Another OCR drop? Three smart ways to restructure your mortgage now.
Lisa and Tom had $180k of usable equity locked up in their Tauranga home and a bank that kept saying 'maybe next year'. Here's the structure MHQ used to get them across the line — interest-only, equity recycle, lender switch — and the four-year plan that followed.
Zhiyang Cheng,
Mortgage Adviser & Sales Manager
Advice for every stage, all our knowledge in one place.
What types of personal insurance can you help with?
The core areas are Life Insurance, Health Insurance, Income Protection and Disability or Total and Permanent Disability cover. Depending on your situation, the advice process may also consider trauma or critical illness cover and other forms of personal protection.
Does commission affect which insurer you recommend?
It shouldn't determine the recommendation. Your advice should be based on your circumstances, needs and goals. Financial advisers in New Zealand have duties that include giving priority to the client's interests and exercising care, diligence and skill. Relevant conflicts and commissions must also be disclosed.
If the insurance advice is free, how does the adviser get paid?
When you take out an insurance policy following advice, the insurer will generally pay the insurance adviser a commission. This means the cost of getting advice does not usually need to come out of your pocket separately. How the adviser is paid, including relevant commissions or incentives, will be disclosed to you as part of the advice process. New Zealand disclosure rules specifically require advisers to explain relevant fees, commissions and incentives.
Does it cost anything to get insurance advice?
In most cases, there is no direct advice fee for arranging your Life, Health or Disability insurance through our specialist advice service. If any fee could apply, this will be explained to you before you proceed.
What is the biggest KiwiSaver mistake people make?
For many people, it’s not making a terrible investment decision. It’s not making a decision at all. KiwiSaver can sit quietly in the background for decades. The provider you joined years ago, the fund you defaulted into and the contribution rate you never revisited can eventually become a very large pool of money.
When should I start reducing risk as retirement gets closer?
There isn’t one birthday when everyone should suddenly become conservative. As retirement approaches, we look at when you expect to access the money, how much you'll need in the early years, what other assets and income you have, and how much investment volatility you can absorb. From there, risk can be reduced strategically rather than switching everything at once. That is the thinking behind your Strategic Risk Reduction stage.
Should I put extra money into KiwiSaver or pay down my mortgage?
It depends, and we think this is where joined-up financial advice becomes valuable. Paying down debt gives you a relatively predictable benefit through interest saved. Investing gives you access to potential long-term growth but with investment risk and less liquidity in KiwiSaver. Your mortgage rate, timeframe, tax position, risk tolerance and financial goals all influence the decision. The important thing is not to treat your mortgage, KiwiSaver and wider wealth strategy as completely separate conversations.
How much should I contribute to KiwiSaver?
The default contribution rate for employees is currently 3.5%, with the default employee and matching employer rate scheduled to rise to 4% from 1 April 2028. But the default rate is a government setting, not a personalised retirement strategy. The right contribution for you depends on income, mortgage commitments, other investments, retirement goals and how much flexibility you want outside KiwiSaver.
Once I've bought my first home, what should happen to my KiwiSaver?
This is one of the most overlooked KiwiSaver moments. Once the deposit goal disappears, your investment timeframe can suddenly extend by decades. That may create an opportunity to revisit your fund, level of risk and contributions and move into what we call Retirement Acceleration. You’ve used KiwiSaver for the first big milestone. Now it can start building the next one.
I'm buying my first home. Should I move my KiwiSaver into a lower-risk fund?
Potentially. The closer you are to needing the money, the more important it becomes to consider the impact of a major market fall immediately before your withdrawal. This is where KiwiSaver changes from being primarily a growth strategy into a deposit strategy. We help you decide when and how much risk should come off rather than making an arbitrary switch based on headlines.
Growth, Balanced or Conservative. Which fund should I be in?
It depends on when you expect to need the money and how comfortable you are with your balance moving up and down. Someone with 30 years until retirement may have a very different capacity for investment risk than someone planning a first-home withdrawal next year. We match the strategy to the job the money needs to do, rather than your age alone.
Should I choose the KiwiSaver provider with the best recent returns?
Usually not based on recent performance alone. The fund at the top of a performance table today can be very different from the one at the top several years from now. We look at investment philosophy, risk, asset allocation, consistency, fees, management style and how the fund fits your timeframe. The goal is not to chase yesterday’s winner. It’s to build a strategy you can stick with.
Is active management worth paying more for?
Sometimes, but the fee alone doesn’t tell you whether it is worthwhile. What matters is whether the manager delivers enough value after costs, over an appropriate period and for the risk taken. A higher fee doesn’t guarantee better performance, and a lower fee doesn’t guarantee a better outcome. That’s why we prefer to compare the whole investment proposition, not one number.
What’s the difference between an active and passive KiwiSaver manager?
A passive manager generally aims to track a market index rather than trying to consistently beat it. An active manager makes investment decisions about what to buy, sell or avoid in an attempt to outperform a benchmark or manage risk differently.
Should I choose the KiwiSaver fund with the lowest fees?
Not necessarily. Low fees are attractive, but the cheapest fund can still be the wrong fund if the investment strategy, level of risk or provider doesn’t suit you. Likewise, a more expensive fund needs to demonstrate that the additional cost is delivering value.
Aren’t KiwiSaver returns already shown after fees, so do fees really matter?
Yes, fees still matter, but they shouldn’t be looked at in isolation. Standard KiwiSaver fund reporting includes return measures net of annual fund charges, which means the published result already reflects those charges. That makes the outcome after fees more useful than simply comparing fee percentages.
My KiwiSaver is already growing. Why would I need an adviser?
Because having KiwiSaver and having a KiwiSaver strategy are different things. Your provider, fund, level of risk and contribution strategy can all influence where you end up. We help work backwards from what you want KiwiSaver to achieve and make sure the settings underneath it make sense.
If I don’t pay for KiwiSaver advice, how do you get paid?
Fund providers pay us directly. The fees you pay don’t change. You use an adviser, you do it yourself - the fee remains the same.
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