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How to choose a KiwiSaver provider


Whether you’re choosing your first KiwiSaver provider or getting ready to make a switch, let’s go over some things you might want to think about. 

Collage of a bird pecking at paper fruit.

Know your options 🍎🍍🍐

With so many KiwiSaver providers available, a good place to start is familiarising yourself with what’s out there, and how they differ.

Lots of organisations offer a KiwiSaver scheme, like:

  • Banks 

  • Fund managers 

  • Insurance providers 

  • KiwiSaver-only providers

  • Wealth apps—like Sharesies! 

Some things to consider (aside from the actual scheme each provider offers), are things like:

  • Convenience: Do you already use the provider for something else? Do you value being able to see your KiwiSaver balance next to your other accounts?

  • User experience: Will you be able to access your KiwiSaver balance on the go? Will it be easy to alter your scheme?

  • Customer service: What kind of support does the provider offer? How quickly can they resolve an issue? 

  • Brand values: Do you like the provider? Do your values align? Do you think the provider will be around for the long term?

Prioritise what you’re looking for 🔎

Before you get any further, it’s a good idea to check in with yourself to figure out your top KiwiSaver priorities. For example, are you most concerned with paying the lowest fees? Having the most actively managed scheme? Ethical investing? And so on. Once you’ve sorted this, you can keep these key things in mind while you narrow down your search.  

Pick a scheme structure 🏗️

KiwiSaver schemes are generally structured one of two ways—as a traditional or self-select scheme. 

Traditional schemes are usually made up of a range of funds, of which you choose one to invest your KiwiSaver balance and future contributions into. The funds typically fall into three categories based on risk

  • conservative funds invest in lower-risk investments like bonds and cash

  • balanced funds invest in a mix of higher and lower-risk investments

  • growth funds invest in higher-risk investments, which tend to fluctuate more in value but offer the possibility of higher returns.

Self-select (or self-managed) schemes allow you to pick the investments that your KiwiSaver balance and future contributions are invested into. For example, with the Sharesies KiwiSaver Scheme, you will be able to select a base fund and then have the option to add individual companies and exchange-traded funds (ETFs) to your KiwiSaver investment plan. 

If you like the idea of having more choice and control over where your KiwiSaver balance is invested, you might gravitate towards a self-select scheme structure. If this doesn’t bother you, a traditional structure might appeal.

Compare funds ⚖️

Whether you’ve opted for a traditional or self-select scheme structure, you’ll likely need to pick a fund to invest the bulk of your KiwiSaver balance and future contributions into. Here are some terms that can help you understand what kind of fund might suit your personal situation. 

Investment timeframe 

Providers usually indicate what kind of ‘investment timeframe’ the fund is designed for. A KiwiSaver investment timeframe is the amount of time you have until you expect to use your KiwiSaver balance. So if you’re looking at a fund with a recommended timeframe of 10+ years, and you know you want to use your balance for a first home deposit in the next 5 years, you might decide that fund isn’t the best option for you. 

Risk rating 

Another thing to look at is a fund’s ‘risk rating’, which is usually a number from 1–7. One being the lowest, and seven being the highest risk category. This suggests the kind of investments that make up the fund, how much the value of the fund is likely to fluctuate, and what kind of returns the fund is hoping to achieve. For example, a fund with a high-risk rating will likely be made up of higher-risk investments, experience higher levels of volatility, and aim to generate higher returns over the long term. 

You can compare a fund’s risk rating to your personal risk appetite. And since your risk appetite is tied to your investment timeframe, a general rule of thumb is: the longer your investment timeframe, the higher risk rating you can consider. But remember, risk is personal! 

Investment style

KiwiSaver funds can be actively or passively managed. An actively managed KiwiSaver fund relies on decisions by the manager on what investments the fund buys or sells, while a passively managed fund aims to copy what the market is doing by tracking or investing in an index.

Actively managed KiwiSaver funds generally charge higher fees. This is because it takes more time and money for the fund manager to analyse and monitor investments. And while people usually opt into an actively managed KiwiSaver fund in the hopes that it will achieve higher returns on their KiwiSaver balance, know that returns are never guaranteed—even the most skilled investment manager can get it wrong. 🔮 

Since a self-select KiwiSaver scheme enables you to pick your own investments, you can customise how actively your scheme is managed, and do some of the managing yourself! For example, you could invest 90% of your KiwiSaver balance in an actively or passively managed base fund, then invest your remaining balance in your own picks (which you’ll need to monitor yourself). 

Put it all together 🤲

By now, you should have a pretty good idea of what KiwiSaver providers are available, what kind of scheme you might be interested in, and the type of KiwiSaver fund that could work for you. These days it’s super easy to sign up to KiwiSaver or switch from an existing provider—you’ll probably just need to let your new provider know and they’ll handle the rest! 😎

If you’re still not sure—no sweat! There are other resources that might help you make a decision, like Inland Revenue’s website and Sorted’s KiwiSaver fund quiz. Remember, you’re not locked into a KiwiSaver scheme forever—you always have the option to switch providers if you want.

Ok, now for the legal bit

Investing involves risk. You aren’t guaranteed to make money, and you might lose the money you start with. We don’t provide personalised advice or recommendations. Any information we provide is general only and current at the time written. You should consider seeking independent legal, financial, taxation or other advice when considering whether an investment is appropriate for your objectives, financial situation or needs.

Sharesies Investment Management Limited is the issuer of the Sharesies KiwiSaver Scheme. The product disclosure statement (PDS) for the Sharesies KiwiSaver Scheme has been lodged, and may be viewed on the Disclose Register or on our documents page.

Join the KiwiSaver scheme that’s more you

Portfolio displayed is a guide, not from a real customer. For informational purposes only.
A young woman looking off to the side holds a lime-green electric guitar. Superimposed next to her is an iPhone showing a screen in the Sharesies app. The screen shows a KiwiSaver investment portfolio, made up of the Pathfinder Ethical Growth Fund, the Smartshares NZ Top 50 Fund, Meridian Energy, and Infratil.