Monday, July 5, 2010

Kiwisaver: A mediocre substitute for real saving

Kiwisaver has been lauded by most commentators as the tool to help New Zealanders save money but an almost compulsory scheme that lacks the right incentives and is also designed to provide mediocre returns (see table at bottom) to investors is clearly not the answer.

The big winners have been the Kiwisaver providers who have clipped the ticket along the way while investors have so far lost capital and for folks like Mary Holm and Gareth Morgan -who is also a Kiwisaver provider - who are selling books on the subject.

The only incentive for those to get into Kiwisaver is one of a selfishness and greediness that they can get something for free off their fellow taxpayer or employer in the form of a subsidy or what most would call a handout and that is just morally and intellectually dishonest.

It is mostly a default scheme for the lazy who cant be bothered to opt out when they get a new job and for those already in work the incentive to chose a provider wisely is limited to mostly guesswork.

Kiwisaver is a bloody socialists wet dream but a financial nightmare.

We need choice and real financial incentive to boost our savings levels and the best thing any Government could do would be to lower taxes on all savings and investments therefore providing real long-term returns, a great incentive to start in the first place. The added benefit of choice would follow along with the absence of interference and the extra expense from Bureaucrats within the State system.

Making Kiwisaver strictly compulsory, as Sam Knowles from KiwiBank advocates, will lead to poor returns for investors, and eventually a collapse of the scheme as it eats itself up with expenses and fees.

The Government of the day simply cannot be trusted to keep its nose out of the scheme and it is bound to be interfered with in the future, to the detriment of the investor and at the expense of the taxpayer.

Under Kiwisaver individuals in the scheme have no control over where their provider puts their money and it could be invested in any of the harebrained "investments" that many have lost their money in over the last few years. Hardly a good investment and not safe at all.

Better that the individual has control over where their moola goes and that way, with a little education, your money can go where you want it too and you will have more chance of having it if you retire.


KiwiSaver Performance Survey - Returns to 31 March 2010
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Default Options
3-month
(%)
6-month
(%)
1-year
(%)
2-year
(%pa)
AMP KiwiSaver (Default) Fund
1.04
2.93
7.50
4.67
ASB KiwiSaver Conservative Fund (Default)
2.05
3.32
9.89
5.58
AXA KiwiSaver Income Plus (Default)
2.24
4.07
14.15
5.67
ING KiwiSaver - Conservative Fund (Default)
1.93
3.40
9.97
5.21
Mercer KiwiSaver Conservative (Default)
2.83
4.66
17.63
6.60
TOWER KiwiPlan-Cash Enhanced (Default)
1.77
3.44
10.51
4.87





Multisector Options



Conservative
3-month
(%)
6-month
(%)
1-year
(%)
2-year
(%pa)
AMP KiwiSaver (Default) Fund
1.04
2.93
7.50
4.67
ANZ KiwiSaver - Conservative Fund
1.98
3.79
10.35
5.23
Aon KiwiSaver Russell Lifepoints Cnsrv
3.19
6.20
20.66
6.52
ASB FirstChoice KiwiSaver Tracker Conserv Fund
2.05
3.31
9.86
5.61
ASB KiwiSaver Conservative Fund (Default)
2.05
3.32
9.89
5.58
Asteron KiwiSaver Conservative Fund
2.09
4.31
11.95
4.53
AXA KiwiSaver Income Plus (Default)
2.24
4.07
14.15
5.67
Fidelity KiwiSaver-Capital Guaranteed Kiwi
1.48
2.62
6.48
-
Fidelity KiwiSaver-Conservative Kiwi Fund
3.08
5.31
13.44
5.93
Fisher Funds Conservative KiwiSaver Fund
0.38
0.74
-
-
Gareth Morgan Kiwisaver Scheme Conservative Fund
1.66
3.15
6.37
4.95
Grosvenor KiwiSaver Enhanced Income Fund
1.27
2.61
4.80
5.96
ING KiwiSaver - Conservative Fund (Default)
1.93
3.40
9.97
5.21
ING KiwiSaver SIL Conservative Fund
2.03
3.82
10.50
5.41
Mercer KiwiSaver Conservative (Default)
2.83
4.66
17.63
6.60
National Bank KiwiSaver - Conservative
1.99
3.82
10.48
5.29
Smartshares Smartkiwi Conservative Fund
0.71
2.75
7.50
4.09
TOWER KiwiPlan-Cash Enhanced (Default)
1.77
3.44
10.51
4.87
Average
1.88
3.57
10.71
5.38





