How to turn $25 a week into a $26,000 investment plan

Thursday, 18 June 2026

Research found that advice from friends and colleagues is cited as an important source of information for 85% of investors under the age of 35, and 61% of these investors also said they were using social media as a source for investment information.

Financial progress is often blocked by the false belief that investing requires a massive starting lump sum.

To prevent the temptation of spending savings, investors should give their money specific meaning by labelling it for clear outcomes.

When starting small, it is crucial to minimise investment fees by using low-cost investment options.

Basic assumptions can often stand in the way of financial progress.

Assuming in your early 40s, for instance, you’ve left it too late to start investing could lead to your kids missing out on a decent education fund.

Similarly, assuming that you need a massive starting point contributes to the so-called planning fallacy, where we spend ages trying to think of how to attain a sizeable starting nest egg rather than just building one from the ground up. This is a bit like the friend who convinces himself he needs a $2000 road bike to start riding casually.

These simple niggling assumptions can afflict even the steeliest minds, stopping them from making good long-term decisions early in life. You need only reflect on your life to find moments where the wrong assumption (or perhaps the wrong piece of advice) has led to you choosing the wrong course of action.

Tanaz Jadine, a financial adviser at Stuart Carlyon, has spent 30 years helping clients build wealth and tells me it’s painfully common to see her clients assume they need a large amount of money to get started.

Tanaz Jadine is an experienced financial adviser at Stuart Carlyon.

“Even small amounts like $25 a week or $50 a month can make a difference,” she says.

“The real question is not how much you start with, but whether you can do it regularly and build a habit that lasts.”

Jadine recommends taking quite a deliberate approach when it comes to doing this.

A good starting point is paying your future self first, she says.

It might sound odd, but this is about setting aside money before spending it elsewhere.

“That starts with a basic budget: understanding your fixed costs, your discretionary spending, and what’s left over. Once you can see that clearly, even a small surplus can be directed towards savings.”

Give the money meaning

Simply putting money away might not be enough to stop the temptation of spending. If you have a pot of money available, it’s always easy for your brain to find justifications to spend it.

To overcome this flaw in our thinking, financial adviser Zara Malcolm says it helps to define what the money is actually designed for.

“That’s what gives it meaning,” Malcolm says.

“It makes it feel less like you’re just investing into the void and more like there’s a real outcome you’re working towards.”

It’s far more difficult to raid your child’s university fund, your Turkish hair transplant nest egg or your cat’s emergency vet fund than it is to just spend money you happen to be saving.

Another helpful trick Malcolm recommends is automating your savings.

“That’s usually where things fall apart. Set it up so it just runs, then each month take a quick look and see if you can increase it slightly, even just small percentage bumps. If you treat it a bit like a game you’re trying to level up, it tends to stick better.”

Most Kiwis would be surprised to see how quickly even a small savings habit can accumulate when consistent deposits are made and left to compound.

Hypothetically, if you had invested $25 per week into the S&P 500 for your child’s university fund from the date of their birth, it would be worth $11,850 if they were turning six this month or $26,100 if they were turning 10.

Now imagine that being allowed to continue to grow and compound until the child was 18. It’s the type of headstart that would negate the need to rely on huge student loans.

Watch the fees

Robyn Conway, the general manager of managed funds at Fisher Funds, says it’s critical to keep an eye on fees, which vary by investment type.

Robyn Conway says fees are an important thing to consider when it comes to investing.

“Managed funds typically charge management or admin fees, while share trading platforms often charge per transaction,” she says.

“These can add up, especially with smaller, frequent investments, so it pays to understand the fee structure and adjust your contribution frequency if needed.”

One way to do this is by leaning into passive investments (like index funds), which are generally lower-cost than active funds. You can access these through a number of different platforms, and you can quite easily compare the cost of investing in something like the S&P 500, depending on which provider you choose.

The key, however, is to understand the level of risk you’re willing to take. There’s always risk when it comes to money. The market could go up, but could just as easily go down, so you need to define the purpose of this money as early as possible.

“The key is to match the investment approach with the timeframe,” says Jadine, explaining that you will need to avoid risk if you want to use the money in the shorter term.

“Some funds do not need a minimum investment, so if your timeframe is longer than five years, then your money can be drip-fed into these directly.”

The importance of investing rather than just saving lies in the need to outpace inflation over the longer term. Term deposits do offer a lower risk, but the returns are often lower than what you’d get in the equities market. As always, the right decision for you will depend on when you’ll need the money, how much risk you’re willing to take and whether you can stomach a period of downturn.

The worst mistake you can make, however, is waiting for that perfect time to start. It will never arrive, and you may be left ruing the years you could have spent investing just a little at a time.

So what investing advice do you have for young people starting out today? And what incorrect assumptions did you have earlier in life that you wish you could have course-corrected earlier? Let us know in the comments section below.