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Amanah KiwiSaver review

A Shariah-compliant KiwiSaver plan that's great for impact investors.

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Amanah Ethical offers the only actively managed KiwiSaver scheme with a Shariah-compliant sustainable investing portfolio.

In this review, we take a look at the Amanah KiwiSaver fund, portfolio and fees to help you decide if this is the right KiwiSaver scheme for you.

About Amanah Ethical

Amanah Ethical is a boutique fund manager specialising in ethical investment solutions. It currently offers a KiwiSaver scheme as well as one other actively managed investment plan. Amanah focuses on providing portfolios for impact investors who can simultaneously benefit from market-leading returns.

Amanah KiwiSaver fund

The Amanah KiwiSaver scheme invests in the Amanah Growth Fund, which is a high-return portfolio accompanied by higher volatility.

This fund is an 80/20 portfolio, with the former portion being allocated towards higher-risk international equities. The remaining 20% of the portfolio is invested in cash and equivalents.

Further breaking down the portfolio composition, Amanah has a strict investment mandate that precludes funding any potentially unethical activities, ranging from pork production to gambling. The following is a list of the excluded investment categories:

  • Financial institutions, consumer banks, and commercial lenders
  • Gambling, speculative investments and derivatives
  • Alcohol and tobacco
  • Military
  • Adult entertainment
  • Pork
  • Leverage

In light of the significant volatility of the fund, investors are recommended to remain invested for a minimum of five years. The longer timeframe is required to achieve stable returns.

Amanah KiwiSaver fund fees

The Amanah KiwiSaver scheme primarily comes with four types of fees:

  • Management fee. Amanah charges a 1.39% management fee for its role in managing compliance with its investment mandate and monitoring costs.
  • Administrative costs. A fee of 0.39% will also be charged to compensate Amanah Ethical for administrative activities such as accounting and audits.
  • Membership fee. A yearly fee of $32.40 will be directly deducted from your Kiwisaver balance.
  • Performance fee. Although not clearly outlined, Amanah has the leeway to leverage an additional performance fee if investment returns exceed a pre-set benchmark.

      Remember to check with Amanah Ethical on the exact fund fees you might have to pay before investing. Do note that the actual amount in fees could differ depending on your fund type and KiwiSaver balance.

      What other products does Amanah offer?

      Amanah Ethical also offers a managed investment trust — Amanah NZ.

      While this trust invests in a similar basket of stocks as the KiwiSaver scheme, it is purely a growth fund. This means that it invests solely in U.S. equities such as Alphabet Inc. (the parent company of Google) and Bristol-Myers Squibb Company.

      Amanah NZ has the potential to offer higher returns than the KiwiSaver scheme but comes with a higher risk as well.

      How do I join the Amanah KiwiSaver scheme?

      To join Amanah KiwiSaver, visit Amanah’s website and read through the product disclosure statement. Following this, fill in the application form at the back of the statement. You may be asked to provide additional documents to verify your identity and address such as a copy of your passport, birth certificate, New Zealand driver’s license or bank statement with your address printed on it.

      Submit your completed form and supporting documents to Amanah by mail. Once these have been processed, Amanah Ethical will get in touch with you about your application. In the event that you already have an existing KiwiSaver scheme provider, Amanah will take care of the account transfer process for you.

      Eligibility criteria

      To invest in Amanah’s KiwiSaver fund, you must first be eligible to join their scheme. You need to be:

      • A New Zealand citizen
      • Entitled to live in New Zealand indefinitely

      If you hold a temporary student, visit or work permit, you may not be eligible for the KiwiSaver scheme.

      Our verdict

      Amanah offers a unique Shariah-compliant impact investing KiwiSaver plan. It offers high growth in exchange for a higher level of risk. If you are looking for a Shariah-compliant KiwiSaver that values sustainable investing and delivers strong long-term returns, Amanah KiwiSaver is worth considering.

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