NZ Managed funds?

Discussion in 'Shares & Funds' started by Cmelderis, 8th Jan, 2020.

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  1. Cmelderis

    Cmelderis Well-Known Member

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    Hello fellow PC'ers,
    My partner has some inheritance money sitting in a NZ bank account that we would like to invest in a managed fund or similar.
    Does anyone here hold shares in the NZX?
     
  2. JohnPropChat

    JohnPropChat Well-Known Member

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    Is there a NZ version of superannuation?
     
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  3. SatayKing

    SatayKing Well-Known Member

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  4. Cmelderis

    Cmelderis Well-Known Member

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    We would want to extract the money in say 5 or so years to purchase a house there
     
  5. Cmelderis

    Cmelderis Well-Known Member

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    bumping this in the hopes someone has some advice
     
  6. JohnPropChat

    JohnPropChat Well-Known Member

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    NZ doesn't have CGT and stamp duty right? Why not just buy a good property now (with leverage if possible) and sell 5 years down the track to fund the next purchase?
     
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  7. Cmelderis

    Cmelderis Well-Known Member

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    Borrowing is so hard there! I think you need min 30% deposit. House prizes in NZ cities is also insane! We want to buy on Waiheke Island in the future as thats where my partner grew up....we would need 150k deposit based on 30% for even the crappiest of shacks
     
  8. Cmelderis

    Cmelderis Well-Known Member

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    Bumping this again in the hopes someone has some experience in the NZX? I am looking for an ETF so far my research has lead to to Milford Milford Asset Management I Investment Specialists a few family members there use these guys but the fees seem high?
    https://smartshares.co.nz/ fees seem lower
    https://fisherfunds.co.nz/ also high fees
    Vanguard doesnt seem to be an option https://www.vanguardinvestments.com...lesale/portId=8102/assetCode=equity/?overview
    However did find this reddit thread which states you can use Invest Now to purchase vanguard in NZ so will do some further research https://www.reddit.com/r/PersonalFinanceNZ/comments/7n76rv/vanguard_in_nz/
     
  9. mtat

    mtat Well-Known Member

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    Have a look through this forum on New Zealand investing:

    Non-US Investing - Bogleheads.org
     
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  10. Cmelderis

    Cmelderis Well-Known Member

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    Thank you, also have posted on Reddit in the NZ Personal Finance group. Hopefully will get some insight.
     
  11. Pier1

    Pier1 Well-Known Member

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    Silly question, why does it need to stay in NZ
    Withdraw money from NZ bank acc and purchase what you want
     
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  12. The Falcon

    The Falcon Well-Known Member

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    Yes I don’t follow the logic here. 5 years is a long time and FX is cheap. Convert to AUD and TT to Australian account. Deploy as desired. In 5 years revisit.

    If AU tax resident you need to report all foreign earnings anyway (interest, income, capital gain) and are subject to Australian tax.
     
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  13. Cmelderis

    Cmelderis Well-Known Member

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  14. Cmelderis

    Cmelderis Well-Known Member

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    Actually.....looking at this table I might just go with all AUS etfs a mix of a few
    Smartshares - A member of the NZX Group.
     
  15. Cmelderis

    Cmelderis Well-Known Member

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    Thanks, looking further into this and it does seem way more complicated to do this in NZ when we are here.....would he be paying double tax? I have tried researching but it is a bit of a brain fry. My research directs me to trans tasman imputation rules but these seem aimed at companies not individuals :confused:
     
  16. Cmelderis

    Cmelderis Well-Known Member

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    And now one of the investment companies our family in NZ use and recommend have come back to me with this reply when I asked about tax:

    Some of the securities held in the fund do pay dividends however, these will be taxed at the fund level. Our funds do not pay dividends, we do have 5 funds that pay distribution payments however, distribution payments are non-taxable events. You therefore would not need to declare any income on your tax return. The 4 income orientated funds pay quarterly distributions (Trans-Tasman Bond Fund, Global Corporate Bond Fund, Conservative Fund and Diversified Income Fund). The Trans-Tasman Equity fund also pays out a distribution however, is a semi-annual payment. The distribution amount is determined on a cents per unit basis. This is an amount determined by the fund manager as an amount appropriate relative to the income generated from securities in the fund (e.g. dividends from shares, interest payments from bonds etc). As fund managers, we do not want to pay distributions that are higher than the income we receive. We only look to pay an amount that is appropriate relative to these income payments, if we paid an amount that was higher than this we would rely on paying out some of the capital appreciation returns along with the income generated, which is not our preferred long term approach due to capital appreciation being far less predictable. You can find further information on distributions on page 4 of the attached Investor Guide. I have also noted the distribution amounts below:

    Conservative Fund .5 cents quarterly
    Diversified Income Fund 1.1 cents quarterly
    Trans-Tasman Bond Fund .45 cents quarterly
    Global Corporate Bond Fund .45 cents quarterly
    Trans-Tasman Equity Fund 1.5 cents quarterly

    I do know family members that use this fund have averaged 7% growth pa however it seems like the income derived is not even worth mentioning
     
  17. inbaaa

    inbaaa Active Member

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    Hi @Cmelderis

    My parents (both retired, and dad on NZ age pension) in NZ are in similar situaiton as yours with a spare NZD30k which they're looking invest for income. They've been having NZD30k in Term Deposits till now and it's, unsuprisingly, resulting in spare change as interest. From what I've read so far, I am leaning towards Smartshares (mix of dividend focussed ETFs - DIV and ASD). I understand both DIV and ASD will pay dividends to my parent's bank account which should be more than 1.5% interest rate they'd get from a Term Deposit.

    Just interested to know your views on this and if you dont mind sharing - how you went investing your NZD30K?

    Many thanks,
    Inba
     
  18. Cmelderis

    Cmelderis Well-Known Member

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    Hi Inbaaa,
    One of the other PC'ers sent me some really good info I can send to you. As my partner doesn't have a residential address in NZ we are limited with who we can set up accounts with so I believe he is going to go with Milford but this wouldn't be my pick for your parents as their fees are high and they also take a performance fee if they outperform. I believe your parents would be better off with Smartshares as you say. I also did some research on reddit that was helpful.
     
  19. inbaaa

    inbaaa Active Member

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    thanks @Cmelderis. I am of the same opinion too - going with Smartshares. I'd been keen to read through the info sent by fellow PC'ers. Could you please share that with me? thanks!
     

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