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Freaking out about your KiwiSaver? Let’s put it in perspective

Spike

You probably don’t normally give your KiwiSaver much thought, but now that you might have seen it drop during this unstable time, you’re freaking out a bit. Here are some tips to help you put it all in perspective.

KiwiSaver is an investment
Did you think KiwiSaver was a big savings account? You’re not alone. It’s actually an investment – yeah, like stocks and shares but usually not that risky. This means that you will see the cash in your KiwiSaver go up and down over time – this is perfectly normal so don’t freak out.

It’s all a long game
KiwiSaver is designed to be used when you want to down tools and retire. Like, we said, you’ll probably see the balance go up and down many times before then, but where it goes down, it’ll usually go back up again. And if you’re not touching it until retirement, that gives plenty of time for it to build back up.

Remember your goals
Depending on what your goal is (buy your first home, have heaps for retirement, etc.), you would have (hopefully) set up your KiwiSaver with that in mind. If you chose to be in a particular type of fund before all this COVID-19 craziness went down, it will probably still be the right decision when things return to normal, so don’t go changing everything because you’re worried.

Don’t lock in your losses
If you do switch your fund to a more conservative one because you’re stressing, you’ll likely just be locking in your losses. When the market does sort itself out, you’ll still be in that fund and won’t be able to make it all up again as easily. You could switch back, but it’s really not a good idea (plus who has time?) to be changing it with every market change.

Get some help
If you are really worried about your KiwiSaver balance and it’s stressing you out way too much, you can always ask for help. Chat to an adviser about the markets and what’s happening and see what your options are.