tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Tuesday, March 19th, 6:25PM

Investments

rss
Latest Headlines

KiwiSaver must change, providers say

Product-based commission should be banned for financial advisers offering advice on KiwiSaver, Milford Asset Management chief executive Troy Swann has told an event in Auckland.

Wednesday, June 13th 2018, 6:01AM

by Susan Edmunds

The Commission for Financial Capability this week held its annual summit.

A panel was asked for views on how KiwiSaver should be changed, as it goes into its second decade of existence.

Commission investor education group manager David Boyle said the lack of contribution, general low balances, and the conservative investment profile of many investors, were a major problem for the scheme, despite the large number of people who had joined.

Swann said, among other changes, there should be no commission paid on advice for KiwiSaver in future.

It altered recommendations advisers gave, he said, and was not good for the country.

"Advisers should absolutely be able to charge for and be paid for the valuable service and advice they provide to clients – but product commissions, which are paid by manufacturers for the sale of the product and where no initial or ongoing advice is provided by the adviser is not in the best interests of the client," Murray Harris, Milford's head of advice, said.

Milford does not pay commission to advisers for KiwiSaver.

But Liam Mason, head of regulation at the Financial Markets Authority, said financial advice had a key part to play in KiwiSaver.

Members who sought advice and came up with a plan in the years close to retirement had much better rates of achieving their goals, he said.

"If you can get financial advice in the last few years of savings, the outcomes go up dramatically."

He said New Zealand should be asking "quite a lot of people who get to wear the KiwiSaver badge". 

Sam Stubbs, founder of Simplicity, which also does not pay commission to advisers, said some providers would experience a shake-up of distribution over the coming years.

"AI is going to decimate traditional distribution channels and advice. It's free and transparent and transparency is not a feature of the financial services industry. That will happen fairly quickly."

AI would draw on publicly available information to provide simple personalised advice within 12 or 18 months, he said.

"We've said we're doing to do it, produce an product-agnostic, open-source platform that's free to everyone. That's the way that advice gets into the hands of people who can't afford to get advice."

Providers who created good products that helped people would do well, he said. But moat-based businesses that relied on distribution channels would face a serious challenge from technology.

Tags: FMA KiwiSaver Milford Asset Management Simplicity

« The employer’s conundrumAdvisers set clients on right investment path »

Special Offers

Comments from our readers

No comments yet

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

News and information about KiwiSaver

Previous News
Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.24 6.79 6.65
ANZ 8.64 7.84 7.39 7.25
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.24 6.79 6.65
ASB Bank 8.64 7.24 6.79 6.65
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 - 7.24 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 7.84 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 - 7.04 - -
Co-operative Bank - Owner Occ 8.40 7.24 ▼6.79 ▼6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.74 ▼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 6.69 6.45 6.19
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 ▼6.75 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.79 ▼7.39 ▼7.25
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 8.25 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 7.25 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.75 7.35 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
Resimac - LVR < 80% 8.84 8.30 7.89 7.69
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 9.30 8.89 8.69
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 7.84 7.45 7.25
SBS Bank Special - 7.24 6.85 6.65
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 6.74 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
Select Home Loans 9.24 - - -
TSB Bank 9.44 8.04 7.55 7.45
Lender Flt 1yr 2yr 3yr
TSB Special 8.64 7.24 6.75 6.65
Unity 8.64 6.99 ▼6.79 -
Unity First Home Buyer special - - 6.45 -
Wairarapa Building Society 8.60 7.15 6.85 -
Westpac 8.64 7.89 7.49 7.25
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.29 6.89 6.65
Median 8.64 7.29 7.32 6.65

Last updated: 14 March 2024 9:32am

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox  |  Disclaimer
 
Site by Web Developer and eyelovedesign.com