KiwiSaver happy returns? Not if you’re with Gareth Morgan

KiwiSaver turned 5 years old yesterday – so says Andrew Gawith, one of the lead managers of Gareth Morgan KiwiSaver (recently bought out by Kiwibank because Gareth dislikes running a big business, and prefers fattening orcas up with tasty penguin treats)

“Many Happy Returns” says Gawith.

Presumably he doesn’t mean the returns of Gareth Morgan Kiwisaver that are happy. Nor does he suggest that those who entrusted their funds with GMI are happy about their returns either.

That’s because those returns were so shocking in the Morningstar calculations, that Morgan jumped up and down and removed his fund from the Morningstar analysis, conveniently preventing future investors from assessing GMI on a like-for-like basis with other funds.

So if you like your KIwiSaver funds building up, then bully for you and I hope you have a happy retirement. And if you are scratching your head over your unhappy returns, pick up the phone and have it out with your KiwiSaver provider.


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  • Arkhad

    I am self employed and pay the amount at which the govt matches dollar for dollar. So I am not unhappy with my return per se. But Gareth Morgan has failed over all the years I have had it with him to add even one cent of value. In fact he has just eaten away at it in fees. When Stephen Joyce was looking for new ideas I was tempted to write to him. My suggestion was to be that since there must be 00’s and 000’s of people like me getting a rum deal from these providers and since we can’t touch the $ anyway how about just letting it mount in govt coffers and save so much govt borrowing. Of course with some proper legislation to prevent any future govt from plundering it.

    • ConwayCaptain

      That is what has happened in Japan.  The J Govt has a debt approaching 200% of GDP BUT it is all held in Yen and they give a ridiculously low interest rate.  That is why there has been the carry trade with J families investing in NZ mortgages through your friendly bank.

      They get 2% or so from the ASB or whomsoever who lends it to us at 6% and of course there is forward foreign exchange cover so when they come to pay the money back they dont lose out.

  • Pokerface

    Thanks for that post, Cam. I’m with Mercer, and you’ve just made my day!!  :-)

  • John Q Public

    I kinda find it amusing this constant bagging of KS, just read the comments section in any Mary Holm column. I’ve contributed less than 30% of what mine is worth. Happily for GM KS punters and some others probably, the perfect DCA outcome is a V, so they’ve started well so far.

  • indifferent

    Am hoping for better returns under kiwibank- but am getting a bank rate of return out of GMK

    • Auto_immune

      I have my KiwiSaver with Kiwibank currently (which is managed in part by AMP).  I’m a bit worried that the GMK wing will take over management and my returns will disappear.

  • AnonWgtn

    We lost a six figure retirement sum (actual) some years ago to a “highly rated” managed fund with AMP. They took their management fee each year of course, off what was left depreciating.
    Our family have been told that if they invest with a managed fund they will lose out of our inheritence. They clearly understand managed funds now where only the fund manager wins. This does not include Kiwi Saver which is actually a con though, so not to lose the original Government input.

  • one-off

    Does anybody else find it ironic that Gawith (Andrew) is how Gareth (Morgan) would pronounce ‘Gareth’???

  • Bawaugh

    Garath Morgan would have to loss about 60% of the money in his Kiwisaver fund before any of his members  lose any money.

    Because 100% match from employer, plus a 50% match from Government on anyones contributions means a normal member is getting a very good free lunch. (Yes I know it depresses wages, and I know that this example does not apply to the self employed, total salary employees and those who put more money that the Government tax credit allows.)

    I put my Kiwisaver into a low fee fund which follows an index (so no expensive brains required and thus better returns for me).

    Anyway do not have it out with your Kiwisaver provider – Just FIRE them, chaning provider is not rocket science all it requires is your IRD number.

  • buffetts my boy

    It shows what happens when you have an economist actually investing for you – all he ever had to do in a former life was theorise – the market might do this, but if this hapopens it might do this. When you manage money you have to actually make decisions which is where he has come unstuck