5 KiwiSaver mistakes to avoid

The world of KiwiSaver might seem daunting and complex. We’ve come up with some common KiwiSaver mistakes you should try to avoid.

1. You’re not enrolled in KiwiSaver

If you’re signed up to KiwiSaver and contributing regularly, well done! This is a huge step to help boost your financial future, and options in retirement.

If you’re not enrolled in KiwiSaver yet, there’s still time to do it. You could be missing out on money to help you when you retire.

KiwiSaver isn’t for everyone, for example those who are seriously ill or suffering major financial hardship, but for most Kiwis, it’s a great way to help save for retirement.

You can also use your KiwiSaver money for the deposit for your first home.

2. You’re not contributing

You might be enrolled in KiwiSaver, but are you actively contributing? KiwiSaver only works when you put money into it. At the very least, we encourage you to contribute enough to qualify for the free government money every year. To get the full $NZ521, just contribute NZ$1,042.86 per year – about NZ$20 each week.

Even if you can’t contribute the full NZ$1,042.86, for every dollar you contribute up to that amount, the government matches it with 50 cents. Also, if you’re not contributing, you’ll miss out on the 3 per cent your employer will put into your account.

3. You’re not in the right fund for you

When you enrol in KiwiSaver, you’ll select what type of fund you want your money invested into. There are usually a few to choose from.

All funds come with different levels of risk. The fund you’re in depends on a few factors, like how soon you’ll be taking your money out, and your attitude towards investing.

If you’re not sure which is the right fund for you, talk to your KiwiSaver provider or a financial adviser.

4. You’re paying too much tax

If you’re in KiwiSaver, it’s really important you’re on the right tax rate. If you’re paying too much, or too little, tax – this isn’t good. There are three main tax rates you could be paying. Check which rate you should be on at Inland Revenue. This can be a bit confusing, so don’t be afraid to ask for help from your KiwiSaver provider if you’re unsure.

5. You’re thinking short term

Because your KiwiSaver money is invested, it means the balance can go up and down, because it’s often invested in shares – on the share market.

If you’re in an aggressive or growth fund, your balance might have quite large rises and falls.

The important thing is not to panic. Don’t react abruptly and look at moving into a lower-risk fund, just because your balance falls. If you do, you risk locking in the losses you might have experienced.

Remember, KiwiSaver is a long-term investment. Over the long-term, for example 30-plus years, your money will rise and fall with the markets, but overall, you’ll likely get positive returns.

If you’re worried about dips in your investment, you could be in the wrong fund. Talk to your provider and make sure you’re in the right fund for you.


Information correct as at March 2022. Pie Funds Management Limited is the issuer and manager of the JUNO KiwiSaver Scheme. Click here for our Product Disclosure Statement. Any advice is given by Pie Funds Management Limited, and is general only. It relates only to the specific financial products mentioned and does not account for personal circumstances or financial goals. Please see a financial adviser for tailored advice. You may have to pay product or other fees if you act on any advice. As manager of the Scheme we receive monthly fees that are determined by your balance and whether you are 13 years or over. We will benefit financially if you invest in our products. We manage any conflicts of interest via an internal compliance framework designed to ensure we meet our duties to you. For information about the advice we can provide, our duties and complaint process and how disputes can be resolved, visit www.junofunds.co.nz. All content is correct at time of publication date, unless otherwise indicated. Past performance is not a guarantee of future returns. Returns can be negative as well as positive and returns over different periods may vary. Please let us know if you would like a hard copy of this disclosure information.