Rattled KiwiSaver investors reach out for reassurance

ANZ says some KiwiSaver members have been shaken by market movements but they need to focus on the long term.

The bank, which is the country’s biggest KiwiSaver provider, received the same number of social media interactions in the past week as it did in the whole of May. Call volumes were about 20% higher than normal, it said.

Markets have fallen significantly – the S&P 500 Index, which is often seen as the benchmark for global equity markets, is down more than 20% from its recent all-time high, and the tech-heavy Nasdaq 100 Index is off by more than 30%.

‘‘We understand people may be anxious or have questions,’’ said ANZ managing director for funds management Fiona Mackenzie.

‘‘We are now seeing an increase in members reaching out to us through our contact centre or via social media channels.

‘‘But it is important investors remember that financial markets do go up and down.

‘‘If we step back for a moment and focus on the long-term, which is what investing in KiwiSaver is all about, history tells us that markets recover – some faster than others but they do recover.’’

She said queries were focused on market fluctuation, the value of people’s investments and whether they should switch funds.

‘‘It is hard to predict when markets will change direction and trying to pick the best times to change funds comes with risk.’’

ANZ chief investment officer Paul Huxford acknowledged the market falls were significant but said they needed to be put in perspective.

The S&P 500 and Nasdaq 100 were still higher than they were in February 2020.

The S&P 500 is still up more than 10% from that level and the Nasdaq 100 is more than 15% higher.

‘‘People remember market sell-offs but it is even more important to remember that each bear market has been followed by a recovery and new highs over the long term.’’

The S&P 500 has risen by 1530% since the lows of the 1987 crash; by 360% since the dotcom crash of 2000, and 442% since the global financial crisis.

ANZ said people should keep up their contributions through periods of market declines. ‘‘Investing through a downturn means you can invest at lower prices and benefit from any market recovery,’’ Mackenzie said. ‘‘It helps create good investment habits and sets you up for more financial freedom, whatever your ‘life after 65’ plans are.’’