Investment statement Dated 17 September 2013
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Investment Statement Dated 17 September 2013
1
Investment Statement
Date 17 September 2013
IMPORTANT INFORMATION Choosing an investment
(The information in this section is When deciding whether to invest,
required under the Securities Act 1978.) consider carefully the answers to
Investment decisions are very
the following questions that can be
important. They often have long-term found on the pages noted below:
consequences. Read all documents What sort of investment is this?.............. 10
carefully. Ask questions. Seek advice
before committing yourself. Who is involved in providing it for me?.... 17
How much do I pay?................................. 20
What are the charges?............................. 26
What returns will I get?........................... 29
What are my risks?.................................. 33
Can the investment be altered?............... 40
How do I cash in my investment?............ 43
Who do I contact with inquiries about
my investment?........................................ 48
Is there anyone to whom I can complain
if I have problems with the investment?.. 49
What other information can I obtain
about this investment?............................ 50
In addition to the information in this
document, important information can be
found in the current registered Prospectus
for the investment. You are entitled to
a copy of that Prospectus on request.
Investment Statement
Questions about this information? Call 0800 427 384 or email questions@gmk.co.nz2
The Financial Markets A financial adviser who provides you with
personalised financial adviser services
Authority regulates conduct
may be required to give you a disclosure
in financial markets statement covering these and other
The Financial Markets Authority matters. You should ask your adviser
regulates conduct in New Zealand’s about how he or she is paid and any
financial markets. The Financial conflicts of interest he or she may have.
Markets Authority’s main objective Financial advisers must have a complaints
is to promote and facilitate the process in place and they, or the financial
development of fair, efficient, and service provider they work for, must
transparent financial markets. belong to a dispute resolution scheme
For more information about investing, if they provide services to retail clients.
go to http://www.fma.govt.nz So if there is a dispute over an investment,
you can ask someone independent to
resolve it.
Financial advisers can help you
make investment decisions Most financial advisers, or the financial
service provider they work for, must also
Using a financial adviser cannot be registered on the financial service
prevent you from losing money, but it providers register. You can search for
should be able to help you make better information about registered financial
investment decisions. service providers at http://www.fspr.govt.nz
Financial advisers are regulated by the You can also complain to the Financial
Financial Markets Authority to varying Markets Authority if you have concerns
levels, depending on the type of adviser about the behaviour of a financial adviser.
and the nature of the services they
provide. Some financial advisers are
only allowed to provide advice on a
This investment is
limited range of products. not guaranteed
When seeking or receiving financial Gareth Morgan KiwiSaver Limited
advice, you should check: (GMKL), the manager of the Gareth
Morgan KiwiSaver Scheme (GMK and
the type of adviser you are dealing with: also referred to as we, us or our), is a
the services the adviser can provide related company of Kiwibank Limited
you with: (Kiwibank). Investments made in GMK
do not represent bank deposits or other
the products the adviser can advise liabilities of Kiwibank, New Zealand Post
you on. Limited (NZ Post) or any other member
of the NZ Post Group. (From time to time
GMK may invest in securities issued by
these related entities). Investments made
in GMK are subject to investment and
Gareth Morgan KiwiSaver Scheme3
other risks, including possible delays
in payment of withdrawal amounts in
some circumstances, and loss of
investment value. No person, including
Kiwibank, NZ Post or any other member
of the NZ Post Group, GMKL, Gareth
Morgan Investments Limited Partnership
(GMILP), Public Trust as the trustee of
GMK, or any of their respective directors,
or the New Zealand Government
guarantees the repayment of members’
interests in GMK or the payment of any
earnings or returns on investment in GMK.
All capitalised terms used in this
Investment Statement are defined in the
glossary at the back of this document,
unless the context otherwise requires.
This document is an Investment
Statement for the purposes of the
Securities Act 1978. A registered
Prospectus containing the offer of
securities to which this Investment
Statement relates is available free
of charge on request and from our
website: www.gmk.co.nz
The purpose of this Investment
Statement is to provide key information
to help you decide whether or not to
become a member of GMK. This
Investment Statement is not meant to
disclose every detail about KiwiSaver or
GMK. More detailed information is publicly
available, free of charge, in the GMK
Prospectus and Trust Deed, on our
website and from Inland Revenue.
Throughout this Investment Statement,
we will tell you where to get more
detailed information if you want it.
Investment Statement
Questions about this information? Call 0800 427 384 or email questions@gmk.co.nz4
About KiwiSaver and Gmk
Key Information
This section gives an overview of KiwiSaver and GMK. It is important that you read the
whole Investment Statement before deciding to invest.
Summary information Get the
details on
page
What is KiwiSaver? KiwiSaver is a voluntary savings initiative designed to encourage Page 10
New Zealanders to save for retirement.
Who can join? Most Kiwis can join and benefit from KiwiSaver. You don’t need Page 8
to be working to join, but you do need to be:
under 65 years old;
a New Zealand citizen or entitled to live in New Zealand
permanently; and
living, or normally living, in New Zealand. If you’re working
overseas for a Kiwi company or the NZ Government, you might
still be able to join.
What are the There are a range of benefits which may apply to you: Page 20
benefits of joining?
Benefits Employees Self Not Under
employed working 18s
$1,000 Government
yes yes yes yes
kick-start
3% compulsory
yes no no no
employer contribution
Up to $521.43 per year
yes yes yes no
Member Tax Credit
Up to $5,000 Housing
New Zealand first yes yes yes no
home subsidy
You might be able to
transfer money from
a UK Pension scheme,
an Australian complying
superannuation
yes yes yes n/a
scheme or another
NZ Complying
Superannuation
Fund to your KiwiSaver
account.
The benefits shown in this table are current at the date of this
Investment Statement, but they could change in the future.
See www.kiwisaver.govt.nz for current information. Conditions
apply to some benefits and not all members will qualify.
Gareth Morgan KiwiSaver Scheme5
What are the risks? It’s important that you invest with realistic expectations Page 33
– knowing the potential upside, and the potential downside.
