April 11, 2022
We’re Renovating the Financial Services Industry, Kernel Style.
Like most Kiwis, we love a good reno. But our idea of a renovation is tackling the financial services industry, not just a property. Today marks the start of our big (and we mean BIG) renovation project.
For as long as we can remember, New Zealand has always been left one step behind when it comes to financial services. We were 15 years behind Australia in adopting a retirement scheme and 42 years behind the USA.
It's only in the last couple of years that New Zealand has seen the rise of new investment platforms. Forcing a welcome refreshment of how we approach investing.
And while we now have access, there is still plenty of work to be done to help Kiwis become great investors.
The industry needs more than just a lick of paint
This reno isn’t just adding a new deck or replacing the carpet. It’s rebuilding the whole house from the ground up.
We must unlearn most of what we know about money and investing and look at things with a new perspective. Because what has worked in the past isn’t necessarily going to work moving forward.
Property is becoming more and more unattainable. Keeping our money in a bank isn’t going to get us to our long-term financial goals in today’s low-interest rate environment. And keeping our heads in the sand, while we live paycheque to paycheque isn’t going to get us to financial freedom either.
What will get Kiwis to a secure financial future is better access to high quality financial expertise and products that won’t cost an arm and a leg along the way. That’s where we come in.
Kernel gives you financial tools that’ll last a lifetime
We understand that renovating an industry is a big job. That’s why we’ve started by offering Kiwis what we believe are the best index investment funds in NZ. A range of local, global, thematic and sustainable funds that support Kiwis in getting to their long-term financial goals.
We’re also proud to be a customer-led company; one that truly puts you, our investors, at the centre of every decision we make. From which products to build, to how we structure our pricing, to how our customer success team gets you the best outcome possible. We're keeping you in mind every step of the way.
Looking forward, we're combining our financial expertise and world-class technology to bring you an all-inclusive personal finance platform. While there is no one-size-fits-all-approach, we’re giving you the opportunity to bring everything into one place and manage your money without lifting a finger.
Alongside Kernel Invest, the Kernel KiwiSaver Plan we will soon be introducing, Kernel Save, so you can save for your short and medium-term goals while your long-term investments work away in the background.
More than just an all-inclusive platform, we remain committed to putting our investors’ (that’s you!) needs before our own, in all facets of our business and products. We are quite literally willing to fill your pockets before ours, adapting our fees to ensure you’re better off in the long term.
Introducing the star of the show – Kernel 3.0
Now, we’ve touched on what this entails but let's dive into the nuts and bolts of our new product offerings and updated pricing structure.
We’ve given our fees a new lease on life
The future you want shouldn't cost a fortune! We truly only do something if it benefits our customers. Aligned to this commitment, we are pleased to announce that we have reduced our fund management fees across the board. That's right - lower fees for all investors.
Effective the 4th April, our ten core funds have their annual management fee reduced to 0.25% and our three thematic funds reduced to 0.45% p.a.
A change to the platform fee
We are increasing our platform fee for Invest from $3 to $5 per month, as by doing this we can offer a subscription like investing experience with lower management fees. This will have a far greater impact over your investing life!
Knowing that many want to get started on their investment journey, we have also removed our platform fee for portfolio balances under $25,000. This means you can start investing for yourself, your kids or grandkids, with as little as $1 and only pay the fund management fees.
Let's be frank: our fees align to your interests
We believe in calling a spade a spade; so here it is. We strongly believe that platforms whose revenue is tied to your investment actions are not in an investors' best long-term interests. We don't charge you transaction, brokerage or foreign exchange fees every time you invest (buy and sell).
We want our customers to have the freedom to invest in large amounts, small amounts, every week or every month - without having to consider these extra costs. We also don't need to encourage you to buy or sell regularly for Kernel to make money; we grow when your balance grows. That's why we have a fixed platform fee of $5 per month (for portfolios over $25k).
We’ve built on our fund range
An investor favourite, we're welcoming the Kernel S&P 500 Fund into the fold. Whilst we continue to love the global diversification that our Global 100 Fund provides, we know many simply love ye olde S&P 500. So, as they say, give the people what they want! Although ours has a twist to minimise the impact of New Zealand dollar fluctuations through currency hedging, this means you get similar performance as that of a US investor and as published in the media.
If that wasn't enough, we're also excited to introduce the Kernel High Growth Fund - a fund made up of several Kernel funds and the foundation of Kernel's KiwiSaver Plan. A fund invested in 98%+ equities, it's a suitable option for those with long time horizons.
Why stop there? Say hello to the Kernel KiwiSaver Plan
We're here to make KiwiSaver one of the best things about getting older!
We know that retirement investing isn't one-size-fits-all. You can choose for your KiwiSaver to be invested in our High Growth Fund or you can DIY it – and pick the Kernel funds you’d like to have in your KiwiSaver plan.
Right now, the Kernel KiwiSaver plan offers only growth funds, investing in equities and listed property. We know that won't be appropriate for everyone, so more conservative fund options are also on their way. But for now, if home ownership is behind you and retirement is many, many years away, the Kernel KiwiSaver Plan could be an option for you!
Saving the best for last – Kernel Save is coming soon
Kernel Save is the high-interest savings account you’ve been waiting for.
Perhaps you’re not quite ready to take the leap into investing, are looking for a safe separate place to put emergency savings or maybe you’re simply looking for a way to earn some extra interest whilst saving up for a car/wedding/trip! Kernel Save enables you to work towards your short-term goals, without sacrificing your returns.
Access to Kernel Save will be launching in early May and in the meantime, read more about its features below.
Our one goal: Help Kiwis be great investors
While it might feel like there are a lot of changes happening, we want to reiterate that our mission hasn't. We're laser-focused on creating a world where everyone has the same access to the best financial freedom tools.
We believe you deserve to come from an empowered, educated position with your finances.
Not because you chose 4 individual stocks that just happened to take off but because you’ve taken a well thought through, disciplined (and proven!) approach to investing. You’ve come out the other side better off, with the financial knowledge to match. Our goal is for investing to become an engrained intergenerational habit for your family and beyond.
We don’t want you to just be investors, we want you to be great investors.