the outcomes of their culture when it comes to the acceptance of more money.  Whether that be through targeted welfare, targeted scholarships, cultural donations etc.  And oddly enough even when that money is specifically being targeted because of Maori's over representation in crime and poverty statistics.  In fact the number of public outcries from Maori interest groups that more money needs to be poured into the Maori community to 'solve' these issues (and atone for past crimes against the Maori culture) tend to be unceasing.

And yet when a specific instance of how the current Maori culture is self-destructing itself is brought up in the media the calls from these same groups is that this is nothing to do with their being Maori, and this is a general societal problem that we must come together as a community to solve.

I just wonder whether they recognise their own hypocrisy in claiming that these issues are Maori specific and therefore they need more money to solve them (otherwise it would need to be spent on society not Maori) - but that the specific instances are nothing to do with being Maori at all?
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