All investments have risks. There is a risk that at any time the
balance of your member account could be less than the amount
you, the Government and your employer (if any) have contributed.
It is also possible you may not receive the returns you expect.
There are risks associated with GMK that could affect your ability
to recover the amount of your contributions or impact on the returns
payable from GMK as described in this Investment Statement.
The principal risks applying to GMK that could affect returns are:
1. The risks associated with the assets in the Investment Portfolios;
2. The risks associated with active investment management;
3. The risk that the Investment Portfolio you choose may be too
risky or too cautious; and
4. The risk that the rules about KiwiSaver itself might change.
How much do I If you are an employee you can contribute through your job: Page 20
need to contribute?
you can choose to contribute 3%, 4% or 8% of your gross wage
or salary each pay period;
you can also make additional, voluntary contributions; and
after you have been in KiwiSaver for 12 months you can apply to
Inland Revenue to take a contributions holiday. A contributions
holiday allows you to stop making employee contributions for
between 3 months and 5 years.
If you are not an employee, you can make voluntary contributions.
Voluntary contributions are treated differently by different KiwiSaver
providers. As a GMK member:
you can choose how much and how often you contribute, but the
minimum voluntary contribution is $20 (New Zealand dollars). If
you are entitled to it, and if $20 is paid weekly for the whole year,
you would qualify for the full Member Tax Credit; or
you don’t have to make any contributions at all.
When can I get Generally, you will not be able to withdraw your KiwiSaver savings Page 43
my money out? until you reach the age of eligibility for New Zealand Superannuation.
At the date of this Investment Statement the age is 65, but it could be
changed by law.
You can get your money out of KiwiSaver when you are 65, as long as
you’ve been a member of a KiwiSaver scheme or a Complying
Superannuation Fund for at least five years. So if you join KiwiSaver
when you are 63, you can withdraw five years later, at age 68.
You might be able to withdraw some or all of your savings earlier if:
you are buying your first home (see section ‘Eligibility for First
Home Withdrawal’ on page 47 for more details); or
you meet early withdrawal criteria for serious illness, significant
financial hardship, or permanent emigration (see section ‘How do
I cash in my investment’ on page 43 for more details).
continued over page
Investment Statement
Questions about this information? Call 0800 427 384 or email questions@gmk.co.nz6
Summary information Get the
details on
page
Who provides GMK’s full name is the Gareth Morgan KiwiSaver Scheme. Page 17
the scheme? GMK was established on 2 April 2007 and registered as a KiwiSaver
scheme under the KiwiSaver Act on 24 April 2007.
Gareth Morgan KiwiSaver Limited (GMKL) is the manager and
promoter of GMK.
GMKL has delegated the investment management of GMK’s assets
to Gareth Morgan Investments Limited Partnership (GMILP).
We may also rely on GMILP to provide other services on our behalf.
GMKL is owned by GMILP. GMILP is owned by Kiwi Wealth
Management Limited. Kiwi Wealth Management Limited is a wholly
owned subsidiary of Kiwi Group Holdings Limited (the ultimate
holding company of which is NZ Post). Kiwi Group Holdings Limited
also owns Kiwibank.
GMILP and GMKL are therefore related parties to Kiwibank,
NZ Post and their associated entities.
GMKL is 100% Kiwi owned and operated.
Where will the At the date of this Investment Statement we offer five different Page 12
money be invested? Investment Portfolios, listed from lowest risk to highest risk.
Cash: 100% cash.
CashPlus: Up to 60% in fixed interest assets, the balance in cash.
No shares.
Conservative: Up to 20% in shares, the balance in cash and fixed
interest assets.
Balanced: Up to 70% in shares, the balance in cash and fixed
interest assets.
Growth: Up to 100% in shares, but will usually have some invested
in cash and fixed interest assets.
You can pick one or a combination of these Investment Portfolios,
to suit your own timeframe, goals and attitude to risk. This is called
your Investment Direction.
If you don’t give us a valid Investment Direction, all of the
contributions in your member account or any unallocated percentage
(if your instruction adds up to less than 100%) will be invested in the
default Investment Portfolio, which as at the date of this Investment
Statement is the Balanced Investment Portfolio.
You can change your Investment Direction by contacting us or by
logging on through www.gmk.co.nz.
Gareth Morgan KiwiSaver Scheme7
What are the fees? The annual member fee is up to 1% of your member account Page 26
balance, subject to a minimum of $50 per year.
The annual member fee covers the regular ongoing costs, charges
and expenses of running GMK, such as trustee, custodian,
administration, and investment management services, registry costs,
marketing, auditing, legal fees, printing and postage, and transaction
fees paid to NZ Post for processing applications.
The annual member fee does not cover the following additional costs
and expenses: the costs of investing, such as brokerage costs
and fees charged by funds or unit trusts we invest in, costs
reasonably incurred by GMK or the trustee or custodian that are
unrelated to the regular and ongoing costs listed above.
The annual member fee is deducted from your member
account monthly.
What information You will get secure, online access to your GMK account information, Page 50
will I get about whenever you want. With our online reports you can:
my investment?
see all the contributions going into your account. Every cent,
every day. Where the contributions came from and when.
see where your money is invested. Whether it’s shares, managed
funds, fixed interest or cash, the reports show exact quantities,
valued every month.
see the fee we charge you.
see how your savings are performing every month.
You can also choose to receive your balance by text every month.
If you are a Kiwibank customer you can access your GMK reports
through Kiwibank’s internet banking service.
You will also get an annual statement and our annual report.
Does anyone No. Page 2
guarantee the
investment?
What if I belong to You can still join GMK. You can only be a member of one KiwiSaver Page 8
another KiwiSaver scheme at a time, so once you join GMK, we will contact your current
scheme? KiwiSaver scheme provider to transfer your account balance to us.
Who can I We believe the best customer service is based on direct Page 50
contact for more communication.
information?
We personally answer your phone calls and emails.
We communicate with you every month by email, with news
and information about your GMK member account and the
investment markets.
You can opt in to receiving monthly account balance updates
by text.
Call us on 0800 427 384 or email us at questions@gmk.co.nz with
any questions.
