Forum Home
PC World Chat
Thread ID: 80628	2007-06-29 23:36:00	Kiwi Saver	Myth (110)	PC World Chat

Post ID	Timestamp	Content	User
564488	2007-06-30 07:57:00	The major factor that is making me hesitate is the state of the housing market: I will be looking for a house sometime between the next 1 - 3 years. However, house prices (especially here in PN) having been rising steadily for some years, and show no sign of slowing down (from my observations). If I sign up to kiwisaver, I get the advantage of an extra $3000 towards the deposit, plus being able to withdraw contributions made up to that point. That would be a big help. Trouble is, the minimum period before you can draw down that $3000 plus contributions is 3 years, in which time the housing market could have shot up even more, and the house that is only just affordable now would be well out of reach in three years time, even after the extra money contributed by kiwisaver. On the other hand, if I scrimp and save on my own, without kiwisaver, for the next 12 months, I'll be stretching the limits for an acceptable deposit on a house. If it's not enough, and I have to keep saving, then it may have been better to jump into Kiwisaver and commit to renting for at least another 3 years. Trouble is, the whole thing rests on what the housing market does, and even the best financial adviser is not going to be able to predict house prices in 1 - 3 years time, so I'm torn between being patient and praying for lower or static house prices in 3 years time, or accepting that house prices are as low as they're likely to be, and jumping in at the earliest opportunity. Having said that, I'll be joining Kiwisaver as soon as I've got a house sorted and payments stabilised. Careful b/c there are items to be eligible for the mortgage. I think Auckland has a top price of $300k, and the rest of country $200k. I think there is also things like if you have more than one person on Kiwisaver that ceiling can be raised up so you can buy a more $$ house. Also be aware not all providers will allow you to put 50% of the kiwisaver into the mortgage but I think all should be able to give you $3k or $5k for the mortgage but again it needs criteria, you cannot buy an expensive place. I think the criteria is governed by Housing NZ or something..	Nomad (952)
564489	2007-06-30 08:04:00	I read a article by Consumer and the results are backed up by financial adviser and author Gareth Morgan. That is if you get a 9% return after tax and fees and inflation you may only get 3 or 4%. 2/3 goes to the provider. If you had a hard year in the financial market, you could even lose money - even on a medium risk balanced portfolio. The summary was managed funds tend to give pple 2% return after fees and inflation in the long term but all the providers examined under Consumer (and then by Gareth Morgan) found that bank's term investment rates were all higher than balanced portofolio's regardless if you had that from a finc company or a bank who sold you managed funds. If you go into it, get the investment statement, prospectus and the trust deed. I tried to get the latter 2 but the guy just sent me another same flashy brochure - investment statement. They just don't want to provide that info to you, some will charge you 20c a page as in the back of the investment statement or they charge you $50 or some will say "reasonable fee" but then the question becomes what is reasonable. Some will give it to you free only when you already joined up. Warning you also get entry fees and exit fees, fund mgmt fees and trustees fees and any service fees they go via .. if you get a fund like AMP which has funds that is not AMP inside it .. AMP may charge a fee and then the other company inside may charge their fee .. I learnt some at gmk.co.nz and go to the library and read Consumer Magazines. The website will let you know which edition you can find various articles..... Take a step back. In a bank you get a % rate for their interest for placing your money there. Cool. But with fund management, the fees are not derived from that. In otherwords the % for fees is not for the amount of money that has grown it is for the whole balance. Ie.. if they charged 2% for fees. If you had $100. Let for simplicity it doubled. You get $100 more, so you get $200 total and less $4 for fees. If you had $100 and it fell to $50. You end up with $50 and still have to pay your fee of $1. You end up with $49. This is assuming there are no other fees. If you read the prospectus or the deed, it will say these are our fees but our service charges has no limits of what they can charge you. I read one and it gave me an example of just over a page of bullet points and said this is not a complete list or shall be limited to .... Its also written so the avg person finds it hard to understand. I had a balanced portfolio which I cancelled. When you get your statement this may be online or not online and so maybe each yr or each 3 months, where it tells you the bills or fees, it does not disclose them. On mine all it said was Net and Gross and Imputed Credit which I found was taxed at the end. It does not give you an outline of the fees and where has gone to where and where....	Nomad (952)
