KiwiSaver is a great way to save for your first home or retirement. New Zealanders currently have over $58 billion invested in various KiwiSaver Schemes. The average balance is over $19,000 with some members now having grown their KiwiSaver investment to well over $100k.
Let’s make it simple. You have three choices.
1) KiwiSaver – do you want in?
2) Provider – do I go with my bank or a KiwiSaver specialist?
3) Choose the right fund for you – Conservative, Growth or a mix?
Kiwis can join through their employer, bank or insurance company or a specialist KiwiSaver investment manager. Those who are employed contribute either, 3%, 4%, 6%, 8% or 10% of their total before tax income. Employers and the Government also help with members savings respectively by making “Employer contributions” and the “Government contribution”. You can let your employer know that you’ve joined KiwiSaver and your chosen contribution rate by filling out a KS2 form.
If you’re over 18, live mainly in New Zealand and are not yet eligible to withdraw from KiwiSaver, then for every $1 you put into your KiwiSaver account between 1 July and 30 June each year, the Government will contribute 50 cents, up to a maximum of $521.43. To maximise this benefit you could contribute $1,042.86 each year through your employee or voluntary contributions. If you want to make small and regular contributions, this works out to be around $21 a week.
Generate – KiwiSaver specialists
For some, having their KiwiSaver with the same business as their mortgage, savings and credit cards, may seem like an easy solution. However, as a KiwiSaver specialist, Generate has some important points of difference.
Generate’s focus is on retirement savings. They actively monitor your investment, believing they can give you a better return long term measured against passive fund managers. Their three funds, Growth, Focused Growth and Conservative have performed in the top four in the FundSource Diversified Growth and Diversified Defensive categories for the 5 year period to 31 May 2019.
Since starting over six years ago, Generate has grown to over 67,000 members and over $1.4 billion funds under management as of 08.07.19. New Zealand owned and operated, Generate’s investment decisions are made by an investment committee that has more than 100 years of combined investment expertise. Our members are the most important part of the Generate KiwiSaver Scheme. Our goal is simply to help our members grow their savings and achieve the lifestyle they want in retirement.
We are the 10th largest provider by members and over 90% of our members have received advice on their KiwiSaver. These members are empowered to make an informed decision which could add hundreds of thousands of dollars to their KiwiSaver balance at retirement. Making an active fund choice is important and should take your risk profile and the risks of investing into account.
This article is intended to provide general information only and does not constitute financial advice under the Financial Advisers Act 2008. Adviser Disclosure Statement is available on request and free of charge. Past performance is not a reliable indicator of future performance. Generate Investment Management Ltd is the issuer of the Generate KiwiSaver Scheme. A copy of the PDS is available at: https://www.generatekiwisaver.co.nz/pds