New research from Consumer NZ shows KiwiSaver member satisfaction has climbed sharply over the past 2 years, but cost-of-living pressure is eating into retirement nest eggs.
Overall satisfaction with KiwiSaver providers has lifted to 62% (up 10 percentage points in 2 years), with five providers performing better than average.
However, cost-of-living pressures continue to bite. In the past year, 16% of KiwiSaver members took either a savings suspension or a hardship withdrawal, most commonly among people aged 18–39 and households earning under $50,000 a year.
Consumer NZ chief executive Jon Duffy says it’s a troubling trend: “When young people have to dip into their KiwiSaver just to get by, they’re borrowing from their future selves. Every dollar lost today is a dollar that can’t compound for their retirement.”
Duffy says the research highlights another risk – people staying in default KiwiSaver settings without checking whether their funds suit their goals and values.
He says KiwiSaver should not be something you set and forget: “Only 31% of people chose their scheme independently, with most using the default. That’s a big red flag, especially when fees, risk level and long-term returns can add up to a substantial difference over a member’s working life.”
Consumer NZ is urging KiwiSaver members to take 10 minutes to check who their provider is, what fund they’re in, what they’re paying in fees, and whether their settings still match their circumstances.
Duffy says the perception that switching KiwiSaver providers is hard is unfounded: “Switching is an easy and straightforward process, and I encourage all KiwiSaver members to shop around.
“Don’t sleepwalk into retirement. You could be paying too much in fees or missing out on better returns. The more people switch, the healthier the competition – and that’s better for consumers.”