Moderate
3-month
(%)
6-month
(%)
1-year
(%)
2-year
(%pa)
AMP KiwiSaver Conservative Fund
1.44
3.67
7.75
6.95
AMP KiwiSaver Moderate Fund
1.38
4.16
10.27
4.21
ANZ KiwiSaver - Conservative Balanced Fund
2.39
4.84
15.12
4.36
Aon KiwiSaver Russell Lifepoints 2015
3.14
6.80
24.81
5.04
Aon KiwiSaver Russell Lifepoints Mod
3.16
7.06
26.12
4.34
ASB FirstChoice KiwiSaver Active Conservative Fund
2.53
4.17
15.73
5.62
ASB FirstChoice KiwiSaver Tracker Moderate Fund
2.87
4.79
17.92
3.58
ASB KiwiSaver Moderate Fund
2.88
4.80
17.90
3.80
AXA KiwiSaver Conservative
2.50
4.63
15.85
-
Grosvenor KiwiSaver Conservative Fund
2.43
3.85
12.80
5.99
Huljich Conservative Diversified KiwiSaver Fund
-1.49
-0.69
11.90
9.62
ING KiwiSaver - Conservative Balanced
2.06
3.84
13.49
4.02
ING KiwiSaver SIL Conservative Balanced Fund
2.48
4.92
15.40
4.58
Mercer Super Trust KiwiSaver Conservative
2.72
4.49
19.73
4.74
National Bank KiwiSaver - Conservative Balanced
2.40
4.82
15.13
4.34
Smartshares Smartkiwi Balanced Fund
0.11
4.06
20.81
1.53
TOWER KiwiPlan-Conservative
3.00
5.12
16.46
4.72
Westpac KiwiSaver-Conservative Fund
1.90
3.64
10.72
4.76
Average
2.11
4.39
16.00
4.54





Balanced
3-month
(%)
6-month
(%)
1-year
(%)
2-year
(%pa)
AMP KiwiSaver Balanced Fund
1.26
4.91
14.55
2.02
AMP KiwiSaver Moderate Balanced Fund
1.33
4.66
12.89
2.54
AMP KiwiSaver-TOWER Balanced Fund
3.33
6.55
18.17
3.04
ANZ KiwiSaver - Balanced Fund
2.75
5.76
19.53
3.43
Aon KiwiSaver ING Balanced
3.34
7.13
26.94
6.08
Aon KiwiSaver Russell Lifepoints 2025
3.13
7.65
29.54
2.24
Aon KiwiSaver Russell Lifepoints Bal
3.06
7.89
31.51
1.65
ASB FirstChoice KiwiSaver Active Balanced Fund
3.16
5.58
23.12
2.74
ASB FirstChoice KiwiSaver Tracker Balanced Fund
3.52
6.05
24.21
1.93
ASB KiwiSaver Balanced Fund
3.51
6.07
24.15
1.97
Asteron KiwiSaver Balanced Fund
2.65
5.68
21.52
3.83
AXA KiwiSaver Balanced
2.93
6.61
27.73
3.48
Brook Professional KiwiSaver Scheme Balanced Fund
2.20
4.78
12.78
5.28
Fidelity KiwiSaver-Balanced Kiwi Fund
3.67
6.13
18.69
6.23
Fidelity KiwiSaver-Ethical Kiwi
3.04
5.16
17.74
-
Forsyth Barr KiwiSaver Balanced Port
1.59
3.85
14.57
-
Gareth Morgan Kiwisaver Scheme Balanced Fund
1.80
3.96
7.99
2.08
Grosvenor KiwiSaver Balanced Fund
2.97
4.96
19.32
5.34
Huljich Balanced Diversified KiwiSaver Fund
-3.26
-2.60
13.52
5.80
ING KiwiSaver - Balanced
2.29
4.39
17.00
2.63
ING KiwiSaver SIL Balanced Fund
2.85
5.87
19.81
3.75
Mercer KiwiSaver Balanced
3.38
5.69
29.23
2.03
Mercer Super Trust KiwiSaver Active Balanced
3.38
5.68
28.94
2.01
Mercer Super Trust KiwiSaver Moderate
3.66
6.02
24.70
5.46
National Bank KiwiSaver - Balanced
2.78
5.75
19.50
3.48
TOWER KiwiPlan-Balanced
3.80
6.89
22.29
3.00
Westpac KiwiSaver-Balanced Fund
2.68
5.77
18.61
3.71
Average
2.62
5.44
20.69
3.33





