KiwiSaver year in review

2021 has been an eventful year for investors, including all of us in KiwiSaver. Returns have been positive, but we shouldn’t overlook KiwiSaver’s success as a whole for New Zealand. Investor confidence has hit a five year high and rebounded to the highest level since early 2017, sitting at nett 25% for Q3 2021.

As of 31 August this year, there were 3,138,838 New Zealanders investing in our country’s KiwiSaver programme.¹ That’s an amazing result, with millions of these members actively using KiwiSaver to save for their future. 

From August 2020 to August 2021, they contributed a total of $4.97 billion dollars to their accounts.² But thanks to KiwiSaver, that was only part of what contributed to their overall savings - employers contributed another $2.8 billion, and up to $921 million of Government contributions was claimed by scheme members.³ 

As at the end of September, there’s now over $87 billion across all New Zealand KiwiSaver schemes. That’s an increase of $16 billion, or 22%, over 12 months.⁴ That means investment returns added about $7.3 billion across everyone’s savings.⁵

We’ve seen our fair share of that growth. ASB KiwiSaver Scheme members added about $2 billion to their savings this year, bringing the total to around $14 billion. We’re very proud to be the second largest provider managing New Zealanders’ KiwiSaver savings⁶, growing our members 'one day' savings.

Our ASB KiwiSaver Scheme funds showed strong performances: 

• Our Growth Fund put in a solid performance, increasing the value of its members funds by 17.98% in the 12 months to the end of October 2021.⁷
• The Positive Impact Fund out-performed many other Balanced funds, delivering returns of 16.88% in the 12 months to the end of October 2021, while maintaining its focus on responsible investing.⁸
  
• Our Moderate and Balanced funds continued to deliver returns to customers, producing 4.89% and 11.38% returns over the same period, respectively.⁹
  

But it’s not just about the big numbers. We’ve made some important improvements to the ASB KiwiSaver Scheme this year, and helped our customers set themselves up for even better futures.

As of the start of December, around 500,000 New Zealanders have their KiwiSaver account with ASB. That’s about 16% of all KiwiSaver members in New Zealand.

The average ASB KiwiSaver Scheme account balance is approximately $27,000, up 16% from $23,591 a year ago.¹⁰

As well as contributing, lots of members have used their KiwiSaver savings too.

• From January this year to the near end of November, ASB has drawn down $248 million for a first (or previous homeowner) home withdrawal by members.¹¹
• We’ve seen members using their KiwiSaver savings to enjoy their retirement – since January this year, we have processed over $220 million in full or partial withdrawals.¹² Many of them keep their money in the KiwiSaver account to continue enjoying strong returns and low management fees. (Tip: not sure how to set yourself up for this? Check out more information here)
  
• We’ve also helped members access their savings to help get through a difficult time in their lives, with over $7 million being made available for Hardship Withdrawals.¹³
  

A positive change for us: a new investment partner

In July we brought on board BlackRock* as our new investment partner. They’re the world’s largest investment management firm, with world-class expertise.

BlackRock now manages our ASB KiwiSaver Scheme along with our other managed funds for asset allocation and currency decisions (where and how we invest). We decide what we want each fund to achieve – growth, stability, or something in-between – and BlackRock work with us to design the best ways to achieve those objectives. 

We’ve already made some big changes to our asset allocations following their recommendations. You can read more about them in our recent blog about September’s results.

We removed our admin fee

From 1 October we removed our administration fee.

It was an annual fee of $30, which we’re now very happy to be adding to your savings! Delivering even better value for customers and generally saving our members up to 24% in fees.¹⁴

You can read more about this on our blog: Your KiwiSaver fees are going down.

Five years Platinum!

In the past month, we were notified that the ASB KiwiSaver Scheme had been given a Platinum rating by SuperRatings – the highest possible rating. SuperRatings evaluates KiwiSaver schemes on investment performance, fees, member servicing, admin and governance.

Not only did we receive a Platinum rating – it’s the fifth year in a row that ASB received this Platinum rating.  We’re proud to be able to use the Five-Year Platinum Performance title from SuperRatings.

We’ve helped the future of thousands of people with good advice

At ASB we understand that everyone is different and talking about money can be tricky. One of the easiest options available is to use our team of KiwiSaver specialists. They can chat with you about your current situation for free and provide a recommendation for what fund suits you best, based on your savings goal and timeframe.