Investment Statement
Questions about this information? Call 0800 427 384 or email questions@gmk.co.nz8
Joining KiwiSaver
Employees can join KiwiSaver through Leave the rest to us
their employer, or by signing up with
a KiwiSaver provider. If we require any more information to
process your application, for instance to
People who are self-employed or not verify your identity, then we will contact
employed can join by signing up with you directly. We may refuse to accept any
a KiwiSaver provider. application without giving a reason.
The parents or legal guardians of an We will notify Inland Revenue that
under-18-year-old can sign them up with you have joined or transferred your
a KiwiSaver provider. Children must be membership to GMK.
joined under their own IRD number, not a
parent’s IRD number. Only the children’s We will send you confirmation
parents or legal guardian(s) can sign them of your membership.
up, and if they are between 16 and 18, they If you are transferring from another
must co-sign the application form with provider, we will contact them and
one of their legal guardians. arrange the transfer of your money.
We will send you confirmation when
How to join or transfer to GMK the transfer is finalised which should
be within 35 days.
It is easy to join GMK or to transfer to
us from another KiwiSaver scheme. There is no charge from us for joining
or transferring from another provider
Step 1 Read this Investment Statement
to GMK.
and decide if you want to join GMK.
You may have been automatically
Step 2 Complete the GMK
enrolled
application form:
If you start a new job and you’re not
online at www.gmk.co.nz; or
already a KiwiSaver member, you will be
use the form and instructions at the automatically enrolled. If you have been
back of this Investment Statement; or automatically enrolled in GMK, this is
phone the Kiwibank contact centre because your new employer has chosen
on 0800 11 33 55; or us as their preferred KiwiSaver provider.
through Kiwibank internet banking If you’ve been automatically enrolled, you
(if you are a Kiwibank customer) at can either stay in KiwiSaver, or you can
www.ib.kiwibank.co.nz. opt out by completing an opt-out request
form. You have 55 days after the date you
start your new job to opt out.
If you are automatically enrolled, you can
still choose your own KiwiSaver provider.
But if you don’t make a choice, you will
Gareth Morgan KiwiSaver Scheme9
become a member of a scheme your If we consider that you have not provided
employer has picked, or a Government all required information, or we have not
default scheme. been able to verify it to our satisfaction,
subject to the KiwiSaver Act you may not
Joining GMK through Kiwibank
be able to make a withdrawal from your
Kiwibank is a distributor of GMK, under member account until such information
a distribution arrangement with us. has been provided by you.
You can apply to join GMK through Use of your personal information
Kiwibank by completing the application
We will use all personal information
form at the back of this Investment
you provide during the course of your
Statement and dropping it into your
membership in GMK to administer GMK
local Kiwibank, or by calling the Kiwibank
and your membership of GMK. We may
contact centre on 0800 11 33 55 or
also use your information to provide you
by visiting the Kiwibank website at
with information about accounts, products
www.kiwibank.co.nz.
and services that might be of interest
If you join GMK through Kiwibank you will to you.
already have access to Kiwibank services,
We may disclose your personal
such as internet banking, and will be
information to:
bound by Kiwibank’s General Terms
and Conditions which are available on the Trustee;
Kiwibank’s website at www.kiwibank.co.nz our related entities (including,
or at your local Kiwibank. but not limited to, members of the
Verification of your identity NZ Post Group, including GMILP and
members of the Kiwibank group);
Under the Anti-Money Laundering and
third parties that provide services
Financing of Terrorism Act 2009 (AML/CFT
to us, the Trustee, or our related
Act) we are required to verify the identity
entities (including those providing
and address of all members. Depending
services to assist with the compliance
on the way you become a member, this
of relevant legislation);
may happen before or after, you become
a member. We may contact you to request organisations conducting market
more information after you have joined, or research, data processing and statistical
we may require it before you are able to analysis for us;
make a withdrawal. Regardless of whether anyone that we need to contact in order
you provide all required information when to carry out your instructions; or
becoming a member, we may also request any other person in order to comply
updated information under the AML/CFT with relevant legislation.
Act after you become a member.
You have the right to access and
correct your personal information by
contacting us.
Investment Statement
Questions about this information? Call 0800 427 384 or email questions@gmk.co.nz10
What sort of investment is this?
The offer is for membership in GMK. You don’t need to report or pay that tax
GMK is a registered KiwiSaver retirement yourself as GMK is a final tax PIE. But you
savings scheme. We manage and invest do need to tell us your correct tax rate.
members’ savings, which are available If you incorrectly give us a lower tax rate
to members when they are eligible to you may become liable to pay more tax to
withdraw them. Inland Revenue. If you incorrectly give us
too high a tax rate you will pay too much
Your KiwiSaver savings are locked in:
tax and will not be able to claim
KiwiSaver is designed to help you save for
it back.
retirement. Apart from a few exceptions,
your money is currently locked in until you All investments have some level of risk:
are at least 65. Withdrawing from At the date of this Investment Statement,
KiwiSaver is tied to the age you can get we offer five Investment Portfolios for
New Zealand Superannuation. At the date members to choose from: Cash (lower
of this Investment Statement it is 65, but it risk), CashPlus, Conservative, Balanced
could be changed by law. You cannot and Growth (higher risk). Depending on
join KiwiSaver after you turn 65. which you choose, your money can be
invested in the following asset classes
KiwiSaver savings are not guaranteed:
listed from lower to higher risk: cash,
The Government does not guarantee any
fixed interest or shares.
KiwiSaver scheme or their investment
products. None of GMK, the Manager,
the Trustee, or anyone else guarantees More information on these asset
your savings. classes can be found on page 34.
This is a defined contribution scheme:
This means that the amount you get Here’s how membership
when you are eligible to withdraw is of GMK works
not known in advance. It will depend on
When you join GMK, we open a
the contributions paid to your member
member account for you. Your
account, the money deducted from your
KiwiSaver contributions go into your
member account (for example fees and
member account.
taxes), the Investment Portfolios you
choose, and any investment gains We invest the contributions according to
or losses. the Investment Portfolios you choose
(Cash, CashPlus, Conservative, Balanced,
GMK is a Portfolio Investment Entity:
Growth). The timing of investing is
GMK is a Portfolio Investment Entity (PIE).
dependent on our Investment Cycle.
