Expert warns against chasing top-performing funds as KiwiSaver switching increases - The Prosperity Project
KiwiSaver members are being warned against chasing the best-performing fund or provider as growing numbers shift their retirement savings elsewhere.
Inland Revenue (IRD) data shows 21,757 KiwiSaver members transferred to another provider in June 2026, up from 13,866 in June 2025. While that remains a small proportion of KiwiSaver’s more than three million members, it represents a significant year-on-year jump.
Russell Hutchinson, founder of KiwiMonster – which provides KiwiSaver research to financial advisers – said greater engagement with KiwiSaver was positive, but cautioned against assuming the provider at the top of the performance tables would remain there.
Speaking on The Prosperity Project podcast, Hutchinson says, “Just picking last year’s winner ... probably isn’t a good idea.”
He also warns against picking last year’s loser and betting on a bounce back.
But that doesn’t mean performance isn’t important. “Performance really does matter. After all, this is money, right? The balance when you retire or when you start to draw down on it, that’s what you’re really after.”
Fees are also an important factor to consider, but “a high fee is not intrinsically a bad problem. It is performance after fee that counts”.
Hutchinson says the starting point should be choosing an appropriate broad fund type, taking into account how long you have until retirement, and how much volatility you can tolerate.
While it’s possible to opt for specific types of funds within the broader category settings, he cautions against making your investments too concentrated in one sector, industry or region.
“What you really should be aiming for is a broadly diversified fund, with some international diversification because economies go up and down like individual stocks do.”
KiwiSavers can also choose funds that best reflect their personal values, but Hutchinson says narrowing the investments available can involve trade-offs. “Make sure that the fund reflects your values, but stop yourself before you’re micromanaging.”
Hutchinson suggested investors check progress towards retirement goals annually and avoid reacting to short-term performance.
Watch or listen to the full episode of The Prosperity Project for more.
The Prosperity Project is hosted by Nadine Higgins, an experienced broadcaster and financial adviser.
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