Monthly income and great returns with Squirrel’s Managed Fund
Squirrel's Monthly Income Fund offers a simple way to invest in a managed fund with a great regular return that you can set and forget.
The 1 year fund return is 7.45%p.a.* and with a PIE based tax rate of 28% maximum, if you're on a higher tax bracket than most it's worth checking out.
*1 year fund return as at 30/11/24. After fees, before tax.
*1 year fund return as at 30/11/24. After fees, before tax.
Features of the Squirrel Monthly Income Fund
Regular income
Income paid or reinvested each month
Reserve fund protection
Helps ensure you get your monthly returns whatever happens
Great for high earners
The benefit of a PIE based tax rate with maximum 28%
30 days notice
Get your money out at no cost within 30 days
Keen to find out more?
Check out the latest performance of the Monthly Income Fund here.
The Monthly Income Fund’s investments are protected by Squirrel’s Reserve Funds
When Squirrel lends out your investor money to borrowers for things like Home Loans and Construction Loans, a small portion of the interest paid by all our borrowers goes into a reserve fund which builds up over time.
Even if a borrower misses a repayment, you the investor still gets your regular interest payment from the reserve fund.
This model is unique to NZ and whilst we can't guarantee the future, so far no investor interest or principal repayments have ever been missed by Squirrel.
How is your money being invested?
The Squirrel Monthly Income Fund is a managed fund seeking to generate a competitive and regular income from a diversified portfolio of NZ loans secured by registered first mortgages over NZ residential properties. Squirrel focuses on mortgage lending to select market niches (including Home Loans and Construction Loans) where investors can expect to earn attractive returns from carefully qualified borrowers with residential property as security.
As the Fund’s investments are protected by Squirrel’s reserve funds, the Fund continues to receive monthly interest payments where any borrowers happen to be in arrears.
Home Loans
These are loans for homeowners that are secured by a first mortgage over residential property, with maximum 80% LVR. All our borrowers are checked by our experienced credit team. This investment class is considered conservative risk level.
Construction Loans
Lent out to builders and small-scale property developers with a maximum loan size of $2m. All our borrowers and their developments are checked by our experienced credit team. All loans are secured by a first mortgage over residential property, with maximum 70% LVR. This investment class is considered moderate risk level.
Investment objective and strategy
- The Monthly Income Fund’s investment objective is to provide an annual return, after fees and before tax, that outperforms the 1 Year New Term Deposit Rate (>$10k) by a margin of 2.00%*.
- The Fund combines Squirrel’s real estate lending expertise into a convenient, tax-effective form where investors receive returns from a diverse portfolio of home loans and residential construction loans with first ranking security against residential property.
- Squirrel is the Investment Manager and the Fund invests in the Squirrel Wholesale Home Loan Fund and the Squirrel Wholesale Construction Loan Fund. Squirrel actively manages the Squirrel Wholesale Funds’ loan exposure through Squirrel’s peer-to-peer (“P2P”) platform.
Our team is happy to talk you through any of your questions or concerns about the managed fund, simply book in a time that suits and we'll call you back.
*The Fund’s investment objective is to provide an annual return, after fees and before tax, that outperforms the 1 Year New Term Deposit Rate (>$10k) by a margin of 2.00%, effective from 4 September 2023. Prior to this date, the Fund’s investment objective was to provide an annual return, after fees and before tax, of 4.00% higher than the RBNZ Official Cash Rate.
Investor fees & margins
Our lending fees are fair, considered and competitive. There’s nothing vague or hidden with Squirrel and we won’t sting you down the line.
| What it is | Who pays it | |
|---|---|---|
| Service Margin |
Personal Loans 1.45% - 5.95% p.a. of the loan balance deducted from the gross loan repayment. Home Loans and Construction Loans 0.70% - 2.75% p.a. of the loan balance deducted from the gross loan repayment. On-Call Accounts up to 0.25% p.a. being the difference between the interest rate we receive from the bank(s) where your On-Call Account money is held and the interest rate you earn on your On-Call Account balance. |
Charged to the Investor by deducting from the Borrower’s repayments. The applicable service margin is dependent on the risk grade of the Borrower - lower risk loans carry a lower service margin. The Prevailing Interest Rate published on our website for each Investment Class or On-Call Account is the rate net of the Service Margin and Reserve Levy (if any). |
| Reserve Levy |
0.10% - 3.25% p.a. of the loan balance deducted from the gross loan payment. |
The Reserve Levy for each loan is dictated by the assessed credit risk of the borrower. Reserve Levies are held on Trust for the benefit of Investors. The Reserve Levy is charged against the gross investor return. The Prevailing Interest Rate for each investment class is the rate net of the Service Margin and Reserve Levy. |
| Annual fund charges |
Peer to peer term investments: no annual fund charges Squirrel Monthly Income Fund: 2.00% p.a. incl GST Squirrel Wholesale Home Loan Fund: 0.25% p.a. incl GST Squirrel Wholesale Construction Loan Fund: 0.25% p.a. incl GST |
Squirrel Monthly Income Fund, Wholesale Home Loan Fund, and Wholesale Construction Loan Fund annual fund charges are deducted monthly from distributions. |
How we lend to quality, creditworthy borrowersWe do our due diligence on every borrower that applies for a loan to ensure they're creditworthy, have the capacity to service ongoing loan repayments and that it is responsible to lend them money. We have a credit scorecard that determines their credit risk grade and as a result the amount of reserve levy they pay into the Reserve Fund.
We do our due diligence on every borrower that applies for a loan to ensure they're creditworthy, have the capacity to service ongoing loan repayments and that it is responsible to lend them money. We have a credit scorecard that determines their credit risk grade and as a result the amount of reserve levy they pay into the Reserve Fund.
Identity Verification
We take an image of the borrower’s NZ driver’s licence or NZ Passport and check its validity. We also verify email addresses and mobile phone numbers.
Credit Checks
We check the borrower’s credit history with Equifax and Centrix to make sure they don’t have outstanding debts or credit card bills from doing something silly like Uber-ing a helicopter.
Reserve Levy
A portion of every borrower payment goes into the relevant reserve fund. Their interest rate is based on their individual risk profile. Those with a higher risk profile pay a higher interest rate, allowing us to put more into the reserves.
Affordability
We check a borrower’s ability to service the loan by looking at their disposable income and expenses. This is to ensure they can afford the loan and won’t miss repayments if something goes wrong.
Transparency is key
Here you’ll find reporting on our Monthly Income Fund so you can dig into as much detail as you like about how our investments are going.
While past performance doesn’t guarantee the future, these reports will help give you an idea of how our Fund has been doing, and what it’s all about.
Looking for more information on the Monthly Income Fund? Check out our Product Disclosure Statement here.
Ready to get started?
Register to invest online in today.
We jump through hoops so you have peace of mind
- Squirrel is licensed and regulated as a peer-to-peer lender and a financial advice provider by the FMA (Financial Markets Authority).
- Our Board of Directors packs a punch, and each year we're financially audited by KPMG who also do a custodial review of the internal processes we use to manage your money. So you can be sure no stone is left unturned.
- We custom-built a world-class platform with tons of cyber-security in place.
- We make no compromises when it comes to security and technology. We operate on the Microsoft Cloud with best-practice IT security and monitoring.
Michael, Christchurch
New Zealand
"I've been investing for over 6 months and found the process easy to use. Interest paid without question and fully transparent. Seminars are reassuring on current events and updates. Great to see interest is being paid on money awaiting investment and now I will keep all interest gained within the account rather than drawing down. Highly recommended - give it a go and be pleasantly surprised."
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