Investing in your child’s future

Investing in your child’s future

For many of us, lockdown gave us a chance to pause and reassess what’s important and what we value in our lives – such as family time or financial security.

You often will hear financial experts recommending putting away enough money to cover at least three months’ worth of expenses for a ‘rainy day’. This can be a big ask for many of us, but the pandemic has shown to us how important it is to have a buffer set aside if we do encounter tough times.

We often say, it’s never too late to start saving – not just for ourselves, but for our children and grandchildren too.

Day-to-day, we often find ourselves running around chasing a busy schedule under the pressures of everyday life. Before you know it, your children will be almost grown-up. As adults, we know that this brings with it more responsibility, including more significant expenses.

You might find yourself wanting to help them out as they navigate the challenges of adulthood such as buying a car, becoming a parent, getting an education or getting into their first home. The recent financial shock to the economy may have caused you to think about how you can help set up good saving habits for your children.

Suppose you have found yourself with some additional savings after spending less than usual during lockdown. Now might be the time to start thinking about how you can give your children’s savings a kick start. One of the options could be a KiwiSaver account.

 

How may KiwiSaver be able to help children?

A first step in setting good long term saving habits is to set your children up with a KiwiSaver account. This may be one part of the plan as you look to set your child up for the road ahead. They may not see the value of it now but, however in the future, it will likely benefit them. At Christian KiwiSaver Scheme we don’t charge any fees for under 18s.

According to IRD, as of June 2019, around 300,000 children under 18 were enrolled in KiwiSaver.

KiwiSaver can be a great start for children when they look at buying a first home. They can use some of their KiwiSaver balance towards a deposit. We have seen in the media over recent years how some First Home Buyers have found it difficult to get on the property ladder. Starting to save early could help alleviate some of the pressure down the track.

Opening a KiwiSaver account in most cases is more accessible to parents than looking at other types of managed funds. With no fees for under 18s at Christian KiwiSaver Scheme and no minimum regular contributions needed for your children’s accounts (unless the child has chosen to contribute if they are employed), you or your child can contribute as much or as little to the account as you want – it’s on your terms.

Joining KiwiSaver young ensures your child will have a head start in saving for their long term future.

If you want to enrol a child with Christian KiwiSaver Scheme, you can do this by filling out an application form at the back of our Product Disclosure Statement and sending it to PO Box 12-287, Thorndon, Wellington 6144.

 

Not already a member of Christian KiwiSaver Scheme? Join other like-minded Kiwi Christians growing their savings ethically today!

Membership of the Christian KiwiSaver Scheme is offered only to:

  • employees of organisations whose primary activities are in our opinion Christian mission or ministry. This includes employees of charitable entities associated with or operating in the Christian Church, or employees of entities which we approve as having a Christian special character; and
  • persons who express a Christian faith and have a commitment to Christian community involvement when applying (and their immediate family members and dependants).

Christian KiwiSaver Scheme is managed and issued by The New Zealand Anglican Church Pension Board (trading as Anglican Financial Care). The Product Disclosure Statement and Fund Updates are available under Documents.

Do you know what type of investor you are?

Do you know what type of investor you are?

Financial markets can go up but they can also go down as we have recently seen with the Covid-19 pandemic. While we may not like seeing our investments decrease, this can happen when a major global event occurs. It is important to understand what your investment goals are and the timeframe you are working towards for when you may need access to those funds. This will depend on your own personal situation.

Being in the investment fund that best suits you is very important. Not knowing can cost you money if you make decisions that are a reaction to investment markets (e.g. a negative return) rather than a change in your personal circumstances or your feelings about risk.

Changes in the investment markets don’t change your investor type, changes in your personal circumstances are what influences your investor type.

You can also have more than one investor type (this can also be called your ‘investor profile’) depending on your personal investment goals. Confused? The Sorted website has some good information on it to explain how you can work this out and decide which type of Fund may best suit you. You can sign up on the Sorted site and save your personalised findings.

Sorted also has a personality quiz where you can find out if you’re a money maestro, practical domestic, authentic dreamer, money mechanic or one of the 12 other types.

 

Are you paying the right amount of PIR tax?

Are you paying the right amount of PIR tax?

Some of you may be asking what’s a PIR and what does this mean for me?  Your PIR is your Prescribed Investor Rate. For KiwiSaver schemes, this is the tax rate that applies to investment earnings allocated to your KiwiSaver account.

There are three PIR rates: 10.5%, 17.5% and 28%. As a general rule if your taxable income is above $48,000 then your PIR should be 28%.

It’s important to have the correct PIR. If your PIR is too high then you will be paying more tax than you need to. If your PIR is too low then you could be facing a tax bill.

Has Inland Revenue been in touch with you about your PIR? In 2019 Inland Revenue identified 450,000 New Zealanders who they determined were on the wrong PIR. Inland Revenue contacted those who appeared to have a PIR that was too low and advised how much tax they owed.

Inland Revenue replaced their computer system and that means it can now check your PIR against your personal taxable income. Your PIR is based on your income. If your income changes (up or down), this might mean a change in your PIR. Your residency status can also affect your PIR. Inland Revenue can also now let your KiwiSaver provider know if it looks like you are one the wrong PIR rate.

We have put a one-page guide together that may help you in calculating your PIR rate.

You can log into your Christian KiwiSaver Scheme account and check your PIR. If you need to change your PIR then send us an email. If you’re not sure then you can phone us on 0508 738 473.

Some more KiwiSaver jargon

Some more KiwiSaver jargon

This is the third article on KiwiSaver related jargon used by the media and others. We try to use plain English but every now and again a bit of jargon is inevitable in our communications with you. Over the coming months, you are also going to be receiving a range of annual documents and this explanation covers this range of documents.

