In this episode of Money Made Simple, Jennie and Liv unpack one of the most powerful, and not always well understood, ideas in personal finance -  compounding returns.

They explain how money can make money itself over time, why the “snowball effect” is such a game-changer for long-term savings and investing, and how it can work not just for you, but also against you when it comes to debt. Using simple, relatable examples, they show why starting early really matters.

This episode covers:

• What compounding actually means (in plain English)
• The difference between compounding interest and compounding returns
• Why time matters more than trying to perfectly time the market
• A powerful example showing how starting earlier can beat investing more later
• How compounding works in KiwiSaver, managed funds and shares
• The flip side: how compounding can quietly grow credit card, loan and mortgage debt
• Small, practical ways to make compounding work harder for you

Helpful money resources:

If this episode got you thinking and you want to learn more, these NZ based resources are a great place to start:

Sorted NZ – Free tools, guides and calculators to help with budgeting, KiwiSaver and retirement planning

MoneyHub NZ – Independent guides and comparisons on banking, investing, KiwiSaver and more

MoneyTalks (Free Financial Mentoring) – Confidential, non-judgemental help if you’re struggling with debt or bills


Whether you’re just getting started or need a refresher, this episode shows how tiny actions today can have a big impact on your future. Because when it comes to compounding, the best time to start was yesterday - and the second best time is today.

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Disclaimer: This podcast contains personal opinions and is intended to provide educational information only. It doesn't relate to your particular financial situation or goals and is not financial advice or recommendations. Simplicity New Zealand Limited is the issuer of the Simplicity KiwiSaver scheme and investment funds. For product disclosure statements please visit Simplicity's website simplicity. kiwi.