Many think KiwiSaver fees are too high

Many think KiwiSaver fees are too high

 

A third of KiwiSaver members think their fees are too high, a survey run by the Financial Markets Authority found.

And around a third of those said they’re considering changing their scheme or provider.

But half of the people in the survey didn’t even notice that the fees in their member statements are now shown in dollar amounts.

Of those who did, 86 per cent rated the information as “quite” or “very” useful.

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However, members still said their current balance was the most useful information on the statement.

This year, for the first time, providers have had to display the fees a member paid in dollar amounts in the annual member statement.

Among the 31 per cent of people who noticed the fees were in dollar amounts:

·         53 per cent said they thought the fees were about right.

·         30 per cent thought they were too high.

·         4 per cent thought they were too low.

The survey found the main way KiwiSaver members are assessing value for money is by checking their balance and comparing it with other schemes.

However, almost four in 10 KiwiSaver members were not using any information or tools to assess value for money.

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Of those polled, 78 per cent read their statements and 20 per cent of them read it thoroughly.

The percentage of members who said they didn’t intend to read their statement also fell, compared to the results of a Colmar Brunton survey in 2016.

More members said they’re checking their KiwiSaver is on track to produce the income they’re planning for in retirement.

Liam Mason, the FMA’s director of regulation says in a press release: “Readership of the statements remains high, and for many there was real value in understanding how much they’re paying in fees.

“The information also prompted people to use comparison tools and consider shopping around for better value.

“While this is all positive, the number of people who didn’t see the fees information shows there is further work to do to encourage people to look at their statement thoroughly. I’d encourage everyone to check their statement to review their KiwiSaver.”

First published 16 August, 2018

JUNO does not contain financial advice as defined by the Financial Advisers Act 2008. Consult a suitably qualified financial adviser before making investment decisions. This story reflects the views of the contributor only. Content comes from sources that JUNO considers accurate, but we do not guarantee that the content is accurate.


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