PIE status relates to tax. The taxable
income earned by GMK is shared between
See section ‘We operate on a monthly
members based on their interests in GMK.
investment cycle’ on page 14 for more
We calculate the tax you owe on this
information.
investment and pay it to Inland Revenue
on your behalf based on your tax rate.
Gareth Morgan KiwiSaver Scheme11
You can choose a combination of Here’s what investments
Investment Portfolios in your Investment
can be included in the different
Direction. You need to state on your
application form what percentage of asset classes
your contributions you want to invest in Asset group Assets that can be included in
each Investment Portfolio in multiples of the asset group
5%, and your total Investment Direction
Cash on call bank deposits;
must add up to 100%.
bank certificates of deposit
If you don’t give us a valid Investment with 6 months or less
to maturity;
Direction, your contributions (or any
percentage of them that has not been domestic fixed rate bonds
with 6 months or less
allocated to an Investment Portfolio) to maturity;
will be invested in the default Investment global bonds with 6 months
Portfolio which, at the date of this or less to maturity;
Investment Statement, is the Balanced bank bills; and
Investment Portfolio. floating rate notes.
The assets in the Investment Portfolios, Fixed Interest bank certificates of deposit
as well as contributions not yet invested, with 6 months or more
to maturity;
are collectively called GMK’s assets.
domestic or global fixed
As a member of GMK, you have an interest rate bonds with 6 months
or more to maturity;
in GMK’s assets. The size and value of
interests in listed or
your interest depends on things like: the unlisted trusts or funds
amount of money paid in to your member where the underlying
account, the charges such as fees and assets are fixed interest
taxes that are deducted or have been investments; and
accrued but not yet deducted, the derivatives such as interest
rate swaps and forward
Investment Portfolios you choose, and foreign exchange contracts.
any investment gains or losses.
Shares equity securities;
We provide monthly reports which show interests in listed or
all the money going in to your member unlisted unit trusts or
account, the deductions going out, and the investment funds;
size and value of your interest in GMK’s exchange traded funds,
where the underlying assets
assets from month to month. are predominantly equity
securities or commodities;
We do not assign units like many other and
KiwiSaver providers do. Instead your derivatives such as forward
reports show you the shares, fixed interest foreign exchange contracts
and cash assets that make up your and currency options.
interest in GMK.
Investment Statement
Questions about this information? Call 0800 427 384 or email questions@gmk.co.nz12
Derivatives are financial instruments that Restrictions: The Cash Investment
may be used to manage risk, or as a type Portfolio must only invest in cash; it is not
of investment instead of investing in permitted to invest in shares, unit trusts
physical assets. A derivative is a contract or funds.
with a return that is dependent on or
CashPlus
derived from one or more underlying
assets, events or conditions. The CashPlus Investment Portfolio has up
to 60% in fixed interest assets, and the
For more information about derivatives balance in cash.
and how they can be used please see
Investor attitude to risk: CashPlus is
the Prospectus.
generally suitable for people with a
short investment timeframe – less than
Here’s an overview of the GMK three years – or people who have low
Investment Portfolios tolerance for declines in the value of their
member account.
At the date of this Investment Statement,
we offer five different Investment Objective: To exceed the returns you
Portfolios with the following would receive from investing 75% of your
characteristics. You can pick one or a funds in New Zealand cash and 25% in
combination of them, to suit your own New Zealand fixed interest assets.
timeframe, goals and attitude to risk.
Restrictions: The CashPlus Investment
If you do not give us a valid Investment
Portfolio’s exposure to fixed interest must
Direction, your contributions (or any
not exceed 60%; it is not permitted to
percentage of them that has not been
invest in shares.
allocated to an Investment Portfolio)
will be invested in the default Investment Conservative
Portfolio which, as at the date of
The Conservative Investment Portfolio has
this Investment Statement, is the
up to 20% in shares with the balance
Balanced Investment Portfolio.
invested in cash and fixed interest assets.
Cash
Investor attitude to risk: Conservative is
The Cash Investment Portfolio is generally suitable for people with a
100% cash. short-term investment timeframe – one to
five years – or those who are risk averse
Investor attitude to risk: It is generally
but can tolerate the occasional decline in
suitable for people with an investment
the value of their member account.
timeframe of up to 12 months, or who
have no tolerance for risk or declines Objective: To exceed the returns you would
in the value of their member account. receive from investing 85% of your funds
in New Zealand fixed interest assets and
Objective: To exceed the returns you would
15% in shares.
receive from investing 100% of your funds
in New Zealand cash.
Gareth Morgan KiwiSaver Scheme13
Restrictions: The Conservative Investment Objective: To exceed the returns you
Portfolio’s exposure to shares must not would receive from investing 85% of
exceed 20%. your funds in shares and 15% of your
funds in New Zealand fixed interest
Balanced
assets and cash.
The Balanced Investment Portfolio has up
Restrictions: None.
to 70% in shares, with the balance in cash
and fixed interest assets.
The investment strategy team
Investor attitude to risk: Balanced is
generally suitable for investors with a
and how they work
medium-term investment timeframe GMKL has delegated the investment
– five to ten years – or those who have management functions (i.e. managing
a moderate appetite for risk and GMK’s assets) to the investment strategy
tolerance for declines in the value of team at GMILP. They are a mixed
their member account. discipline team, with senior level
experience in both economics and
Objective: To exceed the returns you would
asset management, including research,
receive from investing 45% of your funds
analysis, selection and monitoring of
in New Zealand fixed interest assets and
equities and fixed interest portfolios
55% in shares.
both in New Zealand and overseas.
Restrictions: The Balanced Investment For more information about the members
Portfolio’s exposure to shares must not of the investment strategy team please
exceed 70%. see the Prospectus or our website:
www.gmk.co.nz.
