I have ‘lost’ a reasonable amount of my  cash when I need it working for me. Yup, I am one of thousands who took the fitch rating given to Hanover Finance as a sign of a thumbs up. Poppy Cock. 

I am also feeling stupid, feeble and angry at my self for not doing my homework and being dare I say it, Greedy.. It’s funny that I do more research into buying a fridge or PC than I did investing [should that be donating?] in Hanover Finance…

Lessons learned from this little doctorate of life:

1) Don’t believe the hype. Nice recognised Kiwi homely guy -Richard Long- doing the ad voice over, flashy sponsorship of NZ morning business TV program, massive media coverage in evry format, …must be good - looking at the 10% interest rate on 1st Ranking SECURED debenture stock…

2) Look at the rating. Now I have learned what ‘Non Investment Grade’ means. I have to put this lesson up with the one I learned as a kid…the one about not sucking lemons! I thought a Fitch B+ would be good. Here’s the list…look where Hanover sits.

Investment Grade 

• AAA  : the best quality companies, reliable and stable
• AA  : quality companies, a bit higher risk than AAA
• A  : economic situation can affect finance
• BBB  : medium class companies, which are satisfactory at the moment

Non-Investment Grade (also known as junk bonds)

• BB  : more prone to changes in the economy
• B  : financial situation varies noticeably [Hanover]
• CCC  : currently vulnerable and dependent on favorable economic conditions to meet its commitments
• CC  : highly vulnerable, very speculative bonds
• C  : highly vulnerable, perhaps in bankruptcy or in arrears but still continuing to pay out on obligations
• D  : has defaulted on obligations and Fitch believes that it will generally default on most or all obligations
• NR  : not publicly rated

If you are gonna part with a reasonable amount of cash into an investment….talk to people who know, don’t know and those who have no opinion.  Then make up your own mind.  Don’t do as I/we did…and get sucked into the “woohoo… $6K in only 12 months for doing nothing” closed group chat thing…I have done very much more than $6k’s worth of worrying, pleading, letter writing, moaning and now crying in the last 12 months.

4) And when you’re down in the dumps about the bad investment you/I made, don’t listen to all the pricks who come out saying things like “well I warned you…” or “you should have known” blah blah blah. Hindsight is awesome.

On a final note it will be interesting to have a little look-see in about 25 years when people want to draw on their nice  kiwi-saver scheme pension….shock horror….”what do you mean it wasn’t guaranteed? that’s my life savings mate?”…

I can’t believe the NZ Government will stand by and let these two F$#%&^s just carry on with their oh so fantastic [rich] lives when  this blows over them….

I tried to be proactive with my investments for my future but I suppose greed and stupidity/naivity on my part led to this. So I’ll suck this one and get on with it. I’m only 34.

Some older people arn’t so lucky. I hope Eric and Mark get their big dollop of karma….