Investment and 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 Financial Markets Authority reported that as at 31 March 2021, total KiwiSaver funds under management stood at $81.6 billion, up 31.7% from $62 billion a year earlier. Although membership is nearing saturation, we know from our research that over 17% of Kiwis aren't currently contributing, with over 30% contributing the minimum of 3%, so the focus should continue to be on encouraging New Zealanders to engage with their KiwiSaver, particularly in light of the changes to default KiwiSaver providers in December 2021.
The funds management industry is forecast to maintain revenue growth over the next five years, and we have witnessed an extraordinary uptake of emerging technology and new investing platforms that are seeing younger investors enter the market.
However, as with all industries there are challenges ahead. The emergence of robot advice is anticipated to curb industry growth as competition intensifies in the financial planning segment. With new investment options out there, safety and security of customer information and finances is also paramount.