I recently queried ASB's KiwiSaver fees.
There appears to be a duplication of charges under the guise of "administration" and "management".
Two people at ASB's customer centre were unable to tell me specifically what each of these fees covered.
Our KiwiSaver is online; once a year we may get a brochure but we never read it as it doesn't make any sense to us, not speaking banking speak.
Our statements come online, along with our ASB statements - ie, we simply look up our KiwiSaver account when we need to, rather than resorting to a paper statement sent by ASB to us.
When queried about the management fee ASB advised that it was to manage the KiwiSaver portfolio.
As we are in our 60s our KiwiSaver account is in the NZ Cash Fund ... little management required there.
ASB KiwiSaver takes two dips at the cherry in terms of funds ... $2.50 a month is charged for administration and a varying amount between $2.20 and $2.50 a month for management fees.
In light of the fact that our payment is paid direct into the fund and much of this will be automated (directing our $87 a month to the right fund) I am unsure what we are actually paying for.
I am happy to pay one fee of $2.50 but I think two fees of like amounts simply to hear from ASB once a year is a little over the top.
It's a great idea to keep an eye on your KiwiSaver fees because, as Chris Douglas from investment researchers Morningstar says, "Fees are the one constant that will always eat away at your returns."
Morningstar regularly surveys the KiwiSaver market and its reports, which are available online at www.morningstar.co.nz/Kiwisaver, are a good place to check how the fees you pay stack up against similar funds offered by other providers.
Generally you can expect to pay more in fees if your fund has more money invested in riskier assets, such as shares or property, or is regularly buying and selling those assets in an effort to boost investment returns.
Craig Haycock, ASB general manager products and strategy, took a look at your query about the fees ASB charges on its NZ Cash fund: "As you correctly point out, the ASB KiwiSaver scheme has an administration fee of $2.50 per member per month, and a management fee of between 0.35 per cent and 0.70 per cent per annum [depending on the fund].
"The management fee is calculated as a percentage of the value of your investment in the fund - for example a member with a $10,000 balance in the NZ Cash Fund could expect to pay around $35 in management fees for the year [deducted monthly] in addition to the administration fee.
"Transparency is a core value for ASB.
"The above fees are deducted from ASB KiwiSaver scheme accounts monthly so members can see exactly what they are paying.
"We also recognise the impact of fees on long-term savings.
"Most KiwiSaver schemes charge an administration fee and a management fee.
"Some schemes also charge a trustee fee and/or expenses to their funds (the ASB KiwiSaver scheme does not).
"There is a comparison tool at www.sorted.org.nz that you can use to compare the cost of the different funds available in the market.
"Administration fees generally cover the costs of investment administration, customer services, online services and printing and posting of member and tax statements.
"Management fees describe the costs of managing your money - this can include other specialist fund manager fees, research analysts, portfolio managers and fund accountants.
"It's great to hear that you are making the most of our online services - we continue to focus on improving them to meet our customers' needs.
"We also send newsletters via email (you can update your email address using our online banking service) to ensure members are making the most of the features of KiwiSaver.
"We try to make our member communications as useful as possible (and keep the banking speak to a minimum)," says Haycock.
If you're not happy with the fees being charged by your provider or need some explanation about what bang you are getting for your fees buck, you needto contact your provider in the first instance.
If you are not making any headway with your provider or its trustees you can take your grievance to an independent disputes resolution service at no cost.
Details about that process are spelled out on the Government's KiwiSaver website: kiwisaver.govt.nz/providers/about/complaints/
Disclaimer: Information provided is stated accurately to the best of the respondent's knowledge at the time of publication. It is general in nature and should not be construed, or relied on, as a recommendation to invest in a particular financial product or class of financial product. Readers should seek independent financial advice specific to their situation before making an investment decision.
To have your KiwiSaver questions answered by the Herald's panel of industry players email Helen Twose, helentwose@gmail.com.