Most KiwiSaver articles focus on who’s performing best. This one focuses on the other end of the table — the funds that have consistently delivered the worst after-fee returns, and why it matters for the hundreds of thousands of New Zealanders who are in them.
Key finding: The worst-performing KiwiSaver funds are almost always the most expensive ones. High fees are a reliable predictor of poor after-fee outcomes.
Why “Worst Performing” Requires Context
Before ranking the underperformers, two important qualifications:
1. Compare like with like. A conservative fund will always underperform a growth fund in a rising market — that’s not underperformance, that’s risk profile. This article compares funds within the same risk category.
2. After-fee returns are what matter. Gross returns (before fees) can look respectable even for expensive funds. After-fee returns — what you actually receive in your account — tell the real story.
3. Short-term underperformance isn’t the same as structural underperformance. A single bad year can reflect market timing, not poor management. The concern is persistent multi-year underperformance, especially when combined with high fees.
For context on how to read performance data correctly, see our KiwiSaver fund performance guide.
The Pattern: High Fees Drive Poor After-Fee Returns
The clearest pattern in NZ KiwiSaver performance data is that funds charging the most tend to deliver the least after fees. This is not coincidental — fees are a guaranteed drag on returns, every year, regardless of market conditions.
| Provider | Growth fund fee (approx.) | 5-yr after-fee return (indicative) |
|---|---|---|
| Fisher Funds | ~1.35% | ~7.0%–7.8% |
| ANZ | ~1.06% | ~7.5%–8.5% |
| Westpac | ~0.90%–1.05% | ~7.0%–8.0% |
| Craigs | ~1.00%–1.30% | ~7.0%–8.5% |
| Simplicity | 0.31% | ~8.0%–9.5% |
| BNZ | ~0.40%–0.55% | ~8.0%–9.0% |
| Milford | ~0.85%–1.05% | ~9.5%–11.5% |
The data shows Fisher Funds and Westpac consistently delivering below-median after-fee returns despite charging fees that are 2–4× higher than the cheapest alternatives.
Worst Performing Growth Funds — 5-Year After-Fee Returns
Fisher Funds Two Growth
Fisher Funds charges approximately 1.35% on its growth fund — one of the highest in the market. Its 5-year after-fee return has been in the range of 7.0%–7.8% p.a., placing it below Simplicity (0.31% fee), BNZ, Booster, and even some balanced funds from better-performing providers.
The cost of staying in Fisher Funds Growth vs Simplicity Growth:
| Balance | Fisher Funds (~1.35%) | Simplicity (0.31%) | Fee difference/year |
|---|---|---|---|
| $50,000 | $675/year | $155/year | $520/year |
| $100,000 | $1,350/year | $310/year | $1,040/year |
Over 20 years on a $100,000 balance, a persistent $1,040/year fee difference compounds to well over $30,000 in lost retirement savings — before accounting for the performance shortfall.
Fisher Funds is one of the most common providers for members who enrolled through Kiwibank historically, and for members who defaulted into it via employer schemes. If you’re in Fisher Funds, this is worth reviewing. See the Fisher Funds KiwiSaver review and our Fisher Funds vs Milford comparison.
ANZ Growth (OneAnswer)
ANZ’s OneAnswer KiwiSaver growth funds charge approximately 1.06% — well above the market median. ANZ’s returns have been broadly average to below-average on an after-fee basis relative to cheaper alternatives.
ANZ is the largest KiwiSaver provider in NZ by funds under management, which means a very large number of New Zealanders are paying above-average fees for below-average after-fee outcomes. ANZ’s scale has not translated into fee savings for members.
See the ANZ KiwiSaver review and the ANZ vs Simplicity comparison.
Westpac KiwiSaver Growth
Westpac charges approximately 0.90%–1.05% on growth funds. Its after-fee 5-year returns have been in the range of 7.0%–8.0% p.a. — below Milford, Simplicity, BNZ, and Generate, despite higher fees than several of those providers.
Westpac is notable because it’s one of the major bank providers with the weakest fee-performance combination. Unlike ASB and BNZ — which have invested in index-blended approaches that deliver competitive after-fee returns — Westpac’s active management has not justified its fee premium.
