AMP KiwiSaver Scheme Review

​Updated 26 January 2021

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Summary of AMP KiwiSaver
We make sense of one of KiwiSaver's largest schemes, and with 28 investment options to choose from, no other provider offers more variety. Uniquely, AMP offers its own funds and funds managed by other providers, with popular examples being the ANZ Balanced Growth Fund, Mercer Balanced Fund and Nikko AM Balanced Fund. Select funds from ASB are also offered.

Unlike other our other KiwiSaver provider reviews, we are giving more weight to media articles, fund performance rankings and commentary from financial experts, cited throughout this page. For the reasons we will outline, our view is that AMP KiwiSaver has struggled against other schemes since their funds launched in 2007.

AMP is in the news quite often. Recently the Consumers Institute announced that AMP customers report well-below average satisfaction. Add on repeated articles about poorly performing funds and proof that the scheme is losing market share and AMP has a lot of work to do to improve its KiwiSaver perception.
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Our Review
In this guide, we outline what the AMP KiwiSaver scheme is, what funds it offers to KiwiSaver members, and how they're different to other funds, as well as looking at alternatives and the level of fees involved.
 
Please note: MoneyHub is not a Financial Adviser, and this guide has been published to explain the investment fundamentals and outline the pros and cons of AMP as a KiwiSaver investment option.
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This Guide covers:

• The Specs of AMP KiwiSaver Funds, Fees and Where Your Money Is Invested
• AMP in the News
• Who is AMP KiwiSaver Suited to?
• ​8 Things To Know About AMP KiwiSaver
• Conclusion​

Performance:
Our KiwiSaver Three-Year Returns Calculator and Comparison shows the latest three-year returns in dollar terms, so you can see which funds over-performed and under-performed compared to above average across all KiwiSaver funds (listed as Balanced, Moderate or Growth). This tool is updated monthly so that you can see the latest results. 

Read this First: Fees, Performance and Understanding What's Best For Your Situation

• A lot of media attention focuses on KiwiSaver fees, but this is only one thing to consider when picking the most suitable provider and fund for your retirement needs.
• We believe that being comfortable with what you're investing in is the most important aspect of saving for your retirement, not the fee you'll pay.
• While we don't focus on the latest returns, we encourage readers to make their own comparisons using our KiwiSaver fund comparison tool.
• Ultimately, deciding upon whether AMP KiwiSaver is right for you will most likely come down to your interpretation of the fund performances in the medium term, their investment strategy and their fees.

The Specs of the AMP KiwiSaver Funds - fees, risks and explaining where your money is invested

• The scheme is managed by AMP Wealth Management New Zealand Limited (Manager), the investment arm of the AMP Group, an Australian-owned company.
• Quarterly fund performance reports are available on the AMP website.
• Each of the funds has a unique risk factor (1 = lowest, 7 = highest), which is driven by its distinct investment profile.
• Fees, returns, risks and the suggested investment timeframe differ between funds, as we outline below. 
• The scheme has seven main funds. AMP has also a further 21 investment options to choose from which include a Lifesteps investment option, a responsible investment fund, diversified fund from other providers and goals based funds.
  
• We have only reviewed the funds that are core to the AMP scheme.

​1: AMP Default Fund
This fund invests in income assets of a short term nature such as bank deposits, floating-rate notes, money market securities with New Zealand-registered banks and New Zealand and overseas shares. It's AMP's largest KiwiSaver fund, as those who sign-up through the IRD without choosing a specific company are automatically enrolled in one of the nine default scheme provider funds, of which AMP is one. 

• Average annual net return since fund launch (2007): ~4%
• Annual fee: 0.41%
• Risk factor: 3
• Fund objective: "To preserve the value of your investment and achieve modest returns".
• Suggested minimum investment timeframe: 2 years
• Investment Composition: Cash and cash equivalents (45%), New Zealand fixed interest (17.5%), international fixed interest (17.5%), Australasian equities (7%) and international equities (13%). 

We say:

• The AMP Default Fund is the most conservative AMP diversified fund, and offers good value for a conservative option  by charging the lowest management fee in the AMP KiwiSaver Scheme. The fund invests predominantly into low-risk products such as bank bonds and deposits, with a small allocation to growth assets such as international shares through index funds.
• The fund's performance is helped by a reasonable 0.41% management fee, which is lower than all but one other default fund in KiwiSaver.
• Despite over $1 billion invested in the fund, the Financial Markets Authority has put in place a financial literacy obligation for default providers such as AMP to educate their members about alternative funds. Despite this, only 6% of AMP members have made an active choice to change from the Default fund in recent years, which is the lowest percentage of any default KiwiSaver provider.
• Our view is this fund isn't reporting extraordinary returns (despite relatively low fees), so existing members would be best to look at alternatives within AMP and another scheme altogether if they are questioning the performance.

