KiwiSaver provider Kiwi Wealth has launched a new online tool to help its members figure out how much they are saving for retirement and what kind of annual income it could give them.
The government-owned provider will offer most of its 150,000 members the opportunity to look at the impact of different contribution levels and different funds on their savings and then convert the money into an annual income based on how long they could potentially live for.
The move comes just a week after accountancy firm KPMG warned KiwiSaver providers they could face a legal risk if they don't do more to ensure their members are in the right investment fund.
Joe Bishop, Kiwi Wealth's head of retail wealth and marketing, said it had spent a year road-testing its tool and adjusting it to meet what members want.
"We took a lot of feedback which showed we needed to provide an end to end service."
Bishop said the tool would help show people how the decisions they made today would impact their future retirement.
The tool allows people to adjust their contribution rate from 3 to 4 or 8 per cent and then sends them an email which can be forwarded to a member's workplace to request a change be made through their employer.
If a member decides they need to change their investment fund it also allows them to do that online with the switchover occurring at the next valuation point for the fund.
The tool doesn't incorporate New Zealand Superannuation into its calculations at the moment but Bishop said it planned to add that ability in the future as well as the ability to incorporate other investments like shares or rental property which would give people a fuller picture of what income they could have in retirement.
Bishop said converting the KiwiSaver lump sum into an annual amount could show people the gap between what they currently earn and what they would get in retirement.
The tool is available to it members who are between the ages of 18 and 65.
Bishop said too many New Zealanders had not thought much about their KiwiSaver scheme since they initially enrolled, with many still in their default fund.
"KiwiSaver is a long-term investment, not a simple, set-and-forget savings account. It makes sense to focus on helping people visualise their retirement income."