Emerging markets - a new option

SuperLife has introduced an Emerging Markets Pool. The graph shows the country make up and relative sharemarket size of the emerging markets. The actual Emerging Markets Pool’s investments will be drawn from these countries. This Pool currently uses a combination of Templeton, Vanguard and iShares, for its implementation. More information can be found on the website. 

For members who invest in the AIM30, AIM60, AIM80, AIMAgeSteps, Managed³⁰ and Managed⁶⁰ options, emerging markets will be incorporated into these strategies in the months ahead. It is ultimately expected to become 20% of the share exposure.

Investment markets

The investment markets over the March quarter were generally positive. Japan was the exception. Returns are on the back page. 

On a relative basis, SuperLife continues to do well against both market indices and other schemes. This graph plots the after-tax returns of the balanced options of the different schemes in the Eriksen Survey to 31 December 2010. SuperLife’s AIM60 and Managed⁶⁰ are the two bars on the right.

2011 investment seminars

The next seminars are in the Central North Island/Bay of Plenty region in early May (Rotorua, Whakatane, Tokoroa and Tauranga). The seminars have a focus on how to “convert your capital into income in retirement”, and how to manage your investment strategy. They also include an investment market update relevant for anyone looking to review their in-vestment strategy. Seminar details are on www.SuperLife.co.nz under seminars. The semi-nars are free and you can bring a friend or a family member. Before the June statements are out, seminars will also be held in Hawkes Bay, New Plymouth, Dunedin and Invercargill.

Your retirement & SuperLife

When you retire, you can use SuperLife to provide a regular income. Using SuperLife to provide an income and to take out other lump sums during retirement is a great way to man-age your retirement income needs. No tax is payable on any payments made. Members can see the full range of benefit payment options on www.SuperLife.co.nz/booklets/payment of benefits. See also the “Managed Income” paper on our SuperLife website.

Buying your first home

If you have not owned a home before and have been in KiwiSaver for at least 3 years, you can use your KiwiSaver savings to help buy your first home. KiwiSaver lets you withdraw all of your personal savings, those of your employer and all investment earnings. You may also qualify for the extra free money from the government of up to $5,000. Phone Super-Life for a first home pack.

A child's education

Q. Is there a no fuss way to save for a child’s education?

A. Yes, myFutureFund.

myFutureFund lets parents, relatives and friends, save for a child’s future. It complements KiwiSaver and brings the advantages of SuperLife to children.

If a child is in SuperLife's KiwiSaver scheme and is under 18, the administration fees for the child’s FutureFund Account are nil. This lets you save as much as you like and when you wish, for the child, knowing that administration fees will not be taken out. You can make regular contributions or lump sums.

For parents or relatives wanting to save for a child, it is better than a bank savings account - more flexibility, better options and more control. It is an account that lets you make a difference to a child important to you. Contact SuperLife for a myFutureFund pack or go to www.myFutureFund.co.nz.

After-tax returns 

>> View the latest after-tax returns.

"My future strategy"

If I reviewed my investment strategy (i.e. asset mix) today and was concerned mainly with performance over the next 2 - 3 years, I would be thinking about:

• keeping my cash down to the lowest level I felt comfortable with, in favour of bonds.
• holding more NZ bonds than normal. Yields of investment grade corporate bonds are higher than cash rates and are locked in for a longer period.
• favouring overseas nongovernment bonds over overseas government bonds to capture the higher returns available and to reduce the risk should government bond yields rise.
• favouring Australian shares over overseas shares to capture the expected growth in the Asian economies. I would want to have more Australian shares than normal but a normal level of NZ shares.
• maintaining the currency hedge on my overseas shares above the 50% hedged neutral position.
• not putting any new money into the property sector, until there are signs of genuine economic growth. I should not expect an increase in property until late 2011 but note, with the current market dynamics, supply and demand considerations might bring this forward.

The above strategy consolidates the themes since March 2009.

However, as with all investment decisions, what might be the right strategy over the medium term, may not be right over the very short term. We really don’t know what will happen over the short term.

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