​2: AMP Conservative Fund
As its name suggests, this fund invests in low-risk assets, with 76% allocated to income assets and 24% allocated to growth assets. Recent holdings included term deposits with ANZ bank, an NZ government bond and holdings in the overseas-focused Orbis Global Equity Fund (which invests in a range of leading international companies). 

• Average annual net return since fund launch (2007): ~4%
• Annual fee: 1.02%
• Risk factor: 3
• Fund objective: "To achieve modest to medium returns".
• Suggested minimum investment timeframe: 2 years
• Investment Composition: Cash and cash equivalents (23%), New Zealand fixed interest (25%), international fixed interest (28%), listed property (2.5%), Australasian equities (6%), international equities (14.25%), commodities (0.625%) and other alternative strategies (0.625%).

We say:

• The AMP Conservative Fund is the second most conservative diversified fund that AMP offers, and goes beyond the Default fund with investments in listed property shares and emerging markets (such as Asia, Africa and South America). 
• The diversity in investments, performance, the fees remain relatively high. Charging 1.02% p.a. to return around 4% on average makes it one of the more expensive conservative funds available to KiwiSaver members.
• We're unsure why the fees are so high for such a fund that doesn't require active investment judgement. Most investments are held in the medium term, such as bank deposits and bonds, and any sharemarket investments are held through specialist funds managed by third parties. 
• Just like AMP's Default fund, the Conservative fund has reported historically low to average returns and is best described as a wealth-protecting investment option.

3: AMP Moderate Fund 
​​This fund invests 63% of its assets into income-producing investments, such as international bonds and bank deposits, and 37% into growth investments, such as local and international shares. A recent investment included A2 Milk, which has been a top performer on the NZX stock exchange. The Moderate Fund is slightly more aggressive than the Conservative fund, and has performed marginally better since its launch. It charges a slightly higher fee as a result. 

• Average annual net return since fund launch (2007): ~5%
• Annual fee: 1.13%
• Risk factor: 3
• Fund objective: "To achieve modest to medium returns".
• Suggested minimum investment timeframe: 4 years
• Investment Composition: Cash and cash equivalents (18%), New Zealand fixed interest (21%), international fixed interest (24%), listed property (~3%), Australasian equities (11%), international equities (21.5%), commodities (0.75%) and other alternative strategies (0.75%).

We say:

• The AMP Moderate Fund offers a low-risk investment with some exposure to growth assets, meaning day-to-day returns will vary if global markets are up and down.
• Charging 1%+ p.a. to return around 5% on average makes it one of the most expensive Moderate funds available to KiwiSaver members.

4: AMP Moderate Balanced Fund 
A balanced fund is usually split between income-producing assets and growth assets. AMP's Moderate Balanced Fund targets a 53% (income) and 47% (growth) split, making it a 'middle of the range' fund. Growth assets have recently included funds from global investment managers GAM and Orbis, while income assets have included NZ government bonds and bank term deposits. This fund is designed to appeal to those who want to invest in a fund for the medium to long term that takes a risk on global sharemarkets.

• Average annual net return since fund launch (2007): ~5%
• Annual fee: 1.19%
• Risk factor: 3
• Fund objective: "To achieve medium returns".
• Suggested minimum investment timeframe: 4 years
• Investment Composition: Cash and cash equivalents (14%), New Zealand fixed interest (18%), international fixed interest (21%), listed property (~4%), Australasian equities (14.5%), international equities (27.25%), commodities (0.875%) and other alternative strategies (0.875%).

We say:

• The fund would be popular for anyone wanting to invest half (53%) their money in 'low risk' cash-based assets, and half (47%) in growth assets.
• The fees are high for what investors get - with over $700 million invested in the fund, it's a big moneymaker for AMP. And their Lifesteps program suggests the fund would suit investors aged 48 to 56. If you're younger, it may be a good idea to explore other options that can deliver returns more suited to your life stage.
• The annual fee charged (1.19%) is higher than most actively managed balanced funds, and close to four times higher than index funds like the Simplicity Balanced fund.

5: AMP Balanced Fund​
AMP's Balanced Fund targets a 43% (income) and 57% (growth) asset split, making it slightly more growth-orientated than the Moderate Balanced fund above. Growth assets have recently included funds from global investment managers GAM and Orbis, shares in Spark and A2 Milk, while income assets have included NZ government bonds and bank term deposits. This fund is AMP's second-largest, with just under $1 billion invested. It is designed to appeal to those who want to invest in a fund for the medium to long term that takes a risk on global sharemarkets. Investors should expect movements up and down in their KiwiSaver balance in the short term.

