6 common KiwiSaver myths

1. KiwiSaver is just for older people

Wrong! KiwiSaver is for everyone (well, nearly everyone). If you’re seriously ill or suffering financial hardship, putting money into KiwiSaver might not be the right option for you. 

But even if you’re not even close to retirement age, starting your contributions early can make a big difference later on. You can use your KiwiSaver money to help with your first home deposit, or keep it accumulating to help fund your retirement. The more money you put in now, the better your chance of having more later in life. 

2. It’s a savings account

Partly correct. KiwiSaver is a type of savings scheme. But it’s also an investment. 

This means that you could make money, also known as returns, off the money you have in your account. KiwiSaver is a bit different to a regular savings account, in that you can’t take out the money when you want. 

The only way you can withdraw your money is for a first-home deposit, or when you turn 65 for your retirement. You also might be able to take your money out if you’re seriously ill or suffering financial hardship, but it’s hard to do.

3. If you die, the government will get it all.

Quite a few people think that when you die, the government, or maybe your employer, gets your money. This isn’t true. When you die, your KiwiSaver money becomes part of your estate, along with any other assets you might have. 

The best way to ensure your KiwiSaver money goes to who you want it to when you die, is to include it in your will.

4. Your KiwiSaver account is only made up of your contributions.

Wrong! If you’re contributing regularly, your employer will contribute 3 per cent too. Some employers put in more – good on them! If you contribute enough, you’ll also qualify for the government contribution of NZ$521 a year. 


5. You could lose it all if the market crashes, or if your KiwiSaver provider goes bust.

Because your KiwiSaver money is an investment, it’s not entirely risk-free. And your KiwiSaver money isn’t guaranteed by the government. 

But because your money is in different types of investments, it makes it extremely unlikely you’ll lose it all. It would be very unlikely for all your different investments to be performing terribly at the same time, and for this to be permanent. 

If your KiwiSaver provider goes out of business, you won’t lose your money. This is because your KiwiSaver money is in a trust, and it’s regulated by the Financial Markets Authority. Your money would be moved to a different provider.


6. You should stay in a conservative fund, because it’s a ‘safe’ option

When you sign up to KiwiSaver, you’ll be placed in a default fund. This is usually a conservative fund, which often comes with lower risk. 

But default funds aren’t suitable for everyone. If you’re not planning to use your KiwiSaver money for a long time, or perhaps you’re a confident investor, you might be more suited to a growth fund. Growth funds come with more risk, but if you’re comfortable with risk, they usually give higher returns than a conservative fund. 

Staying in a ‘safer’ fund might mean you’re missing out on significant returns. If you’re feeling unsure what fund is best for you, talk to your KiwiSaver provider or a financial adviser. 


Information correct as at February 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.