ISI Welcomes ANZ’s Contribution to the Debate on Kiwisaver

19 January 2012

ISI Welcomes ANZ’s Contribution to the Debate on the Future of KiwiSaver

ISI Chief Executive, Peter Neilson, has welcomed the ANZ Wealth and OnePath proposals to change the default investment fund option for KiwiSavers to better match their long term interests.

Defaulting into conservative funds has done a good job in preserving capital in the most difficult investment environment in 100 years but it is not the best place to be long term.

Younger KiwiSaver investors, as the ANZ report shows, will leave considerable “money on the table” if they don’t have a more growth orientated investment strategy long term reverting back to a more conservative stance closer to retirement.

As our population ages and we live a lot longer after reaching 65 we are going to need a bigger KiwiSaver retirement pot come 65.

ANZ quite rightly points out that younger KiwiSavers saving for a home deposit may want a more conservative investment style until they have achieved home ownership. Having achieved that a more growth orientated investment style makes sense.

The ISI supports having a cross-party discussion on the future of KiwiSaver to provide New Zealanders with greater retirement income security.

ANZ has provided useful input into that debate and is to be commended for raising again the issue of how to ensure default KiwiSaver investors are in the best long term investments for their retirement income security.

Growth funds are more volatile but if the KiwiSaver funds are locked in until 65 a more aggressive investment style makes sense for people many years from retirement.

For further information visit our website: www.isi.org.nz

ENDS

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