Once you’ve agreed your investment strategy, your adviser can help you choose the most suitable investments or you can do it yourself.
Choosing your own investments
You can buy and sell investment products independently or use a platform (also known as a ‘nominee service’ or ‘wrap’) that lets you have all your investments in one place. These platforms give access to a wide range of managed funds, fixed interest investments and NZX listed shares. To find out more about platforms, see below.
Working with your adviser
Your adviser can recommend changes to your portfolio and get you to sign off each time, or they can provide a discretionary investment management service, called a DIMS. With a DIMS, your adviser manages the day-to-day management of your investments on your behalf. Your adviser needs to be acting under a licence or have the authorisation to provide a DIMS. Your adviser will take you through the relevant paperwork needed to sign up to a DIMS.
Before you sign anything ask
Will my investments be held in my name or someone else’s?
Who will hold my investments and ensure they are where they should be?
What information will I receive about my investments and how often?
What are the charges for this service?
Investing through a platform
Investment platforms are online services that can be used by you directly or by your financial adviser.
Your investment information is held in one place and you usually receive consolidated reporting – making it easier for you to track the performance of your investments. You may also have access to some funds not available individually.
Be aware, if you’re only investing in one or two funds, it can be more expensive to use a platform. You should also check it isn’t only available to clients of a particular advice firm. If it is and you change advisers, you may have to leave the platform and pay fees and taxes.
Keep a close eye on your money
Letting someone else make investment decisions for you doesn’t mean you should lose control. Most advisers behave professionally and are legally obliged to do the best for their clients, but it’s still important to keep informed about your investments.
Help protect yourself by
asking as many questions you like until you’re confident you understand what you’re investing in
never write a cheque payable to your adviser, unless you’re paying their advice fee
never sign a blank document given to you by an adviser, or a blank cheque keeping all your correspondence, statements and reports in one place – track your money and always check for anything unexpected
making sure any statements and reports about your investments are sent to you and not just to your financial adviser
finding out how you can cash in your investments. Check if conditions apply to withdraw money, such as reaching a certain age (for all KiwiSaver schemes) or waiting a set period of time (for some managed funds).