Every Student an Investor

Too many young New Zealanders leave school without knowing how wealth is created, how capital grows or how businesses make money. Most people’s first contact with investing is a KiwiSaver account they were automatically enrolled in and never looked at again.

That matters. New Zealand has too much of its wealth tied up in housing and too little in productive businesses. Productivity has been flat for nearly two decades, wages haven’t kept up, and young people watch home ownership move further out of reach, sometimes as far away as Australia.

ACT will give every Year 11 student $500 of real money to invest over the school year. Students will learn by doing, with skin in the game, and those whose families have never invested will benefit the most.

ACT will:

• Give every Year 11 student $500 in a controlled investment account, run through approved platforms with appropriate safeguards and curriculum support.

• Have students work up through four levels during the year, moving to the next level only after passing a knowledge test:

  Term one: a term deposit, to learn how saving lets others use capital productively and earns a return.

  Term two: a managed fund, to learn about risk and how it depends on what a fund holds.

  Term three: New Zealand shares, to learn how companies work: what they sell, what they cost to run, and who runs them.

  Term four: international assets, to learn about exchange rates and the opportunities and risks beyond our shores.

• Let students keep any gains above $500 as cash at the end of the year, with the original $500 transferred into their KiwiSaver.

• Fund the programme by redirecting around $30 million a year, about five per cent of the roughly $600 million annual KiwiSaver government subsidy.

In our team's words:

ACT Leader David Seymour says:

“Every fifth former, or year 11 if you’re under 40, is given $500 in a controlled investment account, with a structured pathway into real investing. This would not be abstract theory, students would have skin in the game.

“Children whose parents already invest may have a head start, but those who don’t will benefit the most. If you are an investor, even in a small way, you stop seeing yourself as a passenger in the global economy and start seeing yourself as someone who can take the wheel.”