KiwiSaver was introduced by the Government in 2007. With almost 3,000,000 members as at March 2019, the uptake of KiwiSaver has been pretty well received by New Zealanders.

However, there is still a lot of confusion around how KiwiSaver works. Many Kiwis missed out on some or all of the Government contribution last year.

Most of my work with clients is education. I explain how the Government and employer contributions work and I help clients to understand how to select their investment funds.

Ongoing client work is more about keeping clients on task. Don’t get excited about market peaks and don’t get anxious when the market drops. Plan the course and stick to the plan. Easy to say, but the reality is very different to the theory.

Some of the key mistakes that people make:

Staying in a Default fund. This is a conservative fund that new members are automatically allocated when they first join KiwiSaver, if they don’t select a provider and investment fund themselves.

Being in a Growth fund just before you retire, or before you buy your first home. Your fund selection should fit the timeframe available to you. If you need the funds in the next year or two, then being invested in a higher-risk fund does not make sense. Likewise, if you can’t touch your money for 30 years, a Conservative fund is probably not appropriate.

Does your KiwiSaver need a review?