Investment & Funds

Continued investment by New Zealanders is not only vital to ensure New Zealanders save enough during their working lives to provide quality of life in their retirement, but also the growth of the economy and potential creation of new major global businesses from a New Zealand base through the resultant investment in business.

Part of this rapid growth is through KiwiSaver. The New Zealand Treasury is forecasting that KiwiSaver funds under management will reach NZ$70 billion by 2020, a compound growth rate of 20%. Although membership is nearing saturation, only 58% of KiwiSavers are regularly contributing to the scheme, so the focus should turn to encouraging those that have stopped contributing to become active again.

The funds management industry is forecast to maintain revenue growth over the next five years. However, as with all industries there are challenges ahead. For example changes to the Financial Advisers Act and the emergence of robot advice are anticipated to curb industry growth, as competition intensifies in the financial planning segment.