Kernel Wealth Launches KiwiSaver Scheme
Kernel Wealth, a New Zealand-based investment company, launched its KiwiSaver plan in May 2022. Kernel Wealth has released only a single fund option for investment, a growth fund. A growth fund a high volatility, high risk investment in the hope of a greater return.
What’s different about Kernel Wealth?
Kernel Wealth is a new provider that launched its KiwiSaver plan and has designed this fund for the purpose of long-term investment, with an emphasis on low fees. However, the fund itself does differ from many others as their fund comprises at least 98% holdings in the form of equities (shares). In comparison, many growth funds hold around 75-80% in equities (shares) and high-growth assets. With such a large holding of the fund in equities, this fund has the potential to see some good returns but, on the contrary, has a large amount of risk attached.
What does this mean for you?
Fees can be a driving factor when choosing a provider, which is very understandable. However, due to the underlying nature of Kernel Wealth’s scheme being solely a growth fund that allocates 98% into equities (shares), they have advised this plan to be for long-term investment (7+ years) as it will likely endure many ups and downs in the short-term due to the nature of volatile growth funds.
Kernel Wealth has only one fund option, growth fund, however they are looking to expand and release conservative fund (low-risk) options shortly, which may better suit some people.
Where Kernel Wealth may not be right for you?
Kernel Wealth fund is a high-growth fund designed for long-term investors and those prioritising low fees. However, if you are looking to buy a first home shortly or are nearing retirement, this fund may not be for you. This is because this fund is directed at long-term investors due to its aggressive investment strategy that potentially may cause your savings to endure more ups and downs in the short term.
How can National Capital help?
National Capital can help inform you on which funds and providers will best suit your specific situation. If you feel unsure about your current situation and KiwiSaver investment fund, you can complete a KiwiSaver Healthcheck. Completing a Healthcheck and taking up ongoing advice tailored to you will allow you to get closer to your financial goals.
For more information about National Capital and its KiwiSaver advisory services, visit www.nationalcapital.co.nz.
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