Tips for Maximising Your KiwiSaver Returns

KiwiSaver is a crucial part of retirement planning for many New Zealanders. Making the most of your KiwiSaver account can significantly impact your financial future. In this blog, we’ll share practical tips to help you maximise your KiwiSaver returns and ensure you’re on the right track for a comfortable retirement.

Choosing the right KiwiSaver fund is the first step toward maximising your returns. KiwiSaver funds range from conservative to high growth, each with different levels of risk and potential returns. Conservative funds are less risky but offer lower returns, while growth funds are riskier but have the potential for higher returns. Consider your risk tolerance and how long you plan to stay invested when selecting a fund.

It’s essential to review your KiwiSaver fund at least once a year. Life changes, such as a new job or approaching retirement, may necessitate adjustments to your investment strategy. Reviewing your portfolio ensures it remains aligned with your financial goals and risk tolerance.

Employer contributions can significantly boost your KiwiSaver savings. Ensure you’re contributing at least the minimum amount required to receive the full employer match. For most people, this means contributing at least 3% of their salary but you can contribute as much as 10% from each pay or make additional voluntary contributions to bolster your savings.

The New Zealand government offers an annual KiwiSaver Member Tax Credit, matching 50 cents for every dollar you contribute, up to $521.43 each year. To receive the full amount, make sure you’re contributing at least $1,042.86 annually to your KiwiSaver account.

Increasing your personal contributions can have a substantial impact on your KiwiSaver balance over time. Even a small increase, such as contributing an extra 1-2% of your income, can lead to significant growth due to the power of compounding interest.

Unnecessarily high fees can eat into your KiwiSaver returns. Compare the fees charged by different KiwiSaver providers and consider switching to a provider who is providing value for the fees they are charging. Even a small difference in fees can make a big difference over the long term.

Keeping up with market trends and changes in KiwiSaver regulations can help you make more informed decisions about your investments. Follow financial blogs, read books on investing, and attend seminars to stay educated.

Personalised financial advice will make a big difference. As Diligent Wealth are qualified financial advisor's, we can provide tailored advice based on your individual circumstances, helping you make the most of your KiwiSaver account.

Maximising your KiwiSaver returns involves understanding your fund, maximising contributions, reducing fees, and staying informed. By following these tips, you can take control of your financial future and ensure you’re on the right path to a comfortable retirement.