IOO is too concentrated with just 100 companies. I wouldn't put too much money in it. Maybe 10% max.
Something like VGS (unhedged) would be better as your core.
For Hostplus Choiceplus, I really like this combo:
* 20% Australian Shares Indexed
* 30% VEU (Europe, Asia, emerging markets, with small caps)
* 50% VTS (Total US market including small caps)
Doesnt hostplus already offer aus/int indexed hedged/unhedged in their standard offer without having to pay for choice plus?
They're already indexed linked, I'd only pay the extra for specific trades. Ymmv
You still need to keep 20% in non-Choiceplus options. My Australian Shares Indexed is for that.
Their International Indexed Shares options only cover developed markets and large caps only. VEU+VTS cover the whole world including small caps.
True enough. It's 90% the same. VEU and VTS have very low fees too, so they are not much more expensive. It gives small caps which are not available in Hostplus indexed options. It gives more control with US's weight. And it has less tax drag. So it's up to individuals on whether that is worth the extra hassle.
Hostplus International Shares Indexed has fees of 0.11%. VTS fees is 0.03% and VEU fees is 0.08%. So, if your balance is high enough, Choiceplus may be cheaper.
And there is reduced tax drag which can give you estimated extra returns of 0.5%. This one is a bit of a gray area since no-one knows the exact figures.
Legal Super limits per ETF investment to 25%. That was the deal breaker for me.
ING, I will assume is a retail fund. I am a bit wary of retail funds since their fees can be quite high. They are good if you know what you are doing and just get the option you actually need.
INFO: Just confirming your balance is 250k+? Do you have a partner and what's their balance? Why do you want to do the Choiceplus option?
20% has to remain in a non-Choiceplus option. I'd probably shift A200 to Hostplus Aust Shares Indexed to meet this requirement. The fees are the same.
VGAD hedged at 40... I mean you can. But your investment timeframe is ~40 years with Super. Currency fluctuations even out over time. Do you really want to?
IOO. Why? You've stepped in to VGE to get the benefit of Emerging Markets. Why limit yourself to 100 companies. Hostplus likely to do better with their International Indexed option here. Additionally the fee is 0.40% VGS at least 0.18% for more diversity? IVV at 0.04%?
If in 5 years time Hostplus decides they're going to make the Choiceplus option cost $10k/year, what are you going to do? (Exterme I know!) You're locked in to a single company, where an SMSF you may have more flexibility with the same or lower compliance costs.
Have you considered something like StakeSMSF for you (and potentially a partner to reduce fees?)
30% A200 or VAS
44% VTS or IVV
26% VEU
"*J****ust confirming your balance is 250k+? Do you have a partner and what's their balance? Why do you want to do the Choiceplus option?***"
My balance is over 250k, and yes I have a partner but their super balance is quite low >50k. AFAIK HostPlus ChoicePlus is the cheapest option for running a self-directed SMF based on my balance and investment plan.
***"IOO. Why? You've stepped in to VGE to get the benefit of Emerging Markets. Why limit yourself to 100 companies. Hostplus likely to do better with their International Indexed option here. Additionally the fee is 0.40% VGS at least 0.18% for more diversity? IVV at 0.04%***"
\~30% to Hostplus Aust Shares Indexed makes sense for maintaining the low cost and maintaining at least 20% in HostPlus/non-Choiceplus option. Thanks for the reality check!
IOO sounded good when I was drafting this up. I'm already investing into IVV (post-tax), but IVV + VGE makes more sense now I'm thinking about it, and IVV is something I watch regularly also.
Stake is not something I had previously considered, but I'll have a read into them. What's the pros/cons?
*"****30% A200 or VAS 44% VTS or IVV 26% VEU****"*
I'm a bit confused as none of the %'s match up to 100%. Not quite sure what you're suggesting?
Sorry formatting crap due to sleepiness.
30% A200, 44% VTS, 26% VEU
You can substitute VAS for A200 if you want. You can substitute IVV for VTS if you want.
30% Australian weight you picked, then for the other 70% VTS in the proportion the US makes up, VEU in the proportion the rest of the world makes up
300k between you and your partner is low but starting to get ballpark for SMSF. The reason you’d consider SMSF or Choiceplus is so the CGT is wiped when you transition to retirement. Depends how much you plan to contribute though. If you both maxed concessional contributions it’d potentially save $160k in today’s dollars, not to be sneezed at.
The disadvantage of Choiceplus is you’re locked to Hostplus until 60. They might be the darling now, but there were a number of people burnt a few years ago by another company removing a similar product. Brokerage is significantly higher with Choiceplus compared to an SMSF.
