Big KiwiSaver providers go for digital tools for advice

Big KiwiSaver managers continue to ramp up use of digital tools to steer jittery investors and beleaguered KiwiSaver members onto the right investment path.

New Zealand’s second largest KiwiSaver provider ASB is launching a new KiwiSaver advice tool on its mobile app and online banking platforms and Kiwi Wealth has incorporated the messaging system into its online portal.

ASB Head of KiwiSaver Distribution, Hamish Davidson, sees ASB has seen a lot more correspondence in the past 12 months around market volatility.

“With Covid, KiwiSaver customers right across New Zealand tended to overreact and change their funds which may or may not have been the right thing to do. So we’ve tried to engage with a lot more people over the phone. This time not as many have moved to more conservative funds as they did when Covid broke out.”

Davidson says partnering with BlackRock has provided more access to information which the bank has shared with customers.

“We know for a fact there are still a lot of people in New Zealand who don't necessarily understand KiwiSaver or don't use it as effectively as they possibly could.”

ASB research in the third quarter shows Kiwi are not confident in their retirement plans with 64% believing they need to be saving more for retirement and around a quarter (27%) having a clear idea how much money they’ll need. Of the almost 1000 New Zealanders surveyed, only 23% say they have a good overall understanding of KiwiSaver.

The digital tool will allow customers to do a bit of a sanity check themselves and self-service with personalised information on the right KiwiSaver fund and contribution level. They will also be able to make changes but if they still need to talk to someone they will call and talk to a specialist.”

Meanwhile Kiwi Wealth says it is already seeing customer behaviour change through use of its new messaging platform.

Chief executive, Rhiannon McKinnon, says during periods of market volatility, making short-term decisions can cost investors significant returns over the long run.

“Our commitment to reach customers on their terms and with the right support helps them make good decisions to grow and protect their long-term wealth.”

Kiwi Wealth has sent 1.4 million targeted, personalised messages with information. McKinnon says of the viewed messages, 25% have led to direct action, such as using digital advice tools to review their fund choices and risk appetite.

A recent test showed a 22% increase in customers using digital advice to help them select the right fund.

Kiwi Wealth joins ANZ, BNZ, Kiwibank and Southern Cross Health as users of the Atomic messaging platform. Digital advice tools are also available from BetterSaver, kōura Wealth, Nikko Asset Management and Milford Asset Management.