Kiwi Investors Prioritize Assets Over Salary Amid Economic Challenges

Highlights:

• Investment Over Salary: 76% of respondents continued investing despite financial strains, and 51% view the stock market as the most accessible way to build wealth.
• Income Challenges: Nearly two-thirds believe they need to earn over $100,000 to live comfortably, with 44% expecting only a 1-5% salary increase in the next year.
• Intergenerational Wealth Gap: 60% of respondents feel the wealth gap hinders young people, driving younger generations to cut spending and invest to improve their financial situation.

As wages lag behind the rising cost of living, New Zealand investors are turning to financial markets for wealth building, according to a report by Australian investment platform Stake.

Shifting Financial Strategies

The Stake Ambition Report, surveying over 1,000 non-retired Kiwis, reveals that traditional routes to financial security, such as securing a 'good job' and buying property, are now viewed as less reliable. Factors like goods inflation, housing costs, and slow wage growth are the primary barriers.

Income and Investment Trends

The report shows that nearly two-thirds of respondents believe they need to earn over $100,000 to live comfortably. Despite financial strains, 76% continued to invest over the past six months, with 67% maintaining their shareholdings.

Preference for Stocks Over Property

Respondents favored the stock market (51%) as a more accessible wealth-building tool compared to property (11%). However, 73% would invest in property if possible. The main financial goals include retiring off investments (56%), boosting income (53%), and reducing work hours (32%).

Addressing the Wealth Gap

The survey highlights concerns about the growing intergenerational wealth gap, with 60% of respondents believing it hinders young people. Younger generations are cutting discretionary spending to invest, showing significant ambition.

Stake CEO Jon Howie notes that despite economic challenges, 80% of investors remain confident in their financial future, focusing on proactive investment strategies. The survey also found that most financial knowledge is gained from personal networks and self-directed learning, rather than formal education.

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