KiwiSaver

Craigs Investment Partners is renaming both its KiwiSaver schemes in a bid to improve clarity for consumers.

Craigs has announced it is to repackage its kiwiSTART Defined KiwiSaver scheme as QuayStreet KiwiSaver.

Quay Street will take over as the named manager of the fund from Craigs Investment Partners Superannuation Management, but the underlying product, and the funds it invest in remain unchanged.

The scheme already only invested in QuayStreet funds – the fund manager is a wholly-owned subsidiary of Craigs Investment Partners.

Craigs’ KiwiStart Select product is also being rebranded, as Craigs Investment Partners KiwiSaver.

It allows investors to pick and choose the securities their funds invest in. 

Craigs head of client services Stephen Jonas said: “There’s fundamentally no change in the style and nature of the product offered but it should be much clearer in the marketplace what it is and who is offering it.”

He said the new names should be in place in the market by December 1.

Jonas said his firm was also working to launch a new superannuation scheme and hoped to have the new QROPS offering in the market by December 1, too.

It will offer self-selected portfolio construction and the firm is developing a new platform to make it easier for investors to access a broader range of securities.

But he said more clarity was still needed on what could be done about people who had transferred money to a  KiwiSaver scheme before they all lost their QROPS status. That money is now effectively locked into the schemes it was transferred to, because it cannot be moved without incurring a tax bill.

“If you transfer that money you breach the HMRC rules [in Britain] but if you don’t, you breach the KiwiSaver Act. We are asking for clarification on that.”

A financial adviser is re-launching a KiwiSaver scheme in partnership with Forsyth Barr.

Martin Hawes is chairman of the investment committee for Summer KiwiSaver.

He said he wanted to grow the investment culture in New Zealand.

He said New Zealanders could miss out on tens of thousands of dollars in retirement unless they became more actively involved in driving their investment choices.

“New Zealanders are notoriously disengaged with their KiwiSaver. One quarter of KiwiSaver members don’t even know what kind of fund they’re invested in*. That’s dangerous. If you’re still 10 or 20 years from retirement you risk missing out on thousands in retirement,” he said.

Hawes, an AFA, d will lead communications with the scheme’s members. Forsyth Barr’s funds management team will handle day-to- day investment management.

Hawes said his move into KiwiSaver was a natural extension of his mission to reach as many New Zealanders as possible with the message that the small decisions you make today can have a massive impact on your lifestyle in retirement. The scheme was named Summer in reference to Hawes’ 2006 retirement planning bestseller 20 Good Summers – and to acknowledge that retirement can be the best years of your life if your finances are well organised.

He said a danger to many New Zealanders achieving the retirement they aspire to is to is being disengaged from their KiwiSaver account.

“For many New Zealanders KiwiSaver will be their most significant financial asset outside the family home. That’s why it’s critical to get involved with your KiwiSaver investment now and take charge of it to create the future you want,” he said.

Summer KiwiSaver members will have the opportunity to learn about investing from Hawes’ regular communication with them. They’ll also have the chance to put that into action by deciding the weighting of their investment allocated to different investment classes.

“With Summer, you can get involved as much or as little as you choose. We offer the Investment Selection option for members who would rather let us make the decisions for them and keep them informed along the way. Those who like to be more involved can allocate their investment across different funds that invest in cash and domestic and global fixed interest and shares, depending on how they read the market at any given time.”

A working group has already begun to look at ways that KiwiSaver fees could be reported with more transparency.

There has been criticism raised over many providers’ habit of displaying fees as a percentage or basis point calculation, rather than a dollar amount.

CFFC group manager of investor capability David Boyle said there was clear consumer demand for fees to be presented in an easier-to-understand way.

He said New Zealand could be among the first in the world to move to a dollar-figure representation.

There was strong Government interest in making it happen, he said. He is part of a working group that is looking at how the transition could be made. “It looks like it will happen here.”

New low-fee provider Simplicity said there was a need for change.

“Alarming reports of widespread misleading fee disclosure practices is an opportunity for the entire KiwiSaver industry to come clean and commit to full transparency and disclosure,” said Simplicity managing direct Sam Stubbs.

“New Zealand can become a world leader in disclosure and transparency of fees if we learn from this experience.”

New low-fee KiwiSaver provider Simplicity has started accepting enrolments.

“The platform has been thoroughly tested, and has passed with flying colours. It’s now fully functioning, industrial strength and ready to make Kiwis richer in retirement,” said managing director Sam Stubbs.

He said customer demand had been strong.

“We’ve already reached our 12 month targets. Thousands have registered interest, and we are now making Simplicity fully available to them’,” he said.

Simplicity has been appointed by power company Genesis Energy as a preferred supplier, and is being recommended by two financial provider networks.

Simplicity is also a finalist in the NZ Innovation Awards.

“We are delighted to have been recognised for our 100% online, lowest cost, nonprofit model, which could make the average KiwiSaver $65,000 richer in retirement. See our website for the calculations and assumptions,” Stubbs said.