The value of a KiwiSaver goes up and down relating to stock market and economic conditions and the continuing effects of the coronavirus pandemic across the globe has seen many a fluctuation in KiwiSaver balances, with many balances taking a recent sharp drop before some recovery… so what to do?
If you go with your gut many people would have the natural instinct to “Sell! Sell! Sell!” but in reality, there is very little reason to panic. This short article gives you a quick introduction into why your saving balance may drop and we’ll introduce you to some experts who can help you to make the best choices for your own unique situation and make aa fully informed choice on your KiwiSaver investments.
Why does the balance in my KiwiSaver drop?
There is a simple explanation for this, your KiwiSaver account is very different from a traditional savings account where you only see the balance decrease if you withdraw. KiwiSaver is based on investments. Those investments go up as well as down and so your KiwiSaver balance will change to reflect how much your investment is currently worth on any given day.
The recent years and months have seen the coronavirus pandemic affect pretty much everything in our day to day lives, that includes the businesses your KiwiSaver funds are invested in. This means your investment may well have a lower value right now as many businesses are making less money and worth less than before the pandemic hit. But they should recover, so again, don’t panic.
How should you act when your KiwiSaver balance drops?
As above. Don’t panic! If you are concerned seek some specialist investment advice. Here at MoneyCompare we have partnered with National Capital around all things KiwiSaver. They know the market, know the quirks and the tricks of the trade and can provide expert advice on how and when to act with your KiwiSaver dependent on your unique personal circumstances and what you are looking for your KiwiSaver to do – for example, save for retirement or act as your house deposit.
National Capital will hold your hand on all things KiwiSaver and that means there is no need to stress.
What are your goals?
When your personal or family circumstances change, which they may well of in the recent times, it’s time to consider a change in your investing and KiwiSaver priorities. Your KiwiSaver should be aligned with what is important to you. You don’t need a full-on plan – who has one of them? You just need a ballpark idea of what you are looking to achieve with your KiwiSaver funds. Is it a comfortable sum for retirement? Or a healthy deposit for a first home? That will affect the levels of contributions you make and the type of fund you are in.
Should I stick with the same KiwiSaver fund forever?
Well, that depends on those priorities. The best way to know if you are in the right fund is to talk it through with the experts. Our friends at National Capital are just that. KiwiSaver Experts. Visit their site, take a quick KiwiSaver health check and they’ll be in touch with some advice. Stick with current provider, change fund, start a fund, who knows but they will certainly be able to help and their service is free of charge so why wait? Take a KiwiSaver health check today!
