Capital protected KiwiSaver option launched

Westpac is launching a ‘capital protected’ option for its KiwiSaver to address the security concerns of potential investors.
The launch comes just as criticisms from industry agent provocateur (and KiwiSaver provider) Gareth Morgan that KiwiSaver is not government guaranteed have been widely reported, although Westpac has been planning the product well before those criticisms were made.
The scheme is designed and managed by Westpac-owned BT Funds Management.
“We are aware that there is a large part of the New Zealand population for whom superannuation schemes are an unknown quantity and the capital protection plan was designed by BT with them in mind,” says Westpac’s Head of Wealth Management, Tracey Berry.
Capital protected products have been very successful in the Australian market, she says.
The oft-discussed lack of sophisticated awareness amongst New Zealanders about the financial markets means people will probably opt for the more conservative products, and in general will be risk averse.
“We’ve done a lot of market testing of this with employers’ it’s one of five KiwiSaver products we’ll be offering but we think this will be favoured, especially for those who want to be heavily into equities but who are a bit nervous about it.”