At the date of this Investment Statement,
the Balanced Investment Portfolio is the They are governed by the guidelines set
default Investment Portfolio. out in the Statement of Investment Policy
and Objectives (SIPO) and detailed in the
Growth Prospectus, and their activities and
The Growth Investment Portfolio has performance are overseen by the
up to 100% in shares, but will usually have Investment Governance Committee,
some invested in fixed interest and cash which is appointed by the GMILP Board.
assets. Detailed information about GMK’s
investment policy and objectives is
Investor attitude to risk: The Growth included in the Prospectus.
Investment Portfolio is generally suitable
for investors with a long investment
timeframe – more than ten years – and
who have a greater tolerance for declines
in the value of their member account.
Investment Statement
Questions about this information? Call 0800 427 384 or email questions@gmk.co.nz14
Managing risk appropriately is the We operate on a monthly
Investment Manager’s priority investment cycle
This means they take into account your Contributions received during the month
Investment Direction and focus on: are put into GMK’s trust account and
linked to your member account where they
Diversification – investing your savings
earn interest. At the end of each month
across a large number of assets,
money held in your member account is
sectors, countries and industries,
transferred to the Investment Portfolios
so if one fails, you lose a button,
you chose so we can buy investment
not your shirt;
assets with them. Some cash is kept in
Liquidity – being able to sell your member account to pay your fees and
investments in a timely manner taxes. Your contributions are normally
without adversely affecting their invested within two weeks – by mid-month
prices; and – but we may decide to vary this timing
and increase the proportion of your
Investing for the long term – no big contributions that are retained in GMK’s
punts or concentrated bets, and no trust account. For this reason, it is
chasing investment fads. possible that contributions we receive on
Active management style the first day of one month might not be
fully invested for up to four to six weeks.
The investment strategy team has an
active management style. This means
they adjust the asset allocation of the
Investment Portfolios, within the allowable
limits, according to their view of what’s
happening in markets. They also evaluate
investments to add quality assets at the
right price to each of the Investment
Portfolios through active stock selection.
Global investment focus
We favour global markets over local
markets because most New Zealanders
already have most of their wealth invested
in New Zealand – through their homes and
jobs. We believe investments in global
markets can help spread your investment
risk and provide good liquidity.
Gareth Morgan KiwiSaver Scheme15
Choosing your Investment Direction
Your Investment Direction is your choice If you are planning to withdraw
of the GMK Investment Portfolio(s) that
best suits your financial goals, timeframe,
your KiwiSaver money to buy
and your attitude to risk. You can choose your first home
from Cash, CashPlus, Conservative, Select an Investment Direction with the
Balanced or Growth – either one, or a timing of your home purchase in mind.
combination of them.
When do you expect to buy your house?
It’s important to remember that all
investments have some degree of risk. Investment Portfolio
As soon as I can: Cash
You can find information about the
In about a year: CashPlus
risks associated with investing in GMK
in the section ‘What are my risks’ on In about 3 years: Conservative
page 33. Longer than Use the following
three years? questions
Don’t forget this questionnaire is just a
guide; it doesn’t take into account your If you’re using KiwiSaver to save
personal circumstances. The information
contained in this questionnaire is based
for retirement
on pre-defined characteristics (e.g. years Ask yourself the following questions,
to retirement at age 65 and attitude to then add up the points to see what
risk). Read the descriptions of all the Investment Portfolio matches your total.
Investment Portfolios on pages 12 to 13 There are no right or wrong answers;
and see which sounds most like you, or it’s what best suits you.
whether a combination of the Investment
Portfolios might suit you better. You How long until you plan to withdraw
may also want to consider any other your money?
investments you have outside KiwiSaver
Less than 12 months 0 points
and how these might affect the Investment
Direction you choose. If you need more 1-2 years 2 points
help to determine your Investment
3-10 years 5 points
Direction you should contact an authorised
financial adviser. 10 years plus 7 points
If your answer is less than 3 years you
may wish to refer to the previous table
regarding first home withdrawal rather
than continue on with the questionnaire.
Investment Statement
Questions about this information? Call 0800 427 384 or email questions@gmk.co.nz16
Which statement best describes how you Range of investment returns for a single year
feel about your KiwiSaver account as an
investment for retirement? 30%
25%
I’m less concerned with how much 0 points 20%
my savings grow; just don’t lose the
money I’ve put in. 15%
I accept that my account may drop in 1 point 10%
value on the odd occasion but would 5%
expect it to grow slowly and steadily.
0%
I am more concerned with growing 2 points
my savings and I can accept monthly -5%
gains and losses in my account value -10%
but I would feel very uneasy if I didn’t
recover any significant losses within -15%
a couple of years. Option 1
Option 2
Option 3
Option 4
I want to maximise my savings. 3 points
I accept that my account may have
significant losses, that may take
many years to recover. Option 1 - Return ranging 0 points
from 2% to 5%
Which range of returns would you feel
most comfortable with? Option 2 - Return ranging 1 point
from -5% to 14%
Different Investment Portfolios will have
Option 3 - Return ranging 2 points
different levels of risk, and as a result, from -10% to 21%
varying expected returns. Low levels
of uncertainty (low-risk) are associated Option 4 - Return ranging 3 points
from -15% to 28%
with lower and more consistent expected
returns, while high levels of uncertainty
(high-risk) are associated with higher and Add up your points to see which Investment
more variable expected returns. Portfolio matches your total:
0 1 2 3 4 5 6 7 8 9 10 11 12 13
If you are looking for a higher expected
return, you need to be prepared for a wide Cash CashPlus Conservative Balanced Growth
range of returns in any single year.
Don’t forget this questionnaire is just
Considering this, here are some examples
a guide!
of how much returns on a hypothetical
investment could vary (rise or fall) over a
single year. Which range of returns would
you feel most comfortable with?
Gareth Morgan KiwiSaver Scheme17
Who is involved in providing it for me?
