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KiwiSaver calculator all sorted - yeah right!

Tuesday, February 5th 2008, 1:24PM 3 Comments

by Philip Macalister

Working out the fees on KiwiSaver funds is something, it seems, even the experts can't do. From memory there are at least three calculators out there. First was one from Trident Research in Christchurch. The second was from Gareth Morgan - who promptly bagged his competitor as soon as he entered the market. Then many people bagged Gareth's one as it appeared to be a blatant push for his own product. This has been achieved by making a lot of assumptions about other funds. Now we have a piece of work from the Retirement Commission, which has been bagged by fund managers. Just to make things even more interesting, one of the peer reviewers of the Retirement Commission - Michael Littlewood - bagged Consumers’ KiwiSaver site. What can you make of all this? Basically, no-one really knows how fees will stack up in funds. This is a bit of an inditment on the savings industry, highlighting what is a weakness. One argument put to me, and one I like - is that it seems we won't really know what the levels of fees in KiwiSaver funds are till next year when MERs (management expense ratios) are available for the funds, plus their performance. But of course then there are those who bag the guidelines for calculating MERs!
« What's happening at MFS?MFS - what a mess »

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Comments from our readers

On 7 February 2008 at 6:20 pm The Lone Ranger said:
I regard the fees on Kiwisaver as irrelevant.As a Kiwisaver accountholder,I am interested in the highest possible return post fees.If my chosen fund manager does not perform,I will look for the fund manager who I perceive can provide the highest returns.I am very happy to pay higher fees if my net return post fees is higher.
On 12 February 2008 at 9:50 am Kimble said:
Fees will consume a massive chunk of your long term return Lone Ranger. Cheap and passive may not look sexy but its middle of the road performance (actually there is plenty of evidence that passive funds outperform more funds than they underperform) and lower costs can create a sort of virtual alpha.

The sort of fee you are looking for by the sounds like a performance fee that will pay managers for their outperformance. But watch out for managers that charge a performance fees but dont discount their base fee.
On 12 February 2008 at 11:23 pm The Lone Ranger said:
I'm like many other punters I suspect who are putting only a minimum amount into Kiwisaver to pick up the Govt perks.I'm trying a higher risk fund and will give it three years.
Of course I should have followed Chris Lee's advice and put it into a low risk fund for a couple of years,but I am headstrong.
Commenting is closed

 

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Lender Flt 1yr 2yr 3yr
AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.14 6.75 6.39
ANZ 8.64 7.74 7.39 7.25
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.14 6.79 6.65
ASB Bank 8.64 7.14 6.75 6.39
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
Basecorp Finance 9.60 - - -
Bluestone 9.24 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Classic - 7.14 6.79 6.65
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 7.74 7.39 7.25
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 6.79 - -
Co-operative Bank - Owner Occ 8.40 6.99 6.79 6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.49 7.29 7.15
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 6.89 6.55 6.35
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.69 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 ▼7.74 ▼7.35 ▼6.99
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 7.99 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 6.99 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.65 7.25 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
Resimac - LVR < 80% 8.84 8.09 7.59 7.29
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 9.09 8.59 8.29
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 7.74 ▼7.09 ▲6.95
SBS Bank Special - 7.14 ▼6.49 ▲6.35
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 6.14 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
Select Home Loans 9.24 - - -
TSB Bank 9.44 7.79 7.55 7.45
Lender Flt 1yr 2yr 3yr
TSB Special 8.64 6.99 6.75 6.65
Unity 8.64 6.99 6.79 -
Unity First Home Buyer special - 6.55 6.45 -
Wairarapa Building Society 8.60 6.95 6.85 -
Westpac 8.64 7.84 7.35 6.99
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.24 6.75 6.39
Median 8.64 7.19 7.17 6.65

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