Growth
3-month
(%)
6-month
(%)
1-year
(%)
2-year
(%pa)
AMP KiwiSaver-ING SIL Balanced Fund
2.23
7.36
22.03
3.11
AMP KiwiSaver Growth Fund
1.23
5.70
18.16
-1.64
AMP KiwiSaver - TYNDALL Balanced Fund
3.04
5.95
20.16
2.05
ANZ KiwiSaver - Balanced Growth Fund
3.15
6.69
24.27
2.36
ANZ KiwiSaver - Growth Fund
3.45
7.62
28.90
1.13
Aon KiwiSaver Russell Lifepoints 2035
3.11
8.28
33.28
-0.03
Aon KiwiSaver Russell Lifepoints Growth
3.09
8.44
34.39
-0.46
Aon KiwiSaver Tyndall Balanced
2.90
6.16
19.70
2.88
ASB FirstChoice KiwiSaver Active Growth Fund
3.49
6.32
27.42
1.54
ASB FirstChoice KiwiSaver Tracker Growth Fund
4.05
7.20
30.17
-0.12
ASB KiwiSaver Growth Fund
4.05
7.21
30.11
0.10
Asteron KiwiSaver Balanced Growth Fund
2.99
7.03
29.08
2.41
Fidelity KiwiSaver-Growth Kiwi Fund
4.12
6.42
24.12
3.66
Forsyth Barr KiwiSaver Growth Portfolio
1.49
4.04
18.25
-
Gareth Morgan Kiwisaver Scheme Growth Fund
2.78
4.60
8.30
-2.10
Huljich Growth Diversified KiwiSaver Fund
-5.32
-4.70
13.46
4.54
ING KiwiSaver - Balanced Growth
2.43
4.88
20.64
1.35
ING KiwiSaver - Growth Fund
2.56
5.32
24.20
-0.14
ING KiwiSaver SIL Balanced Growth Fund
3.17
6.80
24.59
2.65
ING KiwiSaver SIL Growth Fund
3.47
7.69
29.13
1.41
Mercer Super Trust KiwiSaver Growth
3.26
5.61
30.16
0.46
National Bank KiwiSaver - Balanced Growth
3.19
6.72
24.23
2.31
National Bank KiwiSaver - Growth
3.46
7.61
28.73
1.02
Staples Rodway KiwiSaver Balanced Fund
2.68
0.80
22.28
-0.18
Staples Rodway KiwiSaver Growth Fund
3.89
5.38
20.71
1.70
Westpac KiwiSaver-Growth Fund
2.53
5.98
21.52
2.50
Average
2.71
5.81
24.15
1.17





Aggressive
3-month
(%)
6-month
(%)
1-year
(%)
2-year
(%pa)
AMP KiwiSaver Aggressive Fund
1.18
6.22
20.78
-3.38
Aon KiwiSaver Russell Lifepoints 2045
3.07
8.86
37.29
-2.45
AXA KiwiSaver Growth
2.95
7.51
35.12
1.22
Brook Professional KiwiSaver Scheme Growth Fund
3.15
7.12
21.01
6.48
Fidelity KiwiSaver-Aggressive Kiwi Fund
6.30
9.17
33.03
6.21
First NZ Capital KiwiSaver Scheme
3.50
6.16
19.79
-5.94
Fisher Funds Growth KiwiSaver Fund
3.95
9.09
49.31
11.97
Grosvenor KiwiSaver Geared Growth Fund
4.69
7.71
-
-
Grosvenor KiwiSaver High Growth Fund
4.53
7.05
29.66
1.61
Mercer KiwiSaver High Growth
3.46
6.07
35.35
-1.57
Mercer Super Trust KiwiSaver High Growth
3.39
5.96
34.91
-1.68
TOWER KiwiPlan-Growth
4.38
8.38
31.42
0.47
Westpac KiwiSaver - Capital Protection Plan (1)
3.29
7.75
28.21
-
Average
3.68
7.47
31.32
1.18





