This article was originally published on March 6, 2017.
About an hour ago, KiwiSaver provider Simplicity announced that they were introducing new investment funds.
I was ridiculously excited when I heard this news – as you know, I’m a huge Simplicity fanboy (possibly a huge understatement).
What does this mean for investors?
Kiwis have over $40 billion dollars in managed funds.
Most of these funds charge huge fees which eat into your money like crazy over the long term.
But Simplicity are now offering three new ethical, low-fee funds for the lucky investors of New Zealand.
According to Simplicity, this was a service they’d been planning to offer sometime in the future, but they bought it forward due to demand. It’s awesome to see Kiwis realising the power of passive investing.
What’s in the new funds?
Simplicity has three funds available which mirror their KiwiSaver funds. They’re Conservative, Balanced and Growth, with Growth having the largest amount invested in shares.
Just like with their KiwiSaver funds, these new funds don’t invest in any nasties (cluster bombs etc) and 15% of the fees go to charity.
What are the fees?
Simplicities new funds charge the exact same fees as their KiwiSaver funds; 0.31% + $30 per annum. This is way lower than the average managed fund. Big wins all round!
Unfortunately, the minimum investment into any of these funds is a fairly hefty $10,000.
I can understand why this is, it’s very expensive to manage a lot of small accounts. But it does kind of suck for anyone out there who don’t happen to have $10,000 just floating around the house – it means it’ll probably be a long time before you could get involved with these funds.
Hopefully, once Simplicity grows bigger, that number will come down and make everything way more accessible.
Personally, I’m really interested in these funds and am strongly considering investing. I’ll be following them closely over the next wee while.
What do you think about Simplicity’s new funds? Are you keen to invest, or disappointed by the high minimum investment?
To read more on this, you can check out their press release here!