Financials - related to Fund Managers, etc

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13 years 10 months ago #13811 by Prim
Sooooo, DH said something this morning which has me concerned.

What about his superannuation fund??? It's with Jacques Martin / National Provident, and it's been going a good long time.

His comment was he'd rather pull it out and pay off the mortgage than have none / 50% of the funds. Do we pull it out and pay off the mortgage?

Can anyone give us their humble opinion (here, via PM or email) on what we should consider?

Where do we go to investigate if JM / NP are 'at risk' in this current climate?

We're not well off by any stretch of the imagination, this was an employee subsidised scheme and I've worked hard over the years trying to get DH to NOT discontinue it. It's NOT a kiwisaver scheme.

{mild panic} :(

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13 years 10 months ago #212770 by The Kats Place
At this stage I have left my kiwi saver super sceme and pulled out of everthing else.
Some I won't get till early next year as they were equitable bonds and on a fixed time frame. Anything that was in mortgage funds or globle equities I have instructed my financial planners to quit. I've taken two big hits now in the last 5 weeks and want to cut my losses. I'm please to see the first lot went into the bank over night and the rest should trickle in over the next few weeks with the last few paid out when the fixed time is up.
I'm going to do exacty what you hubby thinks and pay it on the mortgage and the money I put in each fortnight will also go on the mortgage.
I would contact the company and ask a few questions. Like do they lend the funds on first, second or third mortgages

kats
Live your life in such a way that it will be easy for people to say nice things at your funeral [;)]

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13 years 10 months ago #212773 by GrantK

Prim;187035 wrote: Sooooo, DH said something this morning which has me concerned.

What about his superannuation fund??? It's with Jacques Martin / National Provident, and it's been going a good long time.

Prim, according to their web site, the National Provident Fund is government guaranteed:

The NPF superannuation schemes are unique in New Zealand as they are Government guaranteed, which means members can always be sure their benefits are secure.

Further info. is here: http://www.npf.co.nz/content/default.html

Prim;187035 wrote: His comment was he'd rather pull it out and pay off the mortgage than have none / 50% of the funds. Do we pull it out and pay off the mortgage?

Can anyone give us their humble opinion (here, via PM or email) on what we should consider?

Super Funds don't come any safer than that, and given that you are now receiving both Employer and Government subsidies, I would definitely not pull out of it.

NPF has been around for an awfully long time, and is no longer open to new members. Those who are lucky enough to be members, should definitely take advantage of it and remain members IMO :)

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13 years 10 months ago #212775 by The Kats Place
That sound great new for you Prim.

kats
Live your life in such a way that it will be easy for people to say nice things at your funeral [;)]

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13 years 10 months ago #212778 by max2
Interesting to see your thread this morning. I just watched the morning current affair blurb and the same question was posed to the financial TV experts as to whether people should continue to trust super' funds.

They all said, including the man from the investor council, to leave as is, not to withdraw. They are predicting (for aussie super anyhow) decent earnings over the next 9 - 12 months to help offset the past year losses.

Going on Grant's research and advice I would also leave it where it is..... however I am also a big fan of paying down a mortgage ASAP as much as possible (even at an extra $10 per week makes a big difference) so I would possibly consider (depending on the scheme and if your contributions are matched by the other party) perhaps tipping a bit of the current contributions amount into the mortgage additional to the repayment.

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13 years 10 months ago #212789 by Prim
Thanks Grant :) (and swaggie and TKP)

I rang them at 9am and that is what they said, too (government guaranteed). Interestingly I can't find mention of that fact in the meagre paperwork I am holding here on the Fund. Hmmm. But than again, DH is very good at throwing out (or leaving at work) that which I ask persistently for him to bring home. Never mind. I mean, it certainly does say that on the web so it must be true! (tongue in cheek people, tongue in cheek)

I've been so sorry to read of your loss, TKP, and Louise's g/father, and hmm, there was someone else, wasn't there? Oh my gosh, I don't know how I would feel :confused:

Swaggie, we are trying to do 'all things right'! We're a single income family (I have chosen to stay home with kidlettes) but we're paying more than we 'need' to on the mortgage, paying into super and we also have little accounts for the kids (v little). I am a financially insecure person so I kinda like the spread, but having said that if anything happens to ASB we're stonkered. We often talk about our first home (as opposed to this, our second) - had we stayed where we were we'd have long been mortgage free. {sigh} But then again, could we have survived mentally and emotionally in the very small, two bedroomed home that it was?! Regardless, we're here now, and plugging away.

