Simplicity goes beyond KiwiSaver
Non-profit provider to open standard funds.
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Hawke’s Bay
KiwiSaver provider Simplicity is moving into the open market for investment funds with the launch of three unit trusts.
Simplicity founder Sam Stubbs said the new funds would have the same low fee, passively managed features as its KiwiSaver funds.
“Fees for KiwiSaver funds are already far too high, and managed investment schemes are even worse. Some are just outrageous, reflecting old ways of managing money and sales tactics which belong in the last century,” he said.
“As a non-profit, 100% online manager, we are here to provide easily understood, diversified funds to ordinary Kiwis, so they can increase their wealth. It’s as simple as that.”
The three funds – growth, balanced and conservative – will carry fees of 0.3% of assets and will screen out investments in tobacco, nuclear weapons, mines and cluster bombs.
The overseas investments will be managed by index fund giant Vanguard. The funds will not pay dividends. The minimum initial investment is $10,000.
Mr Stubbs said the funds would open to investors on April 3 and aimed to save an investor with $50,000 about $13,000 over 10 years.
“Managed investment schemes are a $40 billion market,” he said.
“We think the average management fee is about 1.6% in those funds, which means there is about $640 million taken out in fees.
“We hope to get 10% of that market in five years.”
As of March 3, Simplicity’s website says it had 3531 KiwiSaver members and $91 million under management.
Staff Reporter
Mon, 06 Mar 2017
Mon, 06 Mar 2017
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Simplicity goes beyond KiwiSaver
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