Some of the changes include simplified and reduced fees
BNZ has announced a series of changes to its KiwiSaver offerings, in a bid to help customers make better financial decisions.
From May 01, BNZ removed the $1.95 monthly member fee and reducing management fees. The bank said it is the first of the big four banks to make this move.
“These changes remove important barriers to choosing the best fund for a customer’s needs, with the moderate, balanced, and growth funds now all on the same low fee,” BNZ chief customer officer Paul Carter said. “By this action, we’re removing fees as a consideration when deciding what fund to go into.”
Under the new structure, a person with $20,000 invested in the BNZ Growth fund would have their fees more than halved, from $243 to $116, which means more in their retirement nest-egg or helping them get into their first home faster.
Among the other changes include, re-rewritten disclosure documents and communications in plain English; launch of new tools for bankers; and more tools for customers with calculators to help them compare the different funds and returns over time.
BNZ is also changing the way the underlying investments are managed, shifting to an index management approach for international assets, while keeping the actively managed approach for Australasian investments.
The changes follow a new research from the forthcoming Bank of New Zealand (BNZ) Wellbeing Survey, which shows that not having enough savings for retirement is the biggest driver of financial anxiety for New Zealanders. The study found 55% of all New Zealanders think they won’t have enough to retire on.
Read more: Scheme challenges KiwiSaver industry to keep costs low
BNZ also mentioned recent reports that revealed the average KiwiSaver balance to be too low at around $19,500, that New Zealanders aren’t contributing enough, and that too many people are in the default conservative funds when they need to be in growth ones.
“Customers tell us they know they need to do something about their KiwiSaver, they just don’t know what, and they’re looking to their bank to help,” Carter noted. “The onus is on financial institutions to do everything we can to remove obstacles, to make things simpler, and give people better tools and advice.
“That’s why we’re making major changes to our KiwiSaver offering,” he added.