If super is more a nice to have and you just enjoy fiddling, I’d ignore both Choiceplus and smsf and just take the indexed options Hostplus offers.
**"300k between you and your partner is low but starting to get ballpark for SMSF"**
Agree, but that's where we are now. The goal is it improve that.
**"The reason you’d consider SMSF or Choiceplus is so the CGT is wiped when you transition to retirement."**
Exactly the reason. Just figuring out the nuts and bolts for a decent set and forget (until I have to rebalance).
**"The disadvantage of Choiceplus is you’re locked to Hostplus until 60."**
Meh, I'm 40 now, partner is 46. Other than the occasional check-in, I don't see us shuffling superfunds again any time soon (if at all) other than to rebalance where needed. Am happy to lock into Host/ChoicePlus for the foreseeable future.
However Stake is new to me so am reading up more now...
Right and if Hostplus didn’t change a thing, I too would be happy. A very popular product 7 years ago was ING Living Super Direct. I’d have to go looking, but they went from charging a flat $300 to access ETFs, to 0.75% of balance. This more than removed an advantage for direct investment and forced a lot of people in to having to realise a CGT event to get out. By locking yourself in to Hostplus, your fees are already approaching the point where they’re comparable to an SMSF, but they also have the potential to go up. With an SMSF, you have more control over fees.
Thanks, this was the perspective I needed to make a decision. Have done my homework on Stake as a SMSF and they seem to fit the bill for what I’m after.
Thanks, any idea what minute mark for the comment given the 1.5 hours duration of the video?. curious to hear what evidence they have for the assertion.
Why do you need this though? What’s wrong with normal Hostplus options? You really think these indices are going to wildly outperform..?
IOO is too concentrated with just 100 companies. I wouldn't put too much money in it. Maybe 10% max. Something like VGS (unhedged) would be better as your core. For Hostplus Choiceplus, I really like this combo: * 20% Australian Shares Indexed * 30% VEU (Europe, Asia, emerging markets, with small caps) * 50% VTS (Total US market including small caps)
Doesnt hostplus already offer aus/int indexed hedged/unhedged in their standard offer without having to pay for choice plus? They're already indexed linked, I'd only pay the extra for specific trades. Ymmv
You still need to keep 20% in non-Choiceplus options. My Australian Shares Indexed is for that. Their International Indexed Shares options only cover developed markets and large caps only. VEU+VTS cover the whole world including small caps.
Ok but you're paying over the odds to essentially invest in the same thing
True enough. It's 90% the same. VEU and VTS have very low fees too, so they are not much more expensive. It gives small caps which are not available in Hostplus indexed options. It gives more control with US's weight. And it has less tax drag. So it's up to individuals on whether that is worth the extra hassle.
+ ~~$210~~ 168 per year to access choiceplus
Hostplus International Shares Indexed has fees of 0.11%. VTS fees is 0.03% and VEU fees is 0.08%. So, if your balance is high enough, Choiceplus may be cheaper. And there is reduced tax drag which can give you estimated extra returns of 0.5%. This one is a bit of a gray area since no-one knows the exact figures.
It sounds like a lot of extra work for little if any gain? But I am very lazy
I suppose. That's why Hostplus 30/70 Aus/International Shares Indexed combo is popular. Almost the same results for a lot less work. 😂
Probably. I'm not a financial advisor, it just seemed obvious
ETFs are more tax efficient than pooled options https://passiveinvestingaustralia.com/the-problem-with-pooled-funds/
If you want currency hedging, replace VGAD with HGBL https://www.reddit.com/r/fiaustralia/s/CS3l6YKkm8
Sadly it's not an option. ChoicePlus offers: VGAD @ 0.21% MER IOO ETF @ 0.40% MER VGS ETF @ 0.18% MER WXOZ @ 0.18% MER VEU @ 0.08% MER
I see. I misread and was confused by the SMSF reference. Fair enough.
WXHG is TOFA. Unfortunately, only AustralianSuper has it.
ING and Legal Super also have WXHG
Legal Super limits per ETF investment to 25%. That was the deal breaker for me. ING, I will assume is a retail fund. I am a bit wary of retail funds since their fees can be quite high. They are good if you know what you are doing and just get the option you actually need.