• Average annual net return since fund launch (2007): ~6%
• Annual fee: 1.21%
• Risk factor: 4
• Fund objective: "To achieve medium returns".
• Suggested minimum investment timeframe: 4 years
• Investment Composition: Cash and cash equivalents (10%), New Zealand fixed interest (15%), international fixed interest (18%), listed property (4%), Australasian equities (16%), international equities (35%), commodities (1%) and other alternative strategies (1%).

We say:

• Like the Moderate Balanced Fund, this fund would be popular for anyone wanting to invest half their money in 'low risk' cash-based assets, and half in growth shares.
• Again, the fees are high for what investors get - with over $1 billion invested in the fund, it's another big moneymaker for AMP.
• The Lifesteps program suggests the fund would suit investors aged 40 to 47. If you're younger, it may be a good idea to explore other options that can deliver returns more suited to your life stage.
• The annual fee charged (1.21%) is higher than most actively managed balanced funds, and approximately four times higher than index funds like the Simplicity Balanced fund.

6: AMP Growth Fund
This fund invests up to 77% of its money in growth assets and is has around $750 million under management. Recent investments include shares in A2 Milk, Spark, Fisher & Paykel Healthcare, Auckland Airport and Contact Energy, and holdings in international growth funds such as the Orbis Global Equity and GAM Systematic Alternative Risk.

• Average annual net return since fund launch (2007): ~7%
• Annual fee: 1.24%
• Risk factor: 4
• Fund objective: "To achieve medium to high returns".
• Suggested minimum investment timeframe: 7 years
• Investment Composition: Cash and cash equivalents (6%), New Zealand fixed interest (7%), international fixed interest (10%), listed property (5%), Australasian equities (23%), international equities (46.5%), commodities (1.25%) and other alternative strategies (1.25%).

We say:

• The fund is growth-focused, but doesn't perform as well as other growth funds per recent KiwiSaver comparison data supplied by the FMA.
• The fund competes with actively managed funds like the Fisher Growth Fund and Milford Kiwisaver Active Growth Fund but charges more in fees and hasn't performed nearly as well in recent years. 
• Again, the fees are very high for what investors get - with around $1 billion invested in the fund, it's another big moneymaker for AMP.
• The Lifesteps program suggests the fund would suit investors aged 31 to 39. If you're younger, it may be a good idea to explore other options that can deliver returns more suited to your life stage.
• The annual fee charged (1.24%) is higher than most actively managed balanced funds, and is four times higher than index funds like the Simplicity Growth fund.

7: AMP Aggressive Fund
This fund invests up to 87% of its money in growth assets and is AMP's most aggressive diversified fund. Like the AMP Growth Fund, its recent investments include shares in A2 Milk, Spark, Fisher & Paykel Healthcare, Auckland Airport, Contact Energy and Kiwi Property Group, and holdings in international growth funds such as the Orbis Global Equity and GAM Systematic Alternative Risk. Additionally, it held shares in Microsoft.

• Average annual net return since fund launch (2007): ~8%
• Annual fee: 1.35%
• Risk factor: 4
• Fund objective: "To achieve high returns".
• Suggested minimum investment timeframe: 10 years
• Investment Composition: Cash and cash equivalents (5%), New Zealand fixed interest (3%), international fixed interest (5%), listed property (7%), Australasian equities (24.50%), international equities (52.75%), commodities (1.375%) and other alternative strategies (1.375%).

We say:

• AMP's most aggressive fund commands the highest fees, but to date hasn't delivered returns that arguably justified the costs. 
• Lifesteps places anyone under 31 in this fund, suggesting it's most appropriate for driving growth while investors are young.
• If you're after maximum growth, there are a range of alternative funds worth considering.

Other Funds

AMP Funds
The funds below are investment options that AMP also offers to investors. Their fees range from around 0.87% (AMP Cash Fund) to 1.68% (AMP Global Multi-Asset Fund).

​As these funds are far less popular with KiwiSaver members, we have not reviewed them in detail. 

• AMP Responsible Investment Balanced Fund
• AMP Global Multi-Asset Fund
• AMP Income Generator Fund
• AMP Cash Fund
• AMP New Zealand Fixed Interest Fund
• AMP International Fixed Interest Fund
• AMP Australasian Shares Fund
• AMP International Shares Fund
• AMP Passive International Shares Fund
• AMP Property Fund

ANZ Funds - read our review of ANZ KiwiSaver here

• ANZ Conservative Fund
• ANZ Balanced Growth Fund
• ANZ Growth Fund

​ASB Funds - read our review of ASB KiwiSaver here

• ASB Moderate Fund
• ASB Balanced Fund
• ASB Growth Fund

Mercer Funds - read our review of Mercer KiwiSaver here

• Mercer Balanced Fund

NIKKO AM Funds - read our review of NIKKO AM KiwiSaver here

• Nikko AM Conservative Fund
• Nikko AM Balanced Fund
• Nikko AM Growth Fund

AMP KiwiSaver in the News

Relevant media stories from 2017 onward highlight the following:

• AMP has been one of the worst-performing providers. Over a 10-year history (2008-2018), it generated the lowest annual returns among conservative, moderate, balanced, growth, and aggressive classes. In all but the conservative option, its fees were above average. 
• AMP's assets under management still grew to $5.43 billion as at September 30, from $5.08 billion at the start of the year. However, its market share shrank to 10.5 percent from 12.1 percent.