564490	2007-06-30 08:06:00	The major factor that is making me hesitate is the state of the housing market: I will be looking for a house sometime between the next 1 - 3 years. However, house prices (especially here in PN) having been rising steadily for some years, and show no sign of slowing down (from my observations). If I sign up to kiwisaver, I get the advantage of an extra $3000 towards the deposit, plus being able to withdraw contributions made up to that point. That would be a big help. Trouble is, the minimum period before you can draw down that $3000 plus contributions is 3 years, in which time the housing market could have shot up even more, and the house that is only just affordable now would be well out of reach in three years time, even after the extra money contributed by kiwisaver. On the other hand, if I scrimp and save on my own, without kiwisaver, for the next 12 months, I'll be stretching the limits for an acceptable deposit on a house. If it's not enough, and I have to keep saving, then it may have been better to jump into Kiwisaver and commit to renting for at least another 3 years. Trouble is, the whole thing rests on what the housing market does, and even the best financial adviser is not going to be able to predict house prices in 1 - 3 years time, so I'm torn between being patient and praying for lower or static house prices in 3 years time, or accepting that house prices are as low as they're likely to be, and jumping in at the earliest opportunity. Having said that, I'll be joining Kiwisaver as soon as I've got a house sorted and payments stabilised. If you got debt ie .. a mortgage or credit card debts your likely be better off paying those off quickly as you can than go into the Kiwisave scheme. I mean the return from any investment after fees and after tax and after inflation is not going to beat the loan interest rate. You are not going to get a consistent yr after yr 12% payoff rate and then pay your tax and fees and still have 8-9% PA yr after yr to match your loan rate (to breakeven).	Nomad (952)
564491	2007-06-30 08:22:00	Look at the prospectus it will tell you in fineprint where the money can be lent to or used to. Such as companies that is affiliated by the trustee or fund managers themselves .. great read with Consumer Mag - re: Money Managers branches in NZ, they can be loaned to pple /orgs with or without security. Some may even say, loaned to pple with lesser social economical status where they are unable to get loans from banks. Nothing wrong legally but how risk taking are you and how safe is the whole org doing a practice like that? To me fund mgmt is hidden fees, high fees, things that is undisclosed. Yeah they may give you the equations but they don't tell you the unit prices via your transactions.... so you have no way of calculating it yourself anyway.	Nomad (952)
564492	2007-06-30 08:56:00	:angry Stupid KiwiSaver will affect my investment plans. $20 per week is a lot of money, man, I could buy more HDD with that kind of money why bother using KiwiSaver? HDD is a better investment plan.	PedalSlammer (8511)
564493	2007-06-30 09:26:00	FYI: To be eligible for the first home deposit subsidy, you must: * Be a member of a KiwiSaver scheme, or a complying superannuation fund * Have a household income (before tax) of less than $100,000 per year (for one or two people), or less than $140,000 per year (for more than two people) * Be purchasing a lower-quartile priced home . (As an example, currently this is $400,000 for higher priced areas such as North Shore City, Auckland City and Queenstown Lakes District, and $300,000 for the rest of New Zealand) . The eligibility criteria relating to the income caps and regional house price caps will be reviewed in 2009 before the policy takes effect . What is the maximum household income? You can have a maximum household income of $100,000 per year if it is for one or two KiwiSavers . You can have a maximum household income of $140,000 per year if it is for three or more KiwiSavers . What are the house price caps? There are two different house price caps . One cap is for people living in the country's most expensive areas, and the other is for the rest of the country . The deposit subsidy is not designed for people living in less expensive regions who want to buy expensive houses . The regional house prices caps are based on current lower quartile house price figures and can vary . Housing New Zealand Corporation will set the lower quartile house price figures in 2009 and review them annually from June 2010 .	Nomad (952)
564494	2007-07-01 23:15:00	when ur automatically enrolled,how much pay do you get deducted per week? Is it 4% a year of ur pay by default? Who's employer has given them a form today?	lance4k (4644)
1 2