About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds Other Sites:   tmmonline.nz  |   landlords.co.nz
Last Article Uploaded: Wednesday, November 13th, 10:12PM
rss
Latest Headlines

New advice fee model for KiwiSaver

Milford Asset Management has launched an innovative new way to pay advisers for giving advice on its popular KiwiSaver funds.

Wednesday, October 16th 2019, 6:00AM

Michael Robson

Milford wants to make sure advisers are getting paid for giving advice around its KiwiSaver funds, but has chosen not to go down the trail commission route like other managers.

Under its new model, called an "Advice Facilitation Fee", advisers can be paid either a $150 upfront consultation fee for giving advice or the client can pay the adviser out of their funds under management. With the latter option a 20 basis point fee on the sum invested is paid from the KiwiSaver member's account to the adviser.

Michael Robson, Milford head of intermediary distribution, says "advisers need to be paid for the advice given".

"There is a cost to giving advice and this is a way of remunerating advisers."

To make this cost neutral Milford will also rebate its management fee by the same amount. Robson says this is fair as the fund manager no longer has to service the member.

Robson says the advice fee will be clearly disclosed on each KiwiSaver members statement each month. This makes the fee transparent and ensures members are aware it is being paid to the adviser. 

One difference between Milford and other managers working with advisers in the KiwiSaver space is that it is only offering this service to authorised financial advisers. Other managers, including Generate, NZ Funds and Booster are highly active in the registered financial adviser space.

Robson says Milford may at a later date extend this fee model to RFAs, but not at the start.

He says many advisers use Milford's unit trust products, but this model isn't currently available for those funds. He says many of the advisers using the unit trusts for their clients operate on a fee-for-service basis.

He said the manager may look at this in the future, and the model recently launched may evolve over time.

"We could adapt and add more options in the future," Robson says.

"I wouldn't be surprised if this is where the industry moves to," Robson says of this new model.

Robson says Milford consulted the Financial Markets Authority on its new model.

Tags: fees KiwiSaver Milford Asset Management

« Legislation overload 'could have unintended consequences'Advisers not dropping out, Financial Advice NZ says »

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

Weekly Wrap

Previous News

MORE NEWS»

Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 5.19 4.05 3.95 4.49
ANZ Special - 3.55 3.45 3.99
ASB Bank 5.20 4.05 3.95 4.39
ASB Bank Special - 3.55 3.45 3.89
BNZ - Classic - 3.55 3.45 3.99
BNZ - Mortgage One 5.90 - - -
BNZ - Rapid Repay 5.35 - - -
BNZ - Std, FlyBuys 5.30 4.45 4.35 4.55
BNZ - TotalMoney 5.30 - - -
China Construction Bank 5.50 4.70 4.80 4.95
China Construction Bank Special - 3.19 3.19 3.19
Lender Flt 1yr 2yr 3yr
Credit Union Auckland 5.95 - - -
Credit Union Baywide 6.15 4.95 4.95 -
Credit Union North 6.45 - - -
Credit Union South 6.45 - - -
Finance Direct - - - -
First Credit Union 5.85 3.99 4.49 -
Heartland 6.70 7.00 7.25 7.85
Heartland Bank - Online - - - -
Heretaunga Building Society 5.75 4.80 4.95 -
HSBC Premier 5.24 3.35 3.35 3.35
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 5.15 3.18 3.18 3.20
Kainga Ora 5.18 4.04 3.95 4.39
Kiwibank 5.80 4.30 4.20 4.64
Kiwibank - Capped - - - -
Kiwibank - Offset 5.15 - - -
Kiwibank Special - 3.55 3.45 3.89
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 5.70 4.25 4.15 -
Pepper Money Near Prime 5.64 - 5.44 5.44
Lender Flt 1yr 2yr 3yr
Pepper Money Prime 5.18 - 4.98 4.98
Pepper Money Specialist 7.59 - 7.39 7.39
Resimac 4.50 4.86 3.89 3.94
RESIMAC Special - - - -
SBS Bank 5.29 4.85 5.05 5.49
SBS Bank Special - ▼3.55 3.39 3.89
Sovereign 5.30 4.15 4.29 4.55
Sovereign Special - 3.65 3.75 4.05
The Co-operative Bank - Owner Occ 5.15 3.49 3.59 3.89
The Co-operative Bank - Standard 5.15 3.99 4.09 4.39
TSB Bank 6.09 4.35 4.25 4.69
Lender Flt 1yr 2yr 3yr
TSB Special 5.29 3.55 3.45 3.89
Wairarapa Building Society 5.70 4.85 4.99 -
Westpac 5.34 4.15 4.09 4.49
Westpac - Offset 5.34 - - -
Westpac Special - 3.55 3.45 3.99
Median 5.34 4.04 4.09 4.39

Last updated: 11 November 2019 4:01pm

News Quiz

The maximum remuneration model for Australian life insurance advisers is to be set at what?

Upfront 40% + trail 20%

Upfront 50% + trail 10%

Upfront 50% + trail 20%

Upfront 60% + trail 10%

Upfront 60% + trail 20%

MORE QUIZZES »

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