Advice key part of KiwiSaver success: ANZ
Advice is important to make sure New Zealanders get the most out of KiwiSaver, the country’s biggest provider says – but it suggests much of it should be supplied free.
Tuesday, September 5th 2017, 6:00AM 
7 Comments
ANZ has released a survey and whitepaper to mark the 10th anniversary of the retirement savings scheme.
It called for the scheme to be made compulsory, for providers to be required to offer free savings advice to members and help for those in the decumulation phase.
It said the need for advice was apparent in the results of a survey of 1000 people, which showed most had not even worked out how much they were likely to have saved by 65. More than 20% said that was because it was too difficult to do so.
The survey found 28% of respondents said it was best for KiwiSaver funds to be made available as a lump sum at 65. Another 19% thought it was best in installments. More than 40% said a combination would be best.
Almost 30% said they wanted their KiwiSaver provider to give them a set of regular withdrawal options to choose from at retirement, but 62% wanted access to free professional advice.
ANZ said roboadvice would play a bigger part in future advice for KiwiSaver members.
A third of respondents would prefer to get retirement savings advice from a person and 31% said they would use a sophisticated online calculator, either alone or with someone helping them. Just under 20% said they would prefer just online tools and 16% wanted a DIY approach.
Members with little knowledge about KiwiSaver were more likely to want advice from a person, at 47%.
ANZ said the government should also provide some guidance around assumptions and parameters regarding roboadvice to make sure there was consistency in the provision of mass-scale advice.
“At ANZ, we offer free financial advice to ensure members can continue to benefit from exposure to markets, with the right risk profile for their retirement circumstances,” ANZ said.
“We also promote use of the regular withdrawal option to discourage people from impulse buys or reallocating their money to misguided investments. While this is a good first step, there’s still plenty more the government and financial services industry can do to help educate New Zealand’s ageing population on how best to decumulate to achieve a comfortable retirement lifestyle.”
ANZ recommended that KiwiSaver providers be required to check in with members a year after they withdrew money for a first home and encourage them to seek advice.
It said providers should also encourage female members to get personalised advice.
"The government and financial services industry should work together to enhance the financial capability of New Zealanders receiving NZ Super. This could be in the form of a comprehensive information pack that accompanies SuperGold cards, with directories on where to access financial advice, and a range of investment and decumulation options available to them."
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Comments from our readers
It amazes me how the banks in particular are able to spin reality, where the reality makes them look bad, in such a way that they look like saints. Probably a PhD thesis here for someone doing a BCom, majoring in fake news.
Yeah? And how's that working out for them so far? They haven't had advice, don't know how much they need to save, don't know how much they are going to save, don't know how KS actually works, don't know how or what to decumulate, don't know how to pick a fund or a provider and don't know how to find Good Advice.
So of course ANZ are working on a Robo "advice" platform - they already have one - an army of not-on-commission polo shirted NR's programmed and KPI'd to dispense "advice".
It's up to advisers individually and as a collective such as FANZ to educate the public that SOMEBODY is paying their "free (lol)" adviser. If it's not the client themself, then the client is not the master and they have probably not received Advice, they have received "advice".
That is not to say that financial institutions will decimate the financial dispensing industry through technology – far from it. They will however increasingly target consumers direct (as will all manufacturing entities who employ in-house distribution) by offering a low cost, reasonable quality gateways into their capabilities…. “any colour you like as long as it’s ours”. This should appeal more to the masses, as more affluent consumers will prefer to pay for bespoke advice.
…the trick for advisors is to stay away from providing homogenous low value services that are / can easily be replicated on mass…
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