If you were auto-enrolled in KiwiSaver and didn’t choose a provider or fund, you ended up in a default fund. Millions of New Zealanders are in default funds — and many don’t realise it, or don’t know what it means for their savings. Here’s what you need to know.
What Is a KiwiSaver Default Fund?
When you start a new job in New Zealand and don’t actively choose a KiwiSaver provider, your employer is required to enrol you. If no provider choice is made within the enrolment window, IRD allocates you to one of the government-appointed default providers in a default fund.
The default fund is a safety net — it ensures you’re enrolled in something rather than nothing. But it’s not necessarily the best option for your situation.
The Nine Default KiwiSaver Providers (2021–)
As of December 2021, the nine government-appointed default providers are:
| Provider | Default fund type |
|---|---|
| ANZ | Balanced |
| ASB | Balanced |
| BNZ | Balanced |
| Booster | Balanced |
| Fisher Funds | Balanced |
| Kiwi Wealth (now Kernel) | Balanced |
| Mercer | Balanced |
| Milford | Balanced |
| SuperLife | Balanced |
All nine default funds must be balanced funds under the 2021 default fund rules — a significant change from the pre-2021 defaults, which were conservative or low-risk.
What Changed in 2021?
Before December 2021, default KiwiSaver funds were conservative — mostly bonds and cash. This was appropriate for short-term savers but terrible for young workers who needed growth over 30–40 years.
The government changed the rules: all new default allocations must be to balanced funds (approximately 50/50 growth/income split). Members already in the old conservative defaults were moved to balanced as part of the transition.
Why this matters: A 25-year-old in a conservative default fund from 2007 to 2021 received significantly lower returns than they would have in a balanced or growth fund. The 2021 change corrects this going forward.
Are You in a Default Fund?
You might be in a default fund if:
- You started a new job and didn’t choose a provider within the enrolment window
- You were auto-enrolled and made no KiwiSaver decisions
- You can’t remember choosing a fund or provider
How to check:
- Log in to myIR at ird.govt.nz
- Navigate to KiwiSaver
- Your provider and fund type are listed there
Alternatively, search your email for communications from a KiwiSaver provider — default allocations come with a letter or email.
Is a Default Fund Bad?
Not necessarily — the 2021 default balanced funds are reasonable. A balanced fund is appropriate for members in the middle of their careers. However:
- If you’re under 40: a balanced default is likely too conservative — you’d be better off in a growth or aggressive fund
- If you’re over 55: a balanced fund may be appropriate, or you may want to shift to conservative
- If you’re in a high-fee default provider: you may be paying 0.5–1.1% when a low-cost provider charges 0.3–0.5%
The default balanced fund is significantly better than the old conservative default — but it’s still unlikely to be the optimal choice once you’ve actually considered your options.
What Should You Do If You’re in a Default Fund?
Step 1: Find out who your default provider is (myIR or a recent statement)
Step 2: Check your fund type — if you’re in a balanced fund and you’re under 50, consider whether a growth fund is more appropriate for your time horizon
Step 3: Check fees — compare your default provider’s fees against lower-cost alternatives using Sorted.org.nz
Step 4: Make an active choice — even if you decide to stay with your current provider and fund, making that an active decision (rather than passive inertia) is better
Switching Out of a Default Fund
Switching to a different provider or fund type is straightforward and free:
- Choose a provider (see best KiwiSaver providers NZ)
- Complete an enrolment form with the new provider online
- They contact your old provider and arrange the transfer
- Transfer takes 10–15 business days
You can also stay with your default provider and simply change your fund type (e.g., from balanced to growth) via the provider’s online portal or by contacting them directly.
See switching KiwiSaver providers for the full process.
Default Funds and the Member Tax Credit
Being in a default fund has no impact on your MTC eligibility. As long as you’re a qualifying KiwiSaver member contributing at least $1,042.86 per year, you’ll receive the full $521.43 MTC — regardless of which provider or fund you’re in.