KiwiSaver: The right fund for retirement

Choosing a KiwiSaver fund can be tough, particularly when you’re nearing retirement or already retired. That’s when every dollar is crucial, and you won’t want to risk your balance going down.

Two big questions to ask

What to think about when you pick a fund type:

  • How long your money will be invested for.
  • How comfortable you are with investing.

We say higher-risk growth funds are probably appropriate if you have at least 10 years of investing ahead of you. Growth funds typically are mostly invested in shares, so you may want time to ride out the highs and lows of the financial markets.

But, if you’re a nervous investor or uncomfortable seeing large ups and downs in your balance, you might opt for a balanced or conservative fund instead.

What if you’re getting close to 65 and will need your money soon?

Balanced funds might suit those who are investing for more than five years. A conservative fund has the least invested in shares, has the best chance of protecting your balance from market dips, and might suit you if you’re less than five years away from using your money.

You don’t have to take it all out, ever

You can get your KiwiSaver money when you reach 65. But you don’t have to take it all out at once. In fact, it may be a good option to keep it invested, and ask your provider to give you a weekly or monthly allowance.

Your KiwiSaver balance might go down slowly over the next, say, 20 years. This means you’ll still benefit from any returns in the market.

If you still have a balance when you die, it’ll become part of your estate and go to your family.

See an expert

It’s a good idea to see an independent financial adviser in your 40s, or before, and every so often after that as you get closer to retirement.

Planning for retirement, and knowing how much you’ll need, varies significantly from person to person. An expert’s advice can help take a lot of the worry out of retirement.

Published 14 January 2020

Pie Funds Management Limited is the issuer of the JUNO KiwiSaver Scheme. You can read our Product Disclosure Statement. This article is general in nature only and has not taken into account any particular person’s objectives or circumstances. We recommend you speak with an independent financial adviser before acting on this information. All content is correct at time of publication date.