GMK’s full name is the Gareth Morgan GMKL is owned by GMILP. GMILP is owned
KiwiSaver Scheme. GMK was registered by Kiwi Wealth Management Limited. Kiwi
as a KiwiSaver scheme under the Wealth Management Limited is a wholly
KiwiSaver Act on 24 April 2007. owned subsidiary of Kiwi Group Holdings
Limited (the ultimate holding company of
Gareth Morgan KiwiSaver which is NZ Post). Kiwi Group Holdings
Limited also owns Kiwibank.
Limited (GMKL) is the manager
and promoter of GMK GMILP and GMKL are therefore related
parties to Kiwibank, NZ Post and their
GMKL is responsible for offering associated entities.
membership in GMK, accepting
applications and allocating interests in GMILP may invest GMK’s assets with a
GMK to members, managing GMK’s assets related party, provided that the transaction
and administering GMK. is conducted on commercial arm’s length
terms and subject to the usual principles
GMKL has delegated the investment of prudence, liquidity and diversification.
management functions (i.e. managing Details of GMK’s related party holdings
GMK’s assets) to GMILP. We may also are set out in the Prospectus.
rely on GMILP to provide other services
on our behalf.
Ownership structure
New Zealand Post Limited
Kiwi Group Holdings Limited
Kiwi Wealth Kiwibank Limited
Management Limited
Gareth Morgan Investments
Limited Partnership
Gareth Morgan
KiwiSaver Limited
Investment Statement
Questions about this information? Call 0800 427 384 or email questions@gmk.co.nz18
At the date of this Investment Statement, Public Trust is the trustee
the Directors of GMKL are:
of GMK
Paul Robert Brock, Wellington;
The Trustee is responsible for the custody
Brian Joseph Roche, Wellington. of GMK’s assets, and supervising the
performance of our functions under the
You can get a brief summary of the Trust Deed and all relevant law.
Directors’ relevant qualifications and
professional history in the Prospectus. At the date of this Investment Statement,
Public Trust has nominated JBWere (NZ)
At the date of this Investment Nominees Limited as the custodian to
Statement, up to two more directors hold GMK’s assets. Public Trust retains
for GMKL are being selected for primary responsibility for the custody of
possible appointment. GMK’s assets.
On 17 September 2012, the Trustee was
Director details may change at any time. granted a licence pursuant to the
For up-to-date information call GMK Securities Trustees and Statutory
Member Services, 0800 427 384 or email Supervisors Act 2011. Full details and
questions@gmk.co.nz. conditions which apply in respect of the
At the date of this Investment Statement, licence can be found on the Trustee’s
the address for GMKL website, www.publictrust.co.nz/corporate-
and where you can contact the trustee-services/who-are-we
GMKL Directors is: At the date of this Investment Statement,
Postal address: the address of the Trustee is:
Gareth Morgan KiwiSaver Limited Postal address:
Freepost 210729 Public Trust
PO Box 10068 PO Box 5067
Wellington 6143 Wellington 6145
Street address: Street address:
Gareth Morgan KiwiSaver Limited Public Trust
Level 10, 109 Featherston Street Level 10, 141 Willis Street
Wellington 6011 Wellington 6011
Address details may change at any time. Address details may change at any time.
For up-to-date contact information call For up-to-date contact information call
GMK Member Services, 0800 427 384 or GMK Member Services, 0800 427 384 or
email questions@gmk.co.nz. email questions@gmk.co.nz.
Gareth Morgan KiwiSaver Scheme19
Responsible Investment Policy
Responsible investment, including
environmental, social and governance
considerations, is taken into account
in the investment policies and procedures
of the scheme, as at the date of this
Investment Statement. You can obtain
an explanation of the extent to which
responsible investment is taken into
account in those policies and procedures
on our website: www.gmk.co.nz which is
publicly accessible at all reasonable
times; and from us, free of charge,
upon request.
Investment Statement
Questions about this information? Call 0800 427 384 or email questions@gmk.co.nz20
How much do I pay?
The payments you make to GMK are Taking a contributions holiday
called contributions. How much you
You don’t have to make employee
pay depends on whether you make
contributions if you are taking a
contributions through your job or make
contributions holiday granted by
your own contributions. Contributions
Inland Revenue.
may also be made by the Government,
and by your employer if you have one.
See the section ‘Can the investment
be altered?’ on page 40 for more
Making contributions through information on contributions holidays.
a job
If you are an employee you contribute Making voluntary contributions
either 3%, 4% or 8% of your pre-tax
If you are self-employed, not working,
(gross) salary or wages. These are called
or under 18 you can make your own
employee contributions. You are an
contributions. These are called voluntary
employee if PAYE is deducted from your
contributions, and you can make them
salary or wages.
through GMK, Inland Revenue, or
You tell your employer what contribution Kiwibank if you are a Kiwibank customer.
rate you want. If you don’t tell your You can make regular contributions
employer, you’ll pay the lowest rate – or lump sum contributions whenever
which at the date of this Investment you want to.
Statement is 3%.
Employees can also make voluntary
Your employer takes your contributions contributions at any time if they want to.
from your after-tax salary or wages each
Voluntary contributions made directly to
pay period, and pays them to Inland
GMK or through Kiwibank must be at least
Revenue, who then pass them on to us.
$20 (New Zealand dollars only). If you are
Your gross salary or wages includes entitled to it, and if $20 is paid weekly for
overtime and bonuses but doesn’t include the full year, this would qualify you for
ACC and weekly compensation payments, the full Member Tax Credit. There is no
paid parental leave payments and maximum; you can contribute as much
redundancy payments. as you want.
Contribution rates are set by legislation
See the section ‘What the Government
so the Government could change them
pays’ on page 23 for more information
at any time.
about the Member Tax Credit.
You can change your contribution rate by
telling your employer what rate you want
GMK does not require members to make
to change to. You can’t make more than
any voluntary contributions.
one change every three months, unless
your employer agrees.
Gareth Morgan KiwiSaver Scheme21
Making voluntary contributions through Making voluntary contributions
Inland Revenue through Kiwibank
Contributions through Inland Revenue If you join GMK through Kiwibank or
can be made in the following ways: are a Kiwibank customer you will be able
to make voluntary contributions to GMK
using the “Pay Tax” option on your
in the following ways:
bank’s internet banking facility;
by deposit at your local Kiwibank; or
sending a cheque to Inland Revenue
made out to the Inland Revenue through Kiwibank internet banking.