Confirmation Information: This is an annual statement setting out your balance, contributions and fees. This year there will also be some new information on retirement savings and income projections. We usually send this to you during June.

Annual Report: This is a report sent or notified to you by us as your KiwiSaver scheme provider. It sets out information about the Christian KiwiSaver Scheme. It includes the number of members and whether there have been any material changes to the Scheme during the year. We usually send this to you during August. A copy will also be put onto the Christian KiwiSaver Scheme website.

Fund Update:  The Christian KiwiSaver Scheme is a restricted KiwiSaver scheme (see October 2019 Newsletter) and provides an annual update about how the funds have performed. There is a separate Fund Update for the Income Fund, Balanced Fund and Growth Fund. These will be made available towards the end of June. Copies will be available on the Christian KiwiSaver Scheme website.

Please tell us if there is something you’d like us to explain.

There is a KiwiSaver Glossary on the website under Documents/Guides & Policies that explains most of the KiwiSaver related jargon.

Choosing a KiwiSaver scheme can be like choosing a pizza

Choosing a KiwiSaver scheme can be like choosing a pizza

When it comes to ordering a pizza, there are so many different outlets we can use, and, even then, there are so many different flavours to suit our tastes – from meaty, seafood, vegetarian to vegan pizza.  There’s even a range of crusts we can choose between, from thin to crusty to pan fried.  For the more health conscious among us there’s now available four-star nutritional pizzas.

You know, choosing the right KiwiSaver provider and scheme for you can be like choosing the type of pizza we want.  There are so many providers out there, and even when we may have found a provider we like there’s a range of funds between conservative, balanced, growth or aggressive and it can be confusing.

Now, like choosing that nutritious pizza, there’s a range of ethical – or socially responsible – KiwiSaver schemes and providers in the market.  This can make it difficult to choose something that matches what we’re looking for.  While in selecting a pizza it will depend on what flavour or taste we’re looking for, in choosing a KiwiSaver scheme that’s right for us it’s down to our individual values and beliefs.

Values are very abstract concepts aren’t they? But basically they’re our preferences and priorities.  We only really know that values are in our lives when we’re living in line with them.  Unlike that pizza in the picture, values are so intangible; we can’t touch them.  It could be said that our values are ideas that enable us to prioritise all our experiences.

Our beliefs influence and create our values.  The Christian KiwiSaver Scheme is based on universally accepted Christian values, and our investment team apply those values to where funds are invested.

Just like in choosing the type of pizza you eat – whether you want a vegetarian or even vegan pizza the key to avoiding any value conflicts is to be really clear about your priorities and align these with all aspects of your life – from your choice of pizza to including in your KiwiSaver provider or fund the type of companies you would want to invest in.

When next you order a pizza think about how you choose the toppings and base, see if it lines up with your values.  If you would like to talk with us about our ethical investment options check us out at Anglican Financial Care’s Christian KiwiSaver Scheme website. Or, if you prefer, give us a call on (0508) 738 473.

Love comes down from Heaven

Love comes down from Heaven

It is a pleasure to send you Christmas greetings on behalf of the Board of Anglican Financial Care, as we approach this holy season, and await the longed-for birth of Christ. In our celebrations we give thanks that God is continually reaching out to us, longing to be born in us, longing for us to be in God’s company and drawn into the divine life of God. This is why Christmas is a special time. It means tasting something of heaven on earth as Love comes to surround us and indwell us.

Christmas tells us that all human life is profoundly sacred, so much so that God comes to us in human form to speak to us on our level and in our language. In this festival God is telling us and showing us that human beings in their fragility and humility can be full of God; very holy, very precious. In the message of the birth of Christ about which the angels sing and shepherds rush to adore, we see that all life is held in God and surrounded by God, and that God can reach out to us at any time and in any place, especially to the places engulfed in the darkness of suffering and pain.

Given the events of the last year and the moral issues currently being debated in our Parliament at present, this message is needed in our world more than ever. That someone could be so filled with hate that it was possible to destroy so many lives in the Mosque shootings last March is unfathomable. Every Christmas we celebrate God becoming fully human, thus making our humanity holy. If we are to take this message to heart, and open our own hearts to the indwelling of God, then we need to embrace those who appear to be ‘other’, to overcome our fear of those who are different, learn to move beyond tolerance of others to being in relationship, and to celebrate our common humanity.

For when the heavens are opened on that first Christmas night, what is disclosed? God. God revealed in the flesh; God, full of grace and truth. We see the fragility and vulnerability of human existence in the new-born baby. When we look toward that holy Child, we see only Love; Love that is offered freely, that is not manipulative, controlling, fearful, or violent. It is Love that is simply present, that we can choose to receive and to adore, or not. It is Love that has come to win us over, to draw us to God. It is the same Love that moves the stars and stirs our hearts. It is a Love that invites our total allegiance. This Love also helps us see our humanity from a fresh angle; it is fragile, dependent, but more holy than we could ever have imagined. It tells us that our own very being comes from the heart of God and is the result of the creative outpouring of Love who looks upon all that has been made and pronounced it to be very good.

“Come, Holy One, come, my Redeemer; come Lord Jesus, and be born in me, live in me, grown in me, until my life is transformed by your life and I seek only to know your love and make your love known. Amen.”*

May you and yours have a holy and blessed Christmas and a happy New Year.

Dean Lawrence Kimberley
Chairperson

 

 

*Christopher L. Webber Ed., Advent with Evelyn Underhill, Morehouse Publishing, Harrisburg-New York, 2006.