We feel getting advice is such a key factor in making the most of your savings, so we ran a campaign earlier this year offering all New Zealanders with a KiwiSaver account, 250 chances to win a $1,000 boost to their KiwiSaver savings. This was open to all KiwiSaver members regardless of who their provider was - this is how important we think getting advice is.

From January to November this year, we’re happy to say we had around 40,000  conversations using our advice tool, helping New Zealanders get to their KiwiSaver saving goal sooner.

We’re keeping our members informed

We want everyone to have a very clear picture of their KiwiSaver savings and their options. After all, our members are the ones who should be in the loop around how we invest and the best ways for them to meet their goals. From April this year, we’ve sent almost two million messages and emails to our members, to keep them completely informed and aware of any changes they could make to better meet their savings goals.

The Te Ara Ahunga Ora Retirement Commission has recently updated its recommendations on how much you need to save for your retirement. Check out their Retirement Calculator on Sorted.org.nz to see how much they think you’ll need. Then you can use our tool to see if you could tweak your ASB KiwiSaver Scheme settings to help reach your target.

Our funds are designed for different goals and timeframes, with different potential investment returns and risks, that’s why choosing the right fund is also an important part of achieving your savings goals.

If you’re an ASB KiwiSaver Scheme member, thanks for being part of such a great year. We hope next year offers similar performance when it comes to returns for our investors – and, with any luck, much better when it comes to pandemics. Thanks for your support, and we look forward to continuing helping you reach your goals.

We’re always here if you need! Give us a call on 0800 ASB RETIRE (0800 272 738) or email us retire@asb.co.nz.

Interests in ASB KiwiSaver Scheme (Scheme) are issued by ASB Group Investments Limited, a wholly owned subsidiary of ASB Bank Limited (ASB). ASB provides Scheme administration and distribution services. No person guarantees interests in the Scheme. Interests in the Scheme are not deposits or other liabilities of ASB. They are subject to investment risk, including possible loss of income and principal invested. For more information see the ASB KiwiSaver Scheme Product Disclosure Statement available from asb.co.nz] and the register of offers of financial products at www.business.govt.nz/disclose (search for ASB KiwiSaver Scheme).

Fees may change. For more information about fees, refer to the ASB KiwiSaver Scheme Product Disclosure Statement and the register of offers of financial products at www.business.govt.nz/disclose.

Returns are a reflection of past performance and are not a guarantee or indication of future performance because returns fluctuate (move up and down). Returns can be negative and you may receive back less than the total amount of your contributions.

*BlackRock Investment Management (Australia) Limited (BlackRock) is a wholly-owned subsidiary of BlackRock, Inc. BlackRock, Inc is based in the US and is a leading global provider of investment management services with over US$9.5 trillion in assets under management as at 30 September 2021.

The ratings issued by SuperRatings Pty Ltd ABN 95 100 192 283 AFSL 311880 (SuperRatings) for ASB KiwiSaver Scheme (‘Platinum’ rating), are as of 23 November 2021. SuperRatings does not guarantee the data or content contained herein to be accurate, complete or up-to-date, and it will not have any liability for its use or distribution. Ratings are not financial advice for the purposes of the Financial Markets Conduct Act 2013. Consider your personal circumstances, read the product disclosure statement and seek independent financial advice before investing. SuperRatings uses objective criteria and receives a fee for publishing awards. Visit superratings.com.au for ratings information and to access the full report. © 2021 SuperRatings. All rights reserved.

References

^{1, 2 & 3} Source: IRD Monthly KiwiSaver Data for August 2021. https://www.ird.govt.nz/-/media/project/ir/home/documents/about-us/tax-statistics---current/kiwisaver-statistics/monthly-kiwisaver-data/monthly-kiwisaver-data.xls

⁴ Source: Morningstar KiwiSaver Survey September Quarter 2021; September quarter 2020 (cited by ASB, not seen by this writer).

⁵ From the IRD figures, monthly contributions are usually around $625m

⁶ Source: Morningstar, as above

^{7, 8 & 9} Zenith Monthly Performance Tables, October 2021, performance data is calculated after fees and before tax

^{10, 11, 12 & 13} Source: ASB Data

¹⁴ Fee Source: Calculation based on an ASB KiwiSaver Scheme Cash Fund with a balance of $27,000