Investment, fees & taxes
One portfolio, low fees, tax minimised.
Every member’s money goes into the same low-cost, diversified mix. Here’s exactly how it’s built, what it costs to be invested, and what it means at tax time.
- VAS · 50%
- Vanguard Australian Shares Index ETF. A slice of roughly 300 of the biggest companies listed on the ASX — banks, miners, retailers, and more. This is half tracks the Australian ASX Index.
- IHVV · 50%
- iShares S&P 500 AUD Hedged ETF. The 500 largest companies in the US, currency-hedged so exchange-rate swings don't distort your returns. This half tracks the US S&P500 Index.
How your return works
Because you’re split 50/50 between Australian and US shares, your return in any given year is roughly a blend of how each market performed — weighted evenly.
For example
+10%
US market (IHVV)
+12%
Australian market (VAS)
+11%
Your investment
A simplified example to show how the blend works. Real returns move independently in each market and can be negative as well as positive — this isn’t a forecast.
Dividends
Companies pay some of their profit straight to shareholders in cash — that’s a dividend. VAS and IHVV collect the dividends from everything they hold and pass them on to you automatically, usually every few months.
VAS has historically paid out somewhere around 3.5–4% a year. IHVV, tracking the US market, has typically paid out much less — often just over 1% — and its distributions can be uneven year to year because of currency hedging. Because you’re invested 50/50, your dividend return is roughly the average of the two.
Source: VAS distribution history↗Source: IHVV distribution history↗
For example
If your investment has an average dividend yield of 5% and you’ve got $1,000 invested, you’d receive $50 in cash from dividends that year.
Round numbers, to show the maths — not our actual yield.
Fees
What it costs to be invested.
We’re not-for-profit, so every fee below exists to cover a real cost — not to generate a return for anyone. No hidden extras, no surprise line items.
0.5%
of your total investment, per year
Management fee
This is the big one, and the one we're most focused on bringing down. It covers our operational costs — as minimal as they are. Because we're not-for-profit, we aim to reduce this fee over time, and where we can, refund fees already paid. It comes out of your cash balance, which is often topped up by dividends, so you usually won't need to deposit more just to cover it.
0.1%
of each amount invested
Transaction fee
Charged once, when a deposit is actually invested. This covers the cost of placing the trade in the market.
2%
of the amount withdrawn, within 2 years
Early withdrawal — under 2 years
We want your money invested for the long run, so withdrawing early comes with a penalty. Withdrawals are matched against your earliest deposits first.
1%
of the amount withdrawn, 2–5 years
Early withdrawal — 2 to 5 years
A smaller penalty for withdrawing after two years but before five. After 5 years, there's no withdrawal fee at all.
Withdrawals are matched against your earliest deposits first, so the fee that applies is based on how long that money has actually been invested.
Why we’re not-for-profit →Taxes
What taxes will I pay?
There are two types of tax that apply to your investment.
Dividends
On the cash payments you receive from dividends, you'll be charged income tax — just like on any other income.
Source: MoneySmart — Investing and tax↗Capital gains
When you sell, you'll be charged capital gains tax. This is a different type of tax to income tax, and how much you owe depends on your own situation — you'll need to talk to your accountant to work it out. We'll give you all the numbers you need (what you paid, what you sold for, and when) to do that.
Source: MoneySmart — Investing and tax↗This is general information, not personal tax advice. Your own situation may differ — speak to a registered tax agent or accountant about what applies to you.