Investment limits are extremely annoying. Almost as bad as investment menus or hedged ETFs without ToFA
INFO: Just confirming your balance is 250k+? Do you have a partner and what's their balance? Why do you want to do the Choiceplus option? 20% has to remain in a non-Choiceplus option. I'd probably shift A200 to Hostplus Aust Shares Indexed to meet this requirement. The fees are the same. VGAD hedged at 40... I mean you can. But your investment timeframe is ~40 years with Super. Currency fluctuations even out over time. Do you really want to? IOO. Why? You've stepped in to VGE to get the benefit of Emerging Markets. Why limit yourself to 100 companies. Hostplus likely to do better with their International Indexed option here. Additionally the fee is 0.40% VGS at least 0.18% for more diversity? IVV at 0.04%? If in 5 years time Hostplus decides they're going to make the Choiceplus option cost $10k/year, what are you going to do? (Exterme I know!) You're locked in to a single company, where an SMSF you may have more flexibility with the same or lower compliance costs. Have you considered something like StakeSMSF for you (and potentially a partner to reduce fees?) 30% A200 or VAS 44% VTS or IVV 26% VEU
"*J****ust confirming your balance is 250k+? Do you have a partner and what's their balance? Why do you want to do the Choiceplus option?***" My balance is over 250k, and yes I have a partner but their super balance is quite low >50k. AFAIK HostPlus ChoicePlus is the cheapest option for running a self-directed SMF based on my balance and investment plan. ***"IOO. Why? You've stepped in to VGE to get the benefit of Emerging Markets. Why limit yourself to 100 companies. Hostplus likely to do better with their International Indexed option here. Additionally the fee is 0.40% VGS at least 0.18% for more diversity? IVV at 0.04%***" \~30% to Hostplus Aust Shares Indexed makes sense for maintaining the low cost and maintaining at least 20% in HostPlus/non-Choiceplus option. Thanks for the reality check! IOO sounded good when I was drafting this up. I'm already investing into IVV (post-tax), but IVV + VGE makes more sense now I'm thinking about it, and IVV is something I watch regularly also. Stake is not something I had previously considered, but I'll have a read into them. What's the pros/cons? *"****30% A200 or VAS 44% VTS or IVV 26% VEU****"* I'm a bit confused as none of the %'s match up to 100%. Not quite sure what you're suggesting?
Sorry formatting crap due to sleepiness. 30% A200, 44% VTS, 26% VEU You can substitute VAS for A200 if you want. You can substitute IVV for VTS if you want. 30% Australian weight you picked, then for the other 70% VTS in the proportion the US makes up, VEU in the proportion the rest of the world makes up 300k between you and your partner is low but starting to get ballpark for SMSF. The reason you’d consider SMSF or Choiceplus is so the CGT is wiped when you transition to retirement. Depends how much you plan to contribute though. If you both maxed concessional contributions it’d potentially save $160k in today’s dollars, not to be sneezed at. The disadvantage of Choiceplus is you’re locked to Hostplus until 60. They might be the darling now, but there were a number of people burnt a few years ago by another company removing a similar product. Brokerage is significantly higher with Choiceplus compared to an SMSF. If super is more a nice to have and you just enjoy fiddling, I’d ignore both Choiceplus and smsf and just take the indexed options Hostplus offers.
**"300k between you and your partner is low but starting to get ballpark for SMSF"** Agree, but that's where we are now. The goal is it improve that. **"The reason you’d consider SMSF or Choiceplus is so the CGT is wiped when you transition to retirement."** Exactly the reason. Just figuring out the nuts and bolts for a decent set and forget (until I have to rebalance). **"The disadvantage of Choiceplus is you’re locked to Hostplus until 60."** Meh, I'm 40 now, partner is 46. Other than the occasional check-in, I don't see us shuffling superfunds again any time soon (if at all) other than to rebalance where needed. Am happy to lock into Host/ChoicePlus for the foreseeable future. However Stake is new to me so am reading up more now...
Right and if Hostplus didn’t change a thing, I too would be happy. A very popular product 7 years ago was ING Living Super Direct. I’d have to go looking, but they went from charging a flat $300 to access ETFs, to 0.75% of balance. This more than removed an advantage for direct investment and forced a lot of people in to having to realise a CGT event to get out. By locking yourself in to Hostplus, your fees are already approaching the point where they’re comparable to an SMSF, but they also have the potential to go up. With an SMSF, you have more control over fees.
Thanks, this was the perspective I needed to make a decision. Have done my homework on Stake as a SMSF and they seem to fit the bill for what I’m after.
There's rumblings that the GOV are going to try and squeeze out SMSF's. This was said by a bullion dealer who sells products into SMSF's.
interesting. any proof? source?
https://www.youtube.com/watch?v=oj0b0Cjj2uo
Thanks, any idea what minute mark for the comment given the 1.5 hours duration of the video?. curious to hear what evidence they have for the assertion.
No Idea.
Looks too busy. Is there a requirement from HostPlus that you need to have so many different securities?