by Editor | 30 Jul, 2020 | Investment, KiwiSaver
We have put together a couple of scenarios based on different life stages. First, we look at how a younger investor may view their KiwiSaver investment, followed by someone who is looking at retiring sometime in the next couple of years.
Scenario 1: I am in my mid-30s and am in a ‘growth’ fund.
At Christian KiwiSaver Scheme we have three funds members can choose from, and you can select one fund or a combination of all three depending on your risk appetite and goals. For example, if retirement is still some years away, you may consider leaning towards a growth fund.
However, this choice may also be affected by your approach to life. If you tend to grow nervous every time the market changes, your attitude towards ‘risk’ might not suit a growth fund. Growth funds can be described as higher risk but with the potential for higher returns.
You should also factor in your own personal circumstances. A lot of people choose to be in a growth fund to maximise the time their investment has to perform before they retire. However if you think you may need to make a first home withdrawal in the next couple of years, it may pay to look at a mix of funds that give you a more conservative investment profile to minimise the impact of any significant market movements in the short term.
It is important to be aware that if you switch funds while the markets are down, you will likely lock in any losses you’ve already seen. What does this mean in simple terms? If the market bounces back, you may not see the benefit from that bounce back to the same extent you would if you had not switched funds.
Prior to COVID-19, a lot of KiwiSaver providers had seen a sustained period of good returns. While you may have seen a drop in returns at the start of the COVID-19 pandemic, we have since seen the market rebound strongly from the lows that were seen. History tells us that markets tend to recover, though they may undergo change and not look the same as they once did.
We recommend that you take a look at the ‘Investor Kickstater’ calculator on sorted.org.nz, which will help you better determine what fund you might want to be in. It will ask a couple of simple questions around what life stage you are in, your income, your debt and your security etc.
Remember that there is no one answer for everyone, but if you are able to understand your risk appetite better, you are more likely to be able to find the right fund to suit you.
Scenario 2: I am nearing retirement and my KiwiSaver is currently split into different funds
A different view would be given for someone who is approaching retirement compared with someone in their mid-30s; however, it’s still important to review your appetite for risk. If you are in a growth fund and you will think you will need the money within the next few years there may be insufficient time for your investment to recover from a market decline.
If you do not need access to your KiwiSaver balance immediately at age 65, and you have a higher appetite towards investment risk, you may want at least some of your money invested in more risky assets classes such as shares.
Note that you can choose to have regular payments from your KiwiSaver account paid to you after age 65 at regular intervals. This means that the money you don’t need access to immediately can continue to benefit from being invested. If this is something you would like to look into, you can contact our team for further information on how this can work for you.
There isn’t one scenario for everyone. Therefore we recommend that you take a look at the ‘Retirement Planning’ tool on sorted.org.nz to work through how much you want to aim to have to live on throughout your retirement years. This will help give you an idea of your projected balance based on your circumstances.
If you are currently approaching the age at which you wish to retire, you may want to seek advice from a financial advisor if you have access to one. Your KiwiSaver balance could be one piece of your retirement equation, and you will want to make sure that all parts align for a happy retirement.
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.
by Editor | 1 May, 2020 | General, KiwiSaver
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.
by Editor | 3 Feb, 2020 | General, KiwiSaver
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.
by Editor | 3 Feb, 2020 | KiwiSaver
There’s a lot of jargon used by the media and others when it comes to KiwiSaver and we started explaining some of this in our October 2019 issue. We try to use plain English but every now and again a bit of jargon is inevitable in our communications with you. Please tell us if there is something you’d like us to explain. This explanation covers the various roles involved with the governance and running a KiwiSaver scheme.
Trustee can be individuals or an organisation, and they hold all contributions and investments in trust. As the Christian KiwiSaver Scheme is a restricted scheme, the Trustee by law is the Manager.
Manager this is your KiwiSaver scheme provider, e.g. Anglican Financial Care, and is the organisation responsible for managing the scheme.
Issuer generally means the Manager of the particular KiwiSaver scheme. For the Christian KiwiSaver Scheme this means Anglican Financial Care.
Administrator, sometimes called the Administration Manager, is the organisation appointed by the Manager to handle the day to day workings of the scheme, e.g. updating your account details, your account balance and paying withdrawals. For Christian KiwiSaver Scheme this means Anglican Financial Care.
Investment manager, sometimes called Fund Manager, this is a person or organisation appointed by the Manager to look after all or some of the KiwiSaver scheme’s investments. Anglican Financial Care undertakes the investment activities for Christian KiwiSaver Scheme.