Department; or
Contributions by deposit must be at least
paying over the counter at a Westpac $20 (New Zealand dollars only) and must
Bank branch. be accompanied by your Kiwibank Access
Number (a unique Kiwibank customer
Your contribution must be accompanied
number) otherwise Kiwibank may not be
by your name, address, tax file number
able to accept your contribution and pass
(IRD number), using the tax type reference
it to GMK.
KSS and any other information that Inland
Revenue requires. These services are automatically
available to members who sign up
Making voluntary contributions directly
to GMK via Kiwibank.
to GMK
If you are a member who did not join
Contributions can be made directly to GMK
through Kiwibank and are a Kiwibank
in the following ways, by:
customer, you can choose to use
direct debit payment to GMK’s bank Kiwibank’s internet banking services.
account; or To arrange this you can contact Kiwibank
or GMK’s Member Services team. If you
lump sum contribution by cheque. choose to use Kiwibank’s internet banking
Your contributions must be at least services, you will be bound by Kiwibank’s
$20 (New Zealand dollars only) and General Terms and Conditions which are
accompanied by your IRD number. If you available on Kiwibank’s website
do not include your IRD number, we may www.kiwibank.co.nz.
not be able to process your payment and If you make contributions through
credit your member account. Kiwibank, Kiwibank will reconcile them
We may increase or reduce minimum before passing them on to us. Until those
contribution amounts (which, at the date contributions are passed on to us,
of this Investment Statement, is $20), and Kiwibank will hold them in a non-interest
will notify you of any such change at least bearing account and so you will not earn
one month before the new minimum interest on them. In normal circumstances,
contribution amount becomes effective. Kiwibank will transfer your contribution to
us within two business days of receiving it.
Investment Statement
Questions about this information? Call 0800 427 384 or email questions@gmk.co.nz22
You should note that any contributions paid parental leave payments and
made through Kiwibank that are not paid redundancy payments.
to GMK by 30 June in each year may not
Your employer can contribute at a higher
count towards your eligibility for Member
rate if they wish.
Tax Credits. If you have any concerns
about contributions being made close Employer contributions are subject to
to the end of June please contact us employer superannuation contribution
about making the contribution directly tax (ESCT). This means you won’t get
to us instead. the full amount of the contribution in
your account.
In our distribution arrangement with
Kiwibank we have agreed the levels of
service that Kiwibank must provide, See the section on tax in the
including agreed processes for receiving Prospectus for more information.
and collating contributions for GMK.
If you are over 65 or under 18
What happens if I don’t
If you are over 65 and eligible to withdraw,
pay anything? or if you are under 18, your employer
If you are not an employee, or if you are doesn’t have to make contributions to
on a contributions holiday, you don’t your KiwiSaver account – but they can
have to make any contributions to GMK. if they wish.
But you will stop being a member of GMK
If you are on a contributions holiday
if your member account balance is zero
or negative. If you have chosen to go on a contributions
holiday then your employer will also
Do I have to make a payment cease to make contributions to your
KiwiSaver account.
to open an account?
If you are a member of another
No, you do not need to make a payment
superannuation scheme
to open a member account with GMK.
If your employer makes contributions
What your employer pays to another Complying Superannuation
Fund that you belong to, those
Your employer must make contributions contributions may count towards the
to your KiwiSaver scheme, except as compulsory employer contributions
detailed below. As at the date of this required for GMK. See the Prospectus
Investment Statement the compulsory for further details.
employer contribution rate is 3% of
your gross salary or wages. Your gross
salary or wages includes overtime
and bonuses but doesn’t include ACC
and weekly compensation payments,
Gareth Morgan KiwiSaver Scheme23
What the Government pays Transferring from an Australian
complying superannuation scheme
If GMK is the first KiwiSaver scheme you to GMK
join, the New Zealand Government will, as
at the date of this Investment Statement, If you have contributed to any Australian
pay a contribution of $1,000 which we will complying superannuation schemes, and
credit to your member account. This is now live permanently in New Zealand, you
called a kick-start. This contribution will can transfer your Australian
be made about three months after Inland superannuation savings to your GMK
Revenue receives your first contribution member account.
or receives notice of your membership Generally the rules for KiwiSaver schemes
of GMK. will apply to money transferred from
The Government will also pay a Member Australia, with the following differences:
Tax Credit of up to a maximum of $521.43 You cannot use money transferred from
per year (the equivalent of approximately Australia for a first home purchase.
$10 per week) if you are over 18, living in
New Zealand, and you have not yet You may be able to withdraw money
reached your KiwiSaver End Payment transferred from Australia at age 60,
Date. This is paid at 50 cents for each rather than 65.
dollar you contribute, up to a maximum of
You can’t transfer the money moved
$521.43 per year. This means you need to
from Australia to a third country.
contribute $1,042 per year (the equivalent
of $20 per week) to receive the maximum
More information about Trans Tasman
Member Tax Credit. In the first year of
Portability is set out on page 25 of this
membership, or the year you turn 18,
Investment Statement.
or the year you reach your KiwiSaver End
Payment Date the amount of Member Tax
Credit paid will be in proportion to how Transferring from a KiwiSaver scheme
much of the year you were eligible to or a New Zealand superannuation
receive a Member Tax Credit. scheme to GMK
Government contributions are set You can transfer any amount from another
by legislation and could be changed KiwiSaver scheme to GMK by filling in an
or suspended at any time. See the application to join GMK. We will contact
Prospectus for further details. Inland Revenue and your old provider to
arrange a transfer of funds. We will let
you know when the transfer has been
Other ways to contribute completed. We do not charge a fee for
You might be able to transfer money from transfers.
a UK Pension plan, an Australian
complying superannuation scheme or
another NZ superannuation scheme to
your KiwiSaver account.
