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Even a small rise in annual KiwiSaver fees will see them top $1 billion next year

Personal Finance / news
Even a small rise in annual KiwiSaver fees will see them top $1 billion next year
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Annual KiwiSaver fees look set to top $1 billion next year, based on Financial Markets Authority (FMA) data.

The FMA's annual KiwiSaver report for the year to March 31, 2026, out Thursday, showed $978.2 million in fees was deducted from KiwiSaver schemes, a 12.6% increase year-on-year.

Last year's FMA report showed fees of $868.5 million, which was a 10% increase. And the FMA's 2024 report showed $789.6 million in fees after an 18.9% increase.

To reach or breach $1 billion for the March 2027 year, KiwiSaver fees need to rise by a minimum of $21.8 million, or just 2.2%.

Fees cited by the FMA  include investment management fees, administration fees, supervisor and trustee fees, and other scheme expenses. In this year's report it says there were administration fees of $21.34 million, investment management fees of $926.9 million, supervisor fees and (in the case of a restricted scheme) trustee fees of $7.2 million, and other scheme expenses of $22.7 million.

The FMA says the March 2026 year fee increase was in line with the growth in total funds under management, which rose 12.8%. 

"The [FMA] chart below shows a decline in fees as a proportion of funds under management until the last three years where fees have remained relatively stable at around 0.7% of funds under management. Total KiwiSaver funds under management for the same period have increased from $93.7 billion to $138.8 billion," the FMA says.

"In the current financial year, the FMA will undertake research to understand recent trends in KiwiSaver provider fees."

 

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2 Comments

"The FMA says the March 2026 year fee increase was in line with the growth in total funds under management,... "

An utter consumer ripoff, legislated by the Government & endorsed by the Regulator.

Once the initial account has been setup the marginal cost of managing additional funds is zero. All these schemes (& the offshore investment funds they reallocate to) just clip the % ticket. AFAIK none of the local KS providers has ever attempted to justify their fees relative to any actual costs of servicing the accounts.

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One year out from retirement I shifted my KS ($144K) to Fisher's Conservative fund. A month later it had dropped in value to $141K. How do you lose 3 thousand dollars in one month from bonds, cash in the bank etc.

I asked why the sudden fall but no explanation was forthcoming. They still took their fees though.

That outfit has really gone downhill since Carmel left

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