Custodian and Supervisor are other terms you might hear. The Christian KiwiSaver Scheme is a restricted KiwiSaver scheme (explained in the October 2019 issue) and therefore does not need to appoint people/organisations to these positions.
The Financial Markets Authority which is also referred to by its initials FMA, is the Government agency responsible for enforcing securities, financial reporting and company law as they apply to financial services and securities markets. They also regulate securities exchanges, financial advisers and brokers, auditors, trustees and issuers – including issuers of KiwiSaver and superannuation schemes. As the Manager and Issuer of the Christian KiwiSaver Scheme Anglican Financial Care is required to file a variety of reports to the FMA.
There is a KiwiSaver Glossary on the website under Documents/Guides & Policies that explains most of the KiwiSaver related jargon.
by Editor | 29 Oct, 2019 | KiwiSaver
There’s a lot of jargon used when it comes to KiwiSaver. It’s used by the media, the regulators and also people like us, your KiwiSaver provider. We try to use plain English but every now and again a bit of jargon is inevitable in our communications with you. We’re going to cover a few terms in each newsletter. Please tell us if there is something you’d like us to explain.
KiwiSaver provider means the organisation responsible for managing a KiwiSaver scheme, e.g Anglican Financial Care is the organisation responsible for managing the Christian KiwiSaver Scheme.
Regulator generally means the Government body responsible for overseeing the particular product, service, etc. For KiwiSaver schemes this means the Financial Markets Authority (also referred to as the FMA). They’re important as they keep an “eye” on the providers and others involved with your KiwiSaver scheme.
KiwiSaver scheme is the scheme you join. You can only belong to one KiwSaver scheme at a time. The Government sets out the rules for KiwiSaver schemes in an Act of Parliament, the KiwiSaver Act. A KiwiSaver scheme is run by a KiwiSaver scheme provider and a KiwiSaver provider can offer more than one KiwiSaver scheme. Typically each scheme has a number of funds into which you can invest. Anglican Financial Care has only one scheme, the Christian KiwiSaver Scheme and within it offer 3 funds – the Growth, Balanced and Income Funds.
Restricted KiwiSaver scheme is a KiwiSaver scheme that is not open to the general public, and has restrictions on who can become a member, i.e. the Christian KiwiSaver Scheme is not open to everyone.
Licensed Independent Trustee. Each restricted KiwiSaver scheme must have a Licensed Independent Trustee. The FMA oversees who can be a Licensed Independent Trustee. Brendan O’Donovan is the current Licensed Independent Trustee member of Anglican Financial Care’s Board.
There is a KiwiSaver Glossary on the website under Documents/Guides & Policies that explains most of the KiwiSaver related jargon.
by Jo Cheramie | 8 Aug, 2019 | General, Investment, KiwiSaver
Many of us have grown up with the stories of Winnie the Pooh. If we didn’t, some of us may have seen the recent movie called ‘Christopher Robin’ which re-introduces Winnie the Pooh to a wider audience.
Many of us would be surprised to know that Winnie the Pooh owned a gun in 100 Acre Wood. We would be puzzled as to why they would own guns in that wood as they don’t hunt, and they don’t have target practice. Yet, in one account of Winnie the Pooh’s exploits, there was a knock on the door of his tree. Winnie answered the door … with a gun in his hands.
When A. A. Milne started writing about Winnie the Pooh in 1926, it was a different time with a different attitude toward guns. Like climate change, guns and munitions have increasingly become something that people are concerned about.
After the attacks on the Al-Noor Mosque and the Linwood Islamic Centre in Christchurch earlier this year there has been a growing concern about whether New Zealand KiwiSaver providers have invested funds in arms or munitions. There are some providers that have invested in this industry. But the Christian KiwiSaver Scheme is not one of those; it is among a small number of KiwiSaver providers that provide ethical investments and excludes munitions.
In a recent Colmar Brunton survey, over 70 percent of respondents answered that it was important for them that their KiwiSaver money was not invested in weapons. The survey found that a lot of members didn’t know if their funds were invested in munitions at all.
In New Zealand, there are over 2.7 million people signed up with KiwiSaver. The New Zealand Herald quoted a 2018 Consumer survey finding that around seven out of 10 people wanted their money invested ethically. But only around 8,600 people had signed up to specifically targeted ethical investment funds. While some people may hesitate in investing in ethical funds as they may feel these funds give lower returns, some of the best companies in the current market are those that are the most sustainable companies – they look after the environment and their employees. So thinking seems to be changing among investors.
Remember you can log into your account and check which fund your money is invested in. Or, if you prefer, give us a call on (0508) 738 473.
Winnie the Pooh image from www.disneyclips.com
