Research reveals top Kiwi Saver funds
Research reveals returns from KiwiSaver funds
Research has revealed which KiwiSaver funds have made the biggest dollar returns f or savers in the past five years, taking into account fees and investment performance.
Australian research f i rm SuperRatings based its analysis on a person earning $50,000 who already had $20,000 saved in a KiwiSaver account at the start of the five years and contributed at a rate of 3 per cent per year with 17.5 per cent tax.
It then factored in the actual fees charged and investment returns of that specific fund.
Milford Asset Management’s growth KiwiSaver fund topped the growth category, delivering $20,395 in net benefits to investors in the past five years.
Its nearest competitor, the OneAnswer KiwiSaver scheme run by ANZ bank, gave a net benefit of $ 15,091, f ollowed by t he Aon KiwiSaver scheme which gave $14,975.
The net benefit to those invested in growth funds was nearly double that of those in the lower-risk conservative category, where much of New Zealand’s KiwiSaver money sits.
The best of the conservative funds was the Aon KiwiSaver scheme’s, with a net benefit of $8164. Second was the SuperLife KiwiSaver scheme’s conservative fund, which gave $7182, followed by the Fisher Funds Two KiwiSaver fund (the former Towerrun default scheme) — conservative, whose net benefit was $6597.
SuperRatings chief executive Kirby Rappell said the range in the net benefits showed some providers making a real difference to members’ balances.
“It is also important to point out that some of the funds with high net benefit values are not necessarily those offering the lowest fees.”
The fees versus investment returns debate has been running hot in the industry with the entry of lowcost KiwiSaver provider Simplicity into the market. It has only been running for a year, thus its data is not included in the research.
Government and industry regulator the Financial Markets Authority has also been focused on fees.
Next year KiwiSaver providers will have to give the dollar value of the fees they charge in their annual members’ statements which come out about April and May.
This led the New Zealand Shareholders Association to warn that people would just compare the dollar amount of their fees without taking into account how much money they had in their KiwiSaver accounts. The saved amount is important because a large portion of the fees is a percentage charge that is based on this.
The association wants both the dollar amount and the percentage figure to be in the statement.