KiwiSaver has been a real success for helping our first home buyers into that first home. However, sometimes we have to remind ourselves that what has accumulated in that valuable first home deposit fund, has in many ways been affected by the investment option chosen when we started our savings.
For many of us our application to join KiwiSaver may have just been an application thrust at us by our employer, and on completion we were enrolled in what is called the default fund. For others we may have been advised that given the number of years ahead of us to save, we should have an investment option that carries a higher investment risk - but over the long term the prospect of a greater return than what we might have achieved in the default fund, which is a low investment risk option.
However, all said and done now that we have achieved our goal of home ownership, we need to consider the other reason that KiwiSaver will be good for us – saving for the longer term - or in other words retirement.
Whilst there is a good chance that the investment option that got us our first home deposit, may not get us to where we want to go later – the key message is that after using our savings for our home, we need to complete a financial review and make any adjustments necessary to our longer term goals!
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