Book Review: Cracking Open the Nest Egg
19 Jun, 2022
I’ll try to make this short and sweet for you!
Via my emails to subscribers and random Kiwis who seek me out, I’m constantly recommending blogs, podcasts, books, websites, products and people. Any tool or resource that I think will be educational and beneficial to the person I’m trying to help.
The weather turned cold here last week, a perfect time to read one of the many personal finance books I have on my ‘need to read’ list. Reading the latest book by Martin Hawes coincided with people mentioning the book in emails to me, and a podcast I have just recorded where I detail how a fabulous 66-year-old wahine called Zoe has used a concept taken from this book to help her navigate her retirement finances.
Hearing good things meant it rose to the top of my reading pile.
I’ve met Mr Martin Hawes, and I had the pleasure of having a cuppa with him when he called in at my whare in Alexandra a few years back. It was a huge highlight to have the chance to kōrero with him because one of his previous books, Twenty Good Summers, helped set Jonny and myself on the path we are still on today.
I’m 48 years old and as I grew up, if the 6pm TV news, radio, newspaper, or magazine needed a point of view on anything money, particularly if it was personal finance related, he was the go-to guy, a Financial Advisor with his finger on the pulse.
He was always level-headed, never spruiking a product (or if he was, he was absolutely upfront about it), and continuously well researched. He exuded authenticity, a prized feature of an expert, then or now.
Although I admit to nodding off a few times mid-read, I still highly recommend this book. Personal finance books rarely build suspense, which keeps me awake, but there was a mic drop at the end when Martin revealed that he uses a financial advisor himself these days. Say what!
Martin was a financial advisor for many years but no longer is, having recently cancelled his licence in an effort to retire himself, and he now refers to himself as a financial author and speaker. His latest book, “Cracking Open the Nest Egg - How to make your retirement savings last the distance” (Upstart Press 2021), is a welcome and useful tool for those near or already in retirement.
There are many resources for those growing their wealth, but this book (his 23rd!) fills in the next phase for you: how to spend and enjoy your money. It is not aimed at early retirees but at those who are retiring at 65.
“The fear of loss is much stronger than the hope of profit, and, quite rightly, that fear of loss grows as we age”, which makes spending the nest egg you have spent many years creating a psychologically hard ask.
Given that many struggle to make a plan for their money month to month during their earning years, it’s a daunting task to plan your money to last you 25+ years in retirement, especially once you give up working, so this book walks through ways to help you save and invest while you near retirement, while you are retired, and then answers the questions you might have about how to actually start to spend your nest egg, both the returns and the capital, once you decide to.
Apparently, on average, we will spend about 25 years in retirement (if we retire at 65) and for most retirees, receiving NZ super from the age of 65 forms the basis of their financial plan. Although I think we assume that older people have this “money thing” all sorted out, I know that is not the case for many. This is why this book is so important. It’s current, relevant, comprehensive, and a New Zealand resource that will help you develop a plan. In the absence of anyone else to talk to about how to handle money in retirement, this book is an excellent place to start for many.
There are two sections:
Section 1 - Planning for your best retirement
Chapter 1: What’s the Plan?
Chapter 2: Spending in Retirement
Chapter 3: Making your Money Last as Long as you do
Chapter 4: Your Drawdown Rate
Chapter 5: Other Sources of income
Chapter 6: The House
Section 2 - How to Invest in Retirement
Chapter 7: The Science of Investing in Retirement
Chapter 8: Asset Classes and Risk Management
Chapter 9: Investing and Getting Help
Particularly timely at the moment, Zoe, who I mentioned above, gave me a glimpse into the fact that she had been steaming towards retirement with no financial plan other than joining KiwiSaver. She remedied that by getting some qualified financial advice (something Martin Hawes very much recommends), which produced a workable financial plan. When this book came along, she read it and pulled some key points from it that she’s now applying to her situation. The main one was the concept of having a “lake of cash”, a sum of money in the bank to use when the share market is down, and you don’t want to sell investments.
The fact that Zoe has been able to apply the contents of this book practically would, I am sure, make Martin smile.
Although I am firmly in the DIY investment camp at this stage of my life, I can appreciate that for those who are uncertain, seeking a professional to help you navigate your retirement may be worth the expense. It was good to read this book, then have a long chat with Zoe and see how she has combined the education she sought out by herself, plus the advice of a financial advisor.
The book didn’t convince me that at my stage of life, I need to do the same. But, never say never, I guess!
At any stage of our financial journey, there is no one size fits all approach to managing pūtea, but there are common themes. Personal finance in retirement is just the next chapter in your financial life and one that you can prepare for with a bit of knowledge and a plan. This book offers options galore, all sorts of things to think about that you might never have thought about before but that you could use so that your money lasts as long as you do.
I’d go so far as to say that this book should be “required reading” for future retirees. It will make your eyes glaze over in places, but it covers so much ground that you will pull out some nuggets of wisdom to apply to your situation, making it valuable and relevant to all retiring Kiwis.
Martin has kindly donated a copy for me to give away. If you would like to go into the draw, please fill in the form below. We will draw the winner on the 3rd of July. You are, of course, also welcome to borrow my copy if you want to read it, just get in touch.
Happy Saving!
Ruth
BOOK GIVEAWAY: Cracking Open the Nest Egg
The BOOK GIVEAWAY of Cracking Open the Nest Egg by Martin Hawes was a great success and congratulations to our winner who won a copy of the book. Thank you to everyone who entered.
If you would like to purchase a copy, please consider using one of my affiliate links: Mighty Ape, Paper Plus, Booktopia, Apple Books
