You have identified a problem that has worried both financial advisers and their governing body FMA for some time.
When the Government regulated financial advisers in 2008, they created two classes of advisers - Authorised Financial Advisers or AFAs, who are qualified to give personalised advice on investments (delving into your unique situation and working out what is the best investment strategy for you), and Registered Financial Advisers or RFAs, who are limited to giving what is called 'class advice' on investments (basic information). This may have been well intentioned, but caused a lot of confusion both within the industry and from consumers.
As the number of KiwiSaver members grew, some providers became more aggressive in their marketing and sales staff encouraged members to change providers (often without them realising what they were signing up to).
In October 2012 the FMA issued a 'Guidance Note on the Sale and Distribution of KiwiSaver' which warned that "The provision of factual information may constitute a recommendation and/or opinion and amount to financial advice, depending on the context."
What happened next? When customers contacted their provider to ask about their fund, how it was performing, and if they were in the right fund, they got stonewalled.
"Sorry, we are not qualified to answer those questions", or "You will need to find an authorised financial adviser who may be able to help you."
So for the past few years, investors have had to figure it out for themselves, or let their fund plod along - good, bad or indifferent - without any review.
This has led to many investors switching funds without advice, or staying in a low performing fund without realising that they can do better.
Time for more change! The FMA has realised that the current situation is unnecessarily complex, and people like you are not getting the help they need.
The FAA Act is now under review, and soon we will say goodbye to the confusing AFA and RFA designations.
The KiwiSaver advice process is also getting overhauled. Last week the FMA announced that "Our 2012 approach resulted in some people not getting the help they needed, as firms saw it as risky to provide advice."
On November 7 they called for submissions on new guidelines to clarify the difference between class advice and personalised advice, and to identify situations where information rather than advice is provided.
This revised guidance is intended to encourage advisers and financial firms "to help people make good decisions about KiwiSaver".
The new guidelines should help people like you get the help they need from their providers. Obviously, sending you a PDF document was not helpful to you.
If you were able to find an answer to your questions by reading up on KiwiSaver, you would have done so. KiwiSaver is a 'mystery box' to many people.
Until new guidelines are put in place, your best option is to talk to an AFA who specialises in KiwiSaver.
But the day is coming when you will be able to get a lot more help directly from your provider.
- Shelley Hanna is an authorised financial adviser FSP12241. Her free disclosure statement is available on request by calling 06 870 3838 or go to www.peak.net.nz. The information in this article is general and is not personalised. Send your KiwiSaver questions to firstname.lastname@example.org