See the Westpac KiwiSaver review.
Worst Performing Conservative Funds
Conservative fund underperformance is often overlooked because the numbers seem small. But the compounding effect of paying 0.80%–1.00% in fees on a conservative fund — which might only return 4.0%–5.5% gross — is severe. Fees can consume 15%–25% of gross returns in a conservative fund.
Conservative fund fee-return comparison (5-yr, indicative):
| Provider | Fee (approx.) | 5-yr gross return | After-fee return |
|---|---|---|---|
| Fisher Funds Conservative | ~1.10% | ~5.2% | ~4.1% |
| ANZ Conservative | ~0.85% | ~5.0% | ~4.15% |
| Simplicity Conservative | 0.31% | ~5.0% | ~4.69% |
| Milford Conservative | ~0.85% | ~5.8% | ~4.95% |
A member in Fisher Funds Conservative vs Simplicity Conservative loses approximately 0.6% p.a. after fees — on what is supposed to be a capital-preservation vehicle.
The Default Provider Problem
A significant driver of underperformance concentration is the default provider system. When a new employee is enrolled in KiwiSaver and doesn’t actively choose a provider, they’re assigned to one of the six default providers:
- BNZ
- Booster
- Generate
- Milford
- Simplicity
- SuperLife
Historically (pre-2021), the default providers included ANZ, ASB, and Fisher Funds — meaning large numbers of members were defaulted into providers that are now known to underperform on a fee-adjusted basis.
Many of those members have never switched. If you were enrolled before July 2021 and have never chosen your provider, there’s a reasonable chance you’re in an expensive legacy default scheme. Use Sorted’s KiwiSaver Fund Finder to check.
Who Is Most at Risk
The members most likely to be in a worst-performing fund are:
- Members who enrolled many years ago and never switched — often in legacy ANZ, ASB, or Fisher Funds schemes
- Members whose employer chose the provider — some employer schemes default to bank providers
- Members who enrolled through a Kiwibank branch — historically funnelled into Fisher Funds
- Members who chose a provider based on brand familiarity rather than performance — banks have strong brand recognition but weak fee-performance records
What to Do If You’re in an Underperforming Fund
- Find out which fund you’re in. Check your IRD myIR account or the provider’s app.
- Look up the 5-year after-fee return on the FMA’s KiwiSaver dashboard or the provider’s website.
- Compare against Milford, Simplicity, BNZ, and Booster in the same risk category.
- If you’re paying more than 0.60% and underperforming the median — consider switching.
- Switch online — it takes 10 minutes and transfers automatically. See how to switch KiwiSaver providers.
There is no exit fee, no tax penalty, and no loss of KiwiSaver membership when you switch. The only cost of switching is the 10 working days your balance is out of the market during transfer.
Frequently Asked Questions
Which KiwiSaver provider has the worst performance? On a consistent after-fee basis, Fisher Funds and Westpac have delivered below-median returns in their growth and balanced categories relative to cheaper alternatives. ANZ also consistently underperforms on a fee-adjusted basis given its high charges.
Is it bad to have a low-performing KiwiSaver fund? Yes, over the long term. A 1% annual fee difference on a $100,000 balance costs approximately $30,000–$50,000 over 20 years in foregone compounding. Members in consistently high-fee, low-return funds are materially worse off at retirement.
Can I switch out of a bad KiwiSaver fund easily? Yes. You apply to your new provider directly, and they manage the transfer from your current provider. There are no fees, no penalties, and membership continuity is maintained. Allow 10 working days for the transfer.
Does switching KiwiSaver affect my employer contributions? No. Employer contributions continue regardless of which provider you’re with, as long as you remain enrolled in KiwiSaver.
What to Read Next
- Best Performing KiwiSaver Funds NZ — who’s at the top
- KiwiSaver Fund Performance Guide — how to read performance data correctly
- KiwiSaver Fees Comparison NZ — all providers ranked by fee
- Cheapest KiwiSaver Fund NZ — lowest-cost options
- Switching KiwiSaver Providers — how to move in 10 minutes
- Cheapest vs Best Performing KiwiSaver — the fee vs return framework