Yovich & Co. KiwiSaver Market Update - 20 May 2020
May 19, 2020 | KiwiSaver
Wow the markets have had a roller-coaster first and second quarter, and no one really knows what the ride will be like ahead.
From February into mid March most, if not all, KiwiSaver balances contracted from their late 2019 early 2020 highs. Since mid March KiwiSaver balances started to claw back losses. The one year to May rolling return for the OneAnswer Growth Fund is down 1.27%, the Cash Fund has increased 2.07%. It is appropriate to evaluate performance of a KiwiSaver scheme by studying its long-term returns. Over 10 years, the Growth category average has given investors an annualised return of 8.0%, followed by Balanced 6.75%, Aggressive 6.72%, Moderate 5.8%, and Conservative 5.5% (Morningstar). The most important aspect of KiwiSaver is to stay the course and ensure that your fund meets your goals and time frame. As part of Yovich & Co service I have been contacting members to guide them through this volatile market period, if I have not contacted you yet, I will endeavour to be in contact.
Yovich & Co are now offering the SuperLife KiwiSaver scheme to the range of KiwiSaver providers they advise on. This provides clients with the option of choosing an active investing option (OneAnswer KiwiSaver) or a passive investment option (SuperLife KiwiSaver).
OneAnswer KiwiSaver Scheme – Multi-Asset Class*Sourced from: https://www.anz.co.nz/personal/investing-kiwisaver/anz-kiwisaver/performance-fees/ *UPDATED AS AT 31ST MARCH 2020 PERFORMANCE IS AFTER DEDUCTIONS FOR FEES BUT BEFORE TAX AND MEMBERSHIP FEES.
SuperLife KiwiSaver Scheme - Diversified Funds*Sourced from: https://www.superlife.co.nz/kiwisaver-home/ks-returns-and-ees/?gclid=EAIaIQobChMImqDflKay6QIVFh4rCh15hwMREAAYASABEgJ-QvD_BwE#funds-annual_kiwisaver *UPDATED AS AT 31 MARCH 2020. PERFORMANCE IS AFTER DEDUCTIONS FOR FEES AND BEFORE TAX.
- From 1 April 2020 All members aged 65 years or over can now make a retirement withdrawal. KiwiSaver members who joined before 1 July 2019 and were 65 or over at the time would be bound by the five-year membership lock-in period. From 1 April 2020, these members will now have the option to opt out of the lock-in and make a retirement withdrawal. If you do opt out, you will no longer be eligible for Government contributions or compulsory employer contributions.
- A new withdrawal category has been introduced, allowing people with a life-shortening congenital condition to apply to withdraw their savings before the age of 65.
- If Inland Revenue believes your PIR with us is incorrect, they may provide us with an updated PIR for you. We will be required to update your KiwiSaver account with the new PIR. From the 2021 tax year onwards, you will be able to apply for a refund if you believe you have overpaid PIE tax. You will need to contact IR for more information.
- From 15 May 2020, if you’re aged between 18 and 65, your annual account statement may include an estimate of what your balance may be at retirement, both as a lump sum amount and as a weekly income stream for your retirement. The projections are based on assumptions set by the Government.
How we can help
If you need any advice regarding KiwiSaver and/or an Adviser to present at your workplace, the Advisers at Yovich & Co are happy to be of assistance. If you need help with first home KiwiSaver withdrawals we are also the place to visit.
Disclaimer: This publication has been prepared for your general information. While all care has been taken in the preparation of this publication, no warranty is given as to the accuracy of the information and no responsibility is taken for any errors or omissions. This publication does not constitute financial or insurance product advice. It may not be relevant to individual circumstances. Nothing in this publication is, or should be taken as, an offer, invitation, or recommendation to buy, sell, or retain any investment in or make any deposit with any person. You should seek professional advice before taking any action in relation to the matters dealt within this publication. No part of this publication may be reproduced without prior written permission from our company. Disclosure statements relating to the financial advisers associated with this newsletter are available on request and free of charge.
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