New KiwiSaver provider attracts thousands

Sam Stubbs says his new not-for-profit KiwiSaver scheme Simplicity has already attracted thousands of registrations. Photo/Janna Dixon.

The country's newest KiwiSaver provider says thousands of people have already registered to sign up with it - exceeding its 12 month target.

Not-for-profit provider Simplicity was launched on August 1 by former Tower and Westpac executives promising to shake up the industry and save the average member up to $65,000 by the time they retire.

Managing director Sam Stubbs, who previously headed up Tower's investment business, said initial demand for Simplicity had been very strong and it would now begin to move people from its waiting list into the scheme.

"The platform has been thoroughly tested, and has passed with flying colours. It's now fully functioning, industrial strength and ready to make Kiwis richer in retirement.

"We've already reached our 12 month targets. Thousands have registered interest, and we are now making Simplicity fully available to them", he said.

Stubbs said it had also been appointed by power company Genesis Energy as a preferred supplier, and was being recommended by two financial provider networks.

Simplicity will use US low-cost fund manager Vanguard which employs a passive investment approach.

Passive funds track market indices and cost less than active funds where stock trading requires more work.

Based in Pennsylvania, Vanguard manages approximately US$3.4 trillion in assets and has thrived on undercutting fees in the US and around the world.

Fees for the average KiwiSaver are currently 1.3 per cent a year.

Stubbs, who is self-funding the start-up has said Simplicity's administration fee will be just $30 a year, plus a 0.30 per cent a year fund management fee.

More than 2.6 million people are signed up to KiwiSaver with around $34 billion invested.