Amanda Morrall warns of the waste if you don't followup with contributions, and the benefits if you do

On Friday, Amanda Morrall explained to Nadine Chalmers-Ross on TVOne why it is a bad idea to sign your children up to KiwiSaver and then make no contributions to that fund.

The 'incentive' to do the sign-up is the $1,000 kickstart that taxpayers contribute.

But without contributions, fund fees will eat away at the balance, with fund earnings unable to compensate sufficiently in most cases.

$20 per week may be all that is necessary to see the fund grow and the fee burden recede to be an acceptable and minor issue.

The core purpose for signing up children is to get them into a long-term savings habit and build a meaningful retirement nestegg.

Or, to build a fund to enable them to afford a deposit for their first house.

But signing up without regular contributions effectively converts valuable taxpayers funds into fee income for the funds industry ! - something no one intends.

This calculator allows you to work through a KiwiSaver plan,

while this calculator shows you how much you get to keep after your Fund' s earnings.

If you have MSExcel loaded to your computer, you will find this calculator useful. Click on it to download the worksheet, or go here:

It allows you to work out approximately how long your child's fund will last if make no contributions ! More helpfully, it will show you how much you need to contribute to meet the goals you have for them when you set the fund up.

A small regular amount per week makes a huge difference.