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KIWISAVER

Will you ever be able to afford that house!!!

KIWISAVER---- WE NEED TO SAVE SURE!!!!!!

But whats the future look like for those already heavily committed

  • First-home subsidy--how can one imagine buying a $380,000 home in Wellington when RVs will increase???
  • After three years of saving, KiwiSaver provides a first-home-deposit subsidy of $1000 each year you're with KiwiSaver, up to a maximum of $5000. Not everyone will be eligible for the subsidy. There will be eligibility criteria but you can make a one-off withdrawal to put towards your first home after three years' saving with KiwiSaver. Some schemes may offer a mortgage-diversion option after 12 months in the scheme, half of your regular contribution can go towards paying off the mortgage on your home.
  • New rules mean you lose $40 a year fee subsidy, so now you have to pay all your fees yourself---could this increase as providers find its not enough each year to run their business----many say nothing about this & what will they onvest your hard earned cash into --- so best use government funded providers or Banks for security sakes & remember a provider who offers you more will normally have a hidden agenda?
  • Most KiwiSaver schemes are balanced managed funds so check out their FEES AND FUTURE FEES - your money is pooled and placed by a professional manager in a variety of investments (such as cash, shares, bonds, and property).I would opt for a Bank eg. ANZ which is guaranteed as some of these providers may invest in the wrong investments??? then what?
  • Do you know where your fees are being invested? if not ask as 60% are invested overseas & if the bubble bursts then so does your kiwisaver investment?

 

   

 

ANZ is the biggest KiwiSaver provider in New Zealand

with just under a quarter of the market----- but is NOT NZ Govt guaranteed?????.

A comprehensive survey compared the funds under management for all KiwiSaver providers. 212,732 members and $523 million (as at March 31) across the four schemes it manages – the ING default scheme, ANZ, National Bank and SIL. ANZ says it has negotiated the right to use the ING brand for 12 months so ANZ has a good head start in the wealth management market so for those who wish to join best use a Bank for secuirty like ANZ . But is it security? will the Bank hike up the fees etc?

Kiwisaver is designed to help people save for their retirement. Its also a way for the Government to either reduce the retirement benefit if enough join, or in fact cut the benefit right down with a ceiling on the eligible age under a grandfather amendment. Kiwisaver is a way for people to start saving for retirement as buying cars etc is not and even a mortgage today will not cover what the house is worth once paid off. Remember the old saying if you borrow $10,000 from the bank ---double it--then half it again and thats right $25,000 you pay back immaterial of the interest and inflation rates. ALWAYS REMEMBER THIS AS YOUR FORMULA. So if you think paying a house off is an asset in fact it can be a never ending burden so the more you save the easier it becomes but on todays market with house prices increasing once again on the gravy trail theres little hope for those borrowing $300,000 plus. For many in 2010 its now a need to be forced to save for their retirement, but they are also allowing those who can afford it, the wealthy, to put their non working spouses into the scheme and invest $1,042.86 per annum and get the full tax credit of $1,042.86. It also favours well with the high age bracket retirees as gives them an extra handout by the government. It certainly doesn't help those on the breadline and nothing will help this lower working bracket as the cost of living now outweighs any salary for single income earners with small families who are renting with not enough equity to buy their own home unless lotto prevails in their favour.

Those with mortgages in August 2010 will now worry as the Reserve Bank lifts the interest rates and floating mortgages cost a little more. It is time for District Councils to start loosening up on consent and costs and the staff levels by axing departments deemed unnecessary. Think of Levin a small provincial town with 33-35000 people in their electorate & a large Council building in over budget mode and feeding around 95 staff?? In Taupo which is bigger than Levin the staff levels are far less & the Councilk building a pittence. Levin owes plenty for their building. This is what I mean about properties & costs based on RV Rateable valuations. The higher your valuation the more rates you pay. This has lead to a dramatic increase in property values well above what the property is really worth. What the values are based on is the costs associated with running a District Council budget which are all over the top and need to be more streanlined. Recently the cases of CEOs & Mayors having a good time on the taxpayer credit cards.

LOWER INCOME FAMILIES & SOLUTIONS:

Meanwhile kiwi households are dissaving -- spending beyond their means by 14% (Reserve Bank) trying to stay alive. As goods and services increase so will the cost of living expenses but not so salaries. For those with no savings, no home of their own & one salary in the family with young children there is no hope at all as inflation will outweight anything they wish to save for in their future. Not only that the cost of buying ones first home is now well out of reach for anyone on a single income over age 45yrs unl;ess they have over 60% equity in cash. RVs from District Councils are over the moon and property values beyong imagination so anyone wishing to borrow are themselves in a debt situation before they start.They will indebt their children as the repayment costs have now tripled from 10 years ago & the loan repayments one has to pay will tighten to the point of insolvancy. So whats the answer--- pooling ones resources with families is one way to help each other. Easy to say yet hard to imagine but its a way to achieve ones goal if established right. Of course we all want to win lotto then problerm solved but this is a game of chance. Maoris can do this using Maori Lands & their Tribal Iwi Management but it depends on the tribal Trust that have this in place. Rentals have increased with 3 bedroom homes around $200-250 per week. This is indeed hard for lower income families. Some live in holiday parks in Caravans etc a way that they can save a little but then the initial price to buy their caravan has risen also? but its a start. To build a new home even a small home the consent will hit you around $20,000 before you lay the foundation if you own the section -- if not then again its going to be tough. Apart from State Homes theres not much else one can do. TINZ. (this is NZ).2010

In favour of Kiwisaver just remember theres many new companies acting just like finance companies and you will not know what they do with your funds until they actually say they have no funds left. Be careful if you use these companies as its just another finance company in the making.

.KiwiSaver, just like any other investment, is risky and is not Government guaranteed. KiwiSaver schemes have been set up by both small and large "finance" companies---does this make sense.

HERES THE DANGER:

  • 2012: What if your funds are being used by Banks for Rehypothecation purposes as has happened to MF Global & Hedge funds where your funds are now susceptible to being reinvested?? Do you know what this is will if not read this [ Check this out ]

 

[ Recession 2012 ] [ Whats Rehypothecation -mortgages 2012 ] [ Whats a reverse mortgage?? ] [ Banks & Subprime Mortgage ] [ Banks are loan sharks ] [ Failed Finance Companies July 2010 ] [ Finance Report 2010 ] [ Property Report May 2010 ] [ Buying Mortgagee Property Tips ] [ MF Global bust 2012 ] [ Kiwisaver good or bad Providers ] [ Bank Lending Report 2010 ] [ George Soros Mortgage answers March 2010 ]

"I hope they don't change the Kiwisaver rules anymore "

 
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