The Easiest Way to Grow Your Wealth
You don't need to pick stocks. You don't need to understand charts. Here's how to start investing — even if you know nothing about the stock market.
Step 1: Understand Why Everyone Says “Buy the S&P 500”
If you ask any money blogger, financial educator, or legendary investor (Warren Buffett included) what the easiest way to invest is, most will give you the same answer: buy an S&P 500 index fund.
The S&P 500 is an index of the 500 largest companies in the United States — Apple, Microsoft, Amazon, Google, and so on. It has a track record of roughly 90+ years with an average annual return of around 10% before inflation (approximately 7% after inflation).
Why It Works: Self-Cleaning
The index automatically removes underperforming companies and replaces them with the most profitable, fastest-growing ones. You don't need to pick winners — the index does it for you by following the latest economic trends and technological developments.
Why It Works: US Market Strength
These are all US companies operating in the world's largest, most developed, and most transparent economy. The US has the strongest capital markets, rule of law, and democratic governance protecting investors — it's not a coincidence that the world's most valuable companies are listed there.
Bottom line:If you invested $10,000 in the S&P 500 thirty years ago and did absolutely nothing, it would be worth roughly $200,000+ today. No stock picking, no timing the market, no stress. Just time.
Step 2: Why Buying US Stocks Directly from NZ Is Painful
So if the S&P 500 is the answer, why not just buy it directly? Because investing in foreign stocks from New Zealand comes with two expensive problems:
Problem 1: Tax Is Complicated
NZ IRD treats New Zealand and Australian shares differently from foreign shares. If you hold foreign shares (including US stocks) and you're a frequent trader, they're taxed under a different method (the FIF — Foreign Investment Fund rules). This means:
- You may be taxed on unrealised gains (gains on paper, even if you haven't sold)
- You need to track and report your foreign investments separately
- The calculations are complex enough that many people need an accountant
Problem 2: Currency Conversion & Platform Fees
If you use a platform like Sharesies to buy US stocks, you need to convert your NZD to USD. This means:
- Exchange rate spread: you lose money on the bid-ask spread every time you convert currency (both buying in and selling out)
- Platform fees: different fees for NZ shares vs US shares
- Trading fees: additional per-trade costs that eat into small, regular investments
Step 3: The Smart Shortcut — NZ Managed Index Funds
Instead of buying US stocks directly, use a NZ-based managed fund that invests in index funds (like the S&P 500) on your behalf. Choose one with the lowest management fee possible.
This is the approach we recommend for most New Zealanders. Here's why:
Auto-Invest: Set and Forget
Most NZ fund providers offer an automatic investment function. You set up a regular payment (e.g. $200/month) and the money is automatically invested into your chosen fund. No logging in, no deciding when to buy, no forgetting. Automation is the single most important factor in building wealth — it removes emotion and procrastination from the equation.
Tax Is Handled for You (PIE Funds)
Most NZ managed funds are structured as PIE funds (Portfolio Investment Entity). This means the fund handles all your tax automatically — no FIF calculations, no separate tax return, no accountant needed. Your tax is deducted at your PIR (Prescribed Investor Rate) before you receive your returns. It's completely hands-off.
Our Recommended Providers
These providers offer S&P 500 / global index funds with the lowest fees in NZ:
| Provider | Management Fee | S&P 500 / Global Fund | Auto-Invest | PIE Fund |
|---|---|---|---|---|
| Kernel | 0.25% | S&P 500, Global 100 | Yes | Yes |
| Simplicity | 0.10% – 0.31% | Growth Fund (global equities) | Yes | Yes |
| InvestNow | No platform fee (fund fees vary) | Access to 180+ funds | Yes | Varies by fund |
How It All Fits Together
| Approach | Fees | Tax | Effort |
|---|---|---|---|
| Buy US stocks directly (e.g. Sharesies) | FX spread + platform + trading fees | FIF rules — complex, may need accountant | High — manual buying, tax filing |
| NZ managed index fund (Kernel / Simplicity) | 0.10% – 0.25% p.a. only | PIE — automatic, no extra filing | Minimal — auto-invest, set and forget |
How to Get Started in 10 Minutes
- 1Sign up with Kernel or Simplicity (both have simple online sign-up)
- 2Choose an S&P 500 or global index fund
- 3Set up an automatic investment — even $50/month is a great start
- 4Don't touch it. Let compound interest and time do the work. Check back in 10 years.
Disclaimer: The information on this page is general in nature and does not constitute financial advice. Investing involves risk — you may lose some or all of your investment. Past performance is not a reliable indicator of future returns. Consider seeking advice from a licensed financial adviser before making investment decisions. Last updated: January 2026.