KiwiSavers shouldn't leap into investment decision - NZX

29 June 2007 - KiwiSaver investors have until 1 October to decide where they want their KiwiSaver investments to be made. But according to NZX there is still some misunderstanding around the timing for KiwiSaver fund selection.

"People are feeling pushed into making a decision before the end of this month," said NZX Head of Products Geoff Brown.

"However, whilst employees wishing to opt in to KiwiSaver should do so from 1 July, they have three months to make a decision on their KiwiSaver fund provider. During this time their investment will sit with the IRD, so they should not feel pushed into making that decision until they've taken time to do their own research and decide what's best for them."

Brown said that prospective KiwiSavers may be suffering from "information overload".

"There's a whole lot of hype and a lot of aggressive advertising by KiwiSaver fund providers telling people to choose them. But KiwiSavers owe it to themselves to take a deep breath, decide what's important to them at their working life stage, and choose an option that's going to deliver them what they need to have the life they want in retirement," said Brown.

"In particular they should take a hard look at the fees and scheme costs being charged by providers. Where these aren't specified clearly enough, they should ask for more detail, especially around unquantified costs and expenses. In our view, KiwiSaver funds should be easy to understand, low cost and completely transparent, so KiwiSavers know how much of their fund is being diluted by fees.

"We believe KiwiSavers need to take some time to make an informed choice and we encourage them to compare all the schemes on offer. They have the time to do so," said Brown.

For more information, please contact:

Lucy McFadden
Communications
New Zealand Exchange Limited
04-496-2890
0275-127-832