I do look at the situation in America and wonder if now would be a good time to try and invest (independently of fund mangers etc) in property over there. Although the exchange rate is changing daily, just a while ago we were getting US$0.78 for NZ$1. I think that's pretty good (!), and there are so many homes on the market over there! But, then again, you'd still need to get someone to rent them at an acceptable price, and that may be a struggle.

Anyways, I'm now a lot less panicked than I was - thank you!!! {phew} [:I]

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13 years 10 months ago #212794 by max2
Replying as follows:

Prim;187066 wrote: Thanks Grant :) (and swaggie and TKP)

I rang them at 9am and that is what they said, too (government guaranteed). Interestingly I can't find mention of that fact in the meagre paperwork I am holding here on the Fund. Hmmm. But than again, DH is very good at throwing out (or leaving at work) that which I ask persistently for him to bring home. Never mind. I mean, it certainly does say that on the web so it must be true! (tongue in cheek people, tongue in cheek)

I've been so sorry to read of your loss, TKP, and Louise's g/father, and hmm, there was someone else, wasn't there? Oh my gosh, I don't know how I would feel :confused:

Awful for those isn't it? My FIL and MIL worked very hard to get their savings as well, and they were careful, lived very frugally, and if they were around today, they too would have lost some money.

They are not the sort to be able "to afford to lose" and I hate that term applied to people who have managed to scrape a bit of savings together by being careful and doing the right thing. It irks me to think though that the Directors are walking around having taken millions from the business over a relatively short term period, and they and their "blondes" won't be going without.....[}:)] [}:)]

Swaggie, we are trying to do 'all things right'! We're a single income family (I have chosen to stay home with kidlettes) but we're paying more than we 'need' to on the mortgage, paying into super and we also have little accounts for the kids (v little). I am a financially insecure person so I kinda like the spread, but having said that if anything happens to ASB we're stonkered. We often talk about our first home (as opposed to this, our second) - had we stayed where we were we'd have long been mortgage free. {sigh} But then again, could we have survived mentally and emotionally in the very small, two bedroomed home that it was?! Regardless, we're here now, and plugging away.

Good on you, hard work though eh!

I do look at the situation in America and wonder if now would be a good time to try and invest (independently of fund mangers etc) in property over there. Although the exchange rate is changing daily, just a while ago we were getting US$0.78 for NZ$1. I think that's pretty good (!), and there are so many homes on the market over there! But, then again, you'd still need to get someone to rent them at an acceptable price, and that may be a struggle.

I have an email penfriend in La Porte Indiana. She has a rental as well as her own home, and has (same as any where in the western world) own batch of problems with tenants, some good, some not so good.

However we see in both Aussie and NZ american property advertised and their houses look smart compared to our "standard" 3 bedder... anyhow there are streets of empty houses and they cannot sell these to the locals for a variety of reasons.

I have a rental in NZ and I find it hard enough to manage and cope with that at times, charges for repairs, trying to get work quoted via the PM, finding good tenants and keeping tabs on what the PM is actually doing... my house is vacant and yet doesn't appear on trademe or the agency website [}:)][}:)][}:)][}:)].
There are going to be some sore backsides fairly soon.... so using my current experience, its difficult being "so" far away and I wouldn't recommend it unless you have family nearby that can assist.

Just my thoughts. PM me if you want to talk about it further....

Anyways, I'm now a lot less panicked than I was - thank you!!! {phew} [:I]

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13 years 10 months ago #212819 by NZ Appaloosas
Problem with investing in property in the US may well be the mortgage situation. Unless you have the funds to purchase in cash, that is.

Something else to consider--prices fluctuate wildly between states and within states, depending on locale. "Cheaper" does not automatically mean "worse" by way of locale, quality of property, etc. So if someone has the wherewithal to go spend time over in the US, researching properties (and really good, competent property managers), it might be a good move.

Diane


Featuring Wap Spotted, sire of the first Wap Spot 2 grandget in Southern Hemisphere and New Zealand

On the first day God created horses. On the second day He spotted the best ones.