Single Sector Options



Cash
3-month
(%)
6-month
(%)
1-year
(%)
2-year
(%pa)
AMP KiwiSaver Cash Fund
0.88
1.83
3.80
5.91
ANZ KiwiSaver Cash Fund
0.48
1.00
2.14
-
Aon KiwiSaver ING Cash
0.51
1.11
1.86
-
Aon KiwiSaver Tyndall Cash
0.73
1.47
2.93
5.42
ASB FirstChoice KiwiSaver NZ Cash Fund
0.56
1.16
2.48
4.87
ASB KiwiSaver NZ Bank Deposit Fund
0.56
1.17
2.50
4.85
Asteron KiwiSaver Capital Fund
0.70
1.43
3.25
5.44
AXA KiwiSaver Cash
0.86
1.90
4.40
5.38
ING KiwiSaver - Cash Plus Fund
0.58
1.15
2.50
4.84
ING KiwiSaver SIL Cash Plus Fund
0.43
0.85
1.93
4.25
Mercer KiwiSaver Cash
1.25
2.17
4.01
5.89
Mercer Super Trust KiwiSaver Cash
0.91
1.84
3.50
5.61
National Bank KiwiSaver Cash Fund
0.50
1.02
2.17
-
Staples Rodway KiwiSaver Conservative Fund
0.79
1.62
2.70
4.33
TOWER KiwiPlan-Preservation
0.74
1.55
3.20
5.26
Westpac KiwiSaver-Cash Fund
0.67
1.40
3.15
4.54





Fixed Income
3-month
(%)
6-month
(%)
1-year
(%)
2-year
(%pa)
Asteron KiwiSaver High Yield Fixed Interest Fund
2.15
5.08
9.07
4.86
ING KiwiSaver SIL New Zealand Fixed Interest Fund
2.68
4.77
7.94
5.44
ING KiwiSaver SIL International Fixed Int Fund
1.48
1.90
4.04
7.51
Mercer Super Trust KiwiSaver Fixed Interest
3.94
5.98
20.76
10.01





Property
3-month
(%)
6-month
(%)
1-year
(%)
2-year
(%pa)
Asteron KiwiSaver Global Property Fund
6.01
9.20
65.43
-14.67
ING KiwiSaver SIL Australasian Property Fund
-3.16
-0.86
20.73
-4.84
ING KiwiSaver SIL International Property Fund
6.97
14.29
81.22
-13.03
Mercer Super Trust KiwiSaver Property
3.19
6.87
64.28
-6.34





Australasian Equity
3-month
(%)
6-month
(%)
1-year
(%)
2-year
(%pa)
Aon KiwiSaver Milford
-
-
-
-
Aon KiwiSaver Milford Aggressive Fund
2.79
7.40
22.88
14.53
Asteron KiwiSaver SRI Share Fund
1.96
4.19
29.62
0.48
Asteron KiwiSaver Trans-Tasman Small Companies Shr
3.16
9.82
58.03
6.93
ING KiwiSaver SIL Australasian Share Fund
0.97
4.28
25.65
-0.11
Mercer Super Trust KiwiSaver Trans-Tasman Shares
0.80
3.44
24.51
0.98
Mercer Super Trust KiwiSaver Shares
3.82
6.49
33.96
-3.61
Smartshares Smartkiwi Growth Fund
-0.46
5.29
32.44
-1.66





International Equity
3-month
(%)
6-month
(%)
1-year
(%)
2-year
(%pa)
ASB FirstChoice KiwiSaver Active High Growth Fund
4.09
7.67
30.63
-
ASB FirstChoice KiwiSaver Global Sustainability Fd
6.17
10.03
31.09
-
Asteron KiwiSaver International Share Fund
3.34
7.21
23.32
-4.00
ING KiwiSaver SIL International Share Fund
5.78
10.84
26.02
0.60
ING Kiwisaver SIL Sustainable Growth Fund
3.41
7.71
19.35
-
Mercer Super Trust KiwiSaver Global Shares
5.05
7.66
37.50
-6.09
TOWER KiwiPlan-Equity
5.35
11.12
36.30
-2.73





Miscellaneous
3-month
(%)
6-month
(%)
1-year
(%)
2-year
(%pa)
Fidelity KiwiSaver-Options Kiwi Fund
8.04
12.53
32.81
14.38







Kiwisaver @ Share Investor

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