Investment Statement
Questions about this information? Call 0800 427 384 or email questions@gmk.co.nz24
You may also be able to transfer If you make a UK Transfer you will only
funds from other New Zealand be able to access those funds by making
superannuation schemes to your GMK a permitted withdrawal under the
account. Please contact us on 0800 427 KiwiSaver Act.
384 or questions@gmk.co.nz with details
Transferring your UK Pension plan
about the other superannuation scheme,
funds to GMK is an important decision.
and we will advise you if a transfer is
It is recommended that you discuss
possible, and if so, how to arrange it.
proposed transfers with your UK and
A transfer from another superannuation
New Zealand tax advisers as well as your
scheme will be subject to the other
UK pension provider.
scheme’s approval.
We may impose conditions on acceptance
Transferring UK Pension plan funds
of any UK Transfers, subject to compliance
to GMK
with legislation and the Trust Deed. We do
This summary of the implications of not guarantee that GMK will retain QROPS
transferring your UK Pension plan funds status at all times. If the QROPS status of
to GMK is based on our understanding of GMK is lost, your UK tax implications may
UK Pension rules as at the date of this change in relation to transfers into GMK.
Investment Statement. Future changes
Neither we, nor the Trustee nor any other
to those rules could adversely affect the
person involved in providing GMK to you
treatment of UK Pension plan transfers
takes any responsibility for any HMRC tax
to GMK and payments from GMK.
charges that arise as a result of you
GMK is a Qualifying Recognised Overseas making a UK Transfer, or of GMK losing its
Pension Scheme (QROPS), accepted by QROPS status.
Her Majesty’s Revenue and Customs
(HMRC) as such. This means that
transfers from a UK Pension plan to
GMK (UK Transfers) will not incur HMRC
tax charges if the amount transferred
is within your remaining UK ‘lifetime
allowance’. The total UK lifetime
allowance is £1.25 million for the
2013/2014 tax year.
If your UK Pension plan contains any
guaranteed minimum benefits such
as those contained in a defined benefit
scheme or a final salary scheme,
such guarantees will not apply to any
UK Transfers.
Gareth Morgan KiwiSaver Scheme25
Moving retirement savings between New Zealand
and Australia
The New Zealand and Australian Neither we, nor the Trustee nor any
Governments have agreed that KiwiSaver other person involved in providing GMK
and Australian complying superannuation to you take any responsibility for any
scheme savings can be moved between the tax charges that may arise as a result
two countries in certain circumstances. of you transferring your Australian
This is called the Trans Tasman Portability superannuation savings to your GMK
of retirement savings. member account.
You can transfer savings You can transfer savings
from an Australian complying from your GMK member
superannuation scheme to your account to Australia
GMK member account You can only transfer your member
account if you have permanently emigrated
If you have contributed to any Australian
to Australia.
complying superannuation schemes,
and now live permanently in New Zealand, Once a transfer is approved by us, all the
you can transfer your Australian money in your member account including
superannuation savings to your GMK the Government kick-start and any Member
member account. Tax Credits will be transferred, and your
Generally the rules for KiwiSaver schemes KiwiSaver account will be closed.
will apply to money transferred from You can only transfer to an Australian
Australia, with the following differences:
complying superannuation scheme.
You cannot use money transferred from
Transferring is voluntary. You can keep
Australia for a first home purchase.
your savings in your KiwiSaver account
You may be able to withdraw money if you want to.
transferred from Australia at age 60,
rather than 65. Generally, the rules of the scheme you
transfer to will apply, but there are some
You can’t transfer the money moved from differences to be aware of:
Australia to a third country.
The age of eligibility for New Zealand
You can get more details about Trans Superannuation applies to withdrawals
Tasman Portability of retirement savings in of KiwiSaver transfers. At the date of this
the Prospectus and on the GMK website: Investment Statement it is 65.
www.gmk.co.nz.
You can’t use your KiwiSaver savings
Transferring your savings from your
to purchase a first home in Australia.
Australian complying superannuation
scheme to your GMK member account You can’t transfer your KiwiSaver savings
is an important decision. We recommend to a third country.
that you discuss proposed transfers
with your Australian and New Zealand
tax advisers as well as your Australian
complying superannuation scheme provider.
Investment Statement
Questions about this information? Call 0800 427 384 or email questions@gmk.co.nz26
What are the charges?
Member fee The annual member fee covers the regular
and ongoing costs of running GMK which
As a member of GMK, you pay an annual includes trustee services, custodian
member fee that covers the regular services, administration services,
ongoing costs and expenses of the investment management services, registry
management and administration of GMK. costs, marketing, auditing, legal fees,
At the date of this Investment Statement, printing and postage and transaction
this fee is up to 1% per year of your fees paid to NZ Post for processing
member account balance, subject to a applications.
minimum fee of $50 per year. We calculate
and deduct this fee from your member The annual member fee does not cover
account each month. the costs of investing, such as brokerage
costs for buying and selling shares, and
The amount of the annual member fee you any fees charged by funds or unit trusts
pay may vary (subject to the minimum of we invest in, and costs reasonably
$50 per annum) depending on the incurred by GMK or the trustee or
Investment Portfolio you choose in your custodian that are not related to the
Investment Direction and your member regular and ongoing costs listed above.
account balance. We show the exact
amount of the annual member fee you pay
See the section ‘Additional costs,
on your monthly reports and on your
charges and expenses’ on the next
annual statement.
page for more information.
The annual member fee for each
Investment Portfolio as at the date of this GST
Investment Statement is:
All fees are stated on a GST exclusive
Investment Portfolio Fee charged per year basis.
(% of member account
balance) Some fees are wholly or partially exempt
from GST. For instance there is no GST
Cash 0.45%
payable on the annual member fee. If GST
CashPlus 0.7% is payable on any fee then the GST is
Conservative 1.0%
payable in addition to the fee stated.
However, we have agreed with the Trustee
Balanced 1.0% that, until further notice, we will pay any
Growth 1.0% required GST on your behalf from the
annual member fee, and not charge it as
an additional cost to you.
Gareth Morgan KiwiSaver SchemeYou can also read