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13 years 10 months ago #212857 by GrantK

Prim;187066 wrote: I do look at the situation in America and wonder if now would be a good time to try and invest (independently of fund mangers etc) in property over there. Although the exchange rate is changing daily, just a while ago we were getting US$0.78 for NZ$1. I think that's pretty good (!), and there are so many homes on the market over there! But, then again, you'd still need to get someone to rent them at an acceptable price, and that may be a struggle.

Yes Prim, I hear what you are saying regarding the exchange rate. But there is another way to take advantage of the currently high NZ$ vs. US$ exchange rate without going through all the hassle of owning property, finding tenants, organising repairs etc as Swaggie has mentioned.

When we sold our business at the end of March, we had quite a large sum of money which was due to be paid in US Dollars by a major customer. Most of the currency for this deal had been purchased at US$0.80 or above.

I believe, as you do, that the NZ$:US$ will not stay at these levels for ever and so rather than convert the money back into NZ$ at an unfavourable exchange rate, I have chosen to leave with funds in US$ which is invested in a Foreign Currency Account at Kiwibank.

Such accounts pay very little interest (currently around 1%) compared to NZ$ Call Accounts which can pay over 8%. However, we are looking for a gain on the exchange rate, rather than interest, and given that the NZ$ is now trading in the 74c range vs. 80c when we bought the funds, we have already made a tidy profit. All of which could evaporate if I have read the market wrongly, but I have done my homework on this one, and am prepared to wait several years if necessary for a more favourable exchange rate at which to convert the funds back to NZ$.

Effectively, this investment is making a bet on the future value of the exchange rate, which is a risky business, and so is not for everybody. I would certainly not recommend putting too large a percentage of your portfolio into such an account as it is even more risky than shares.

However, for someone who is comfortable with that risk, it is another type of investment which can be considered. Some people trade foreign currencies for a living, but I would never want to do that, because I wouldn't sleep at night.

The US$ is extremely unlikely to ever be worth nothing, and Kiwibank is a reputable bank with a good credit rating, so I cannot see any scenario under which I could lose my entire investment, although it is certainly possible that I could lose a percentage. It's a risk I'm willing to take, given the circumstances.

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13 years 10 months ago #212865 by reggit
It certainly makes you look at where you have put your super...mine is in Axa, but the policy is owned by New Zealand Permanent Trustees Ltd which is apparently wholly owned by Public Trust. Fingers crossed [:I].

We didn't take out a special super plan for hubby as I am not that impressed with mine. We put the same amount as goes into mine each month into PSIS for him, and though he started his a few years after mine, those PSIS term deposits have now well and truly overtaken my super balances - much better performance, esp not having to lose a cut to the 'fund manager' fees as I do with mine [:(!]

Take a break...while I take care of your home, your block, your pets, your stock! [;)] PM me...

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13 years 10 months ago #212969 by Jack
Gidday

If you find any investment that pays you a greater interest than you have to pay on your mortgage then it will have a hellava lot less security than you will have in a freehold home.

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13 years 10 months ago #212975 by The Kats Place
I hear you Jack:o

kats
Live your life in such a way that it will be easy for people to say nice things at your funeral [;)]

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13 years 10 months ago #212979 by reggit
It would be interesting to know the difference between what was paid out on those funds to investors compared to what was charged on the money loaned out...bet there was one helluva margin in between that was taken by the middleman, as it seems to me that payouts were nowhere near commensurate with the risks being taken with peoples' money...:(

Take a break...while I take care of your home, your block, your pets, your stock! [;)] PM me...

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13 years 10 months ago #213082 by max2

tigger;187269 wrote: It would be interesting to know the difference between what was paid out on those funds to investors compared to what was charged on the money loaned out...bet there was one helluva margin in between that was taken by the middleman, as it seems to me that payouts were nowhere near commensurate with the risks being taken with peoples' money...:(


About 4 years or so back Tigger, our NZ beneficiary family member was borrowing from finance companies at 28% and she wasn't being particularly truthful about her "incomes" to get the finance deals either...

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13 years 10 months ago #213366 by Prim
I'm pleased I asked my question, b/c I've enjoyed reading the replies and learning what I have this week! Grantk, you're a huge mine of information - I will have a look at that foreign currency account with Kiwibank. Thanks!

Overseas investment is just a pie in the sky thing for us presently. But some of the land I've seen - huge chunks of land - and the very little prices ... wow! Regardless, thanks for all your comments. It has been appreciated :)

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