Key Points:

If you've checked your KiwiSaver balance recently you could be feeling a bit down. Despite putting money into your fund it could be sitting at a lower level than at the end of last year. That's because share markets around the world have had a rough start to the year. Read also:KiwiSaver members urged not to panicNZ stocks falls and global shares enter bear marketWhat investors should ask themselves But that's no reason to panic and switch your money to another fund or provider. Elliot Smith, an analyst with Morningstar - a research company which collects performance data on KiwiSaver funds, says his advice to people is not to do anything provided they are in the right fund for them. "My advice is not to panic. People should be focusing on their long term goals. "They shouldn't be looking at their balance on a frequent basis." If you're in your 20s and 30s there is plenty of time for your KiwiSaver fund to bounce back and if you're saving for a house your money should be in a more conservative fund.

They shouldn't be looking at their balance on a frequent basis.
Eliot Smith, Morningstar analyst
Savers who pull out of a growth fund now and switch to a conservative fund risk crystallising their losses and missing out on the recovery when the market does bounce back. Smith cites last years market down-turn which hit KiwiSaver funds in the September quarter and then bounced back after a strong recovery in December. "During the fourth quarter the performance was really strong. All of the losses were recovered." Smith says those who switched in September would have cemented their losses. "If you had moved from a growth to a conservative fund the upside from the strong December quarter would not have been as great." "You would not have caught up to where you capital was [before the down-turn]." Sure, you could have played it exactly right and switched back to a growth fund just as the tide was turning but the odds of being able to do that are slim. "Even the professionals can't do it," Smith says. One positive way to look at a market down-turn is to think of it as a massive share sale. At the moment there's a discount on everything. If you were out to buy an appliance or tv it would be the time to buy. For those thinking about retirement it's a chance to buy company shares at a cheaper price. While we don't know when the markets will bounce back history shows they will recover sometime in the future. In the mean-time stop checking your balance and start thinking about what you will do with the money when you get to 65.