The biggest financial risk is losing your income. Photo / 123rf
It can happen to anyone, says Kerr, who lost his job suddenly in 2013 thanks to a decision by his employer, Credit Suisse, on the other side of the world, that left the entire Australasian team out of work.
“As someone who spent a very long time unemployed, it really did teach me a valuable lesson about having at least three months of earnings.”
It’s a timely reminder. August is Sorted Money Month, which is focusing on emergency funds.
Scams are the next thing on Matthews’ list. According to Payments NZ, New Zealanders lost $265 million to bank scams in the year to October 2025.
It can happen to anyone, Matthews says, citing tech-savvy commentator Russell Brown, who was busy when an English-accented scammer caught him unawares and he gave away access to his own and his mother’s accounts in one fell swoop.
“It’s that lack of attention. Because let’s face it, we’ve all got busy lives,” Matthews said.
High on my list is inflation, which is a silent killer of our finances. It hurts on a day-to-day basis, says Kerr, especially for low-income earners. People with fixed-interest investments see them eaten away as well.
Inflation meant people had gone from being able to afford a house to being able to afford only a car. Photo / 123rf
Kerr remembers an inflation lecture at university by former Reserve Bank Governor Don Brash, who explained to Kerr and his fellow students that $50,000 deposited in the 1960s might have grown to $70,000 by the 1980s, but inflation meant they had gone from being able to afford a house to being able to afford only a car.
Then there are the risks to the money you’ve actually managed to save or invest. You can’t ring up an insurer and buy a policy against a stock market crash. The danger is switching to conservative investments at the bottom, which locks in paper losses permanently.
Similarly, simply failing to keep on top of basic financial choices is a hidden risk, says Matthews. That might be leaving savings in a low-interest account or choosing the wrong KiwiSaver account.
Finally, policy risk is a massive, uninsurable threat that flies under most people’s radar. Stroke-of-a-pen decisions made in Wellington can shift your financial foundation overnight, and no insurance policy will reimburse you for a change in government settings.
Whether it’s moving the goalposts around KiwiSaver, or NZ Super, or tweaking the bright-line test on property investments, political decisions carry huge financial consequences. You can do everything right according to today’s rules, only to find the tax or regulatory environment has completely reshaped your retirement plan 10 years down the track.
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