Everyone with a KiwiSaver account pays a fee for membership. This usually comes in one of two forms. You can pay:
- A fixed membership fee, which is a flat fee ranging from $0 to $60 a year (according to Sorted’s fund finder tool).
- You could pay a percentage of your account balance.
What does the membership fee cover?
Your KiwiSaver provider charges a membership fee for its management, administration and investment costs. Details of the fees that your KiwiSaver scheme charges are disclosed in your KiwiSaver scheme’s Product Disclosure Statement, available from your provider.
What is better?
In short, it depends on your balance and provider! If you’re paying a fixed fee of, say, $60 on a small balance with a low return, it can eat away at your investment. But if you have a large amount in your account and are gaining large returns, that $60 fee may have little effect.
On the other hand, you could be paying a percentage of your balance, instead of a fixed fee. Ultimately the higher the balance the higher the fee, and the lower the balance the lower the fee. Again, it depends on your balance and your chosen provider.
The fees vary from provider to provider, and you can also have a look for yourself with Sorted’s handy fees calculator tool.
What else do I need to know about fees?
- Fees don’t always represent the level of service you receive from a KiwiSaver provider.
- Your fees could change with your provider over time (meaning they could go up or down).
If you have any questions about your KiwiSaver account, reach out and ask your provider or Adviser. It’s never too early to get a grip on preparing adequately for your retirement.
AdviceFirst Limited | A Disclosure Statement is available on request and free of charge.