- How does your KiwiSaver fund stack up?, Newsroom.co.nz, October 2018

• A new survey by Consumer NZ said most KiwiSaver Providers  all had a drop in their (customer service) ratings.
• Only 36 percent of ASB customers were satisfied with the service, while AMP and ANZ also scored low at 37 and 41 percent.

- Low satisfaction rates for big-three KiwiSaver providers, RadioNZ.co.nz, April 2019

• "The three worst-performing funds belonged to AMP KiwiSaver, with their Nikko AM Growth, ANZ Growth and LS Growth Fund moving down 1.98 per cent, 1.54 per cent and 1.29 per cent in the period respectively," researcher Christopher Walsh (MoneyHub.co.nz) said.

- All but four KiwiSaver growth funds lost money in past six months, Stuff.co.nz, December 2018

• AMP is the fourth largest KiwiSaver provider, with around 230,000 KiwiSavers and around $5.2 billion of KiwiSaver money under management. But it's no longer interested in wealth management in New Zealand.
• Should savers not like the direction AMP is taking, they can shift their account to another scheme.

- AMP era ends, impacting hundreds of thousands of Kiwis, Stuff.co.nz, October 2018

• Giant KiwiSaver manager AMP has seen its market share fall as a result of poor investment performance, the latest Morningstar survey shows.
• Its market share slumped from 13.7 per cent in 2014 to 11.7 per cent at the end of March, with its $1.3billion default fund ranked bottom of the performance charts compared to other similar funds on both three and five-year performance.
• The cash, balanced, growth and aggressive funds from its "Lifesteps" range of funds were also ranked bottom, or close to the bottom of their sectors on three and five-year performance.

- Poor performance leads to AMP losing KiwiSaver market share, Stuff.co.nz, May 2017

AMP’s Response to Our Review:
AMP talked to MoneyHub and explained the reason for some of the points we’ve published, and recent enhancements. While we can’t verify the accuracy of their comments below, we wish to include it so you can see some of the efforts AMP is making to improve its KiwiSaver offering:

• AMP offers one of the broadest range of choices of any provider, with a range of fees including one of the lowest default fund fees in the market. In the year to March 31, 2019, AMP switched close to 9,000 default customers to an active choice fund. This represents more than the inflow of around 7,000 new default customers in 2018. 
• In addition, AMP consistently attempt to contact 100% of their customers within 20 days of joining to make an active choice about selecting the right AMP investment fund.
• Despite relatively below-average returns since launching their KiwiSaver funds, performance over the longer term is improving as a result of changes made to the investment approach for AMP Capital managed funds in 2015.

Who is the AMP KiwiSaver Scheme Suited To?

Our view is that there are far superior KiwiSaver schemes out there, and we don't see a lot of merit on what AMP offers. High fees and historic low returns (see this NZ Herald article) suggest that the scheme will disappoint investors.
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Pros

• A wide selection of funds - no KiwiSaver provider offers more.
• Investments are diversified and include cash deposits, NZ government bonds and NZ corporate bonds, New Zealand shares and global equities.
• Lifesteps offers investors a range of age-related funds, automatically investing younger investors into growth assets and, conversely, older investors into wealth-protecting income assets.
• AMP offers a responsible investment fund, which combines financial analysis with a sustainability focus.
  
• Investors have access to a mobile digital app called My AMP which keeps track of individual AMP KiwiSaver scheme accounts.
  

Cons

• Recent data from our KiwiSaver comparison tool, which uses Financial Markets Authority data, reported many AMP funds as having low to average performance, relative to their competitors. Stuff.co.nz published a story that this was a long-term issue. 
• The funds also have relatively high management fees, which directly reduce the growth potential of savings.

Be aware:

1. As with any investment, markets go up and down. The Dotcom bubble in the early 2000s sank global sharemarkets, as did the 2008 Global Financial Crisis. While many global sharemarkets are now at record highs, this is no guarantee of future earnings.
2. AMP's default fund, the Default Fund, lacks growth potential, given its low exposure to shares (20% of the portfolio). This means unaware savings are likely to lose out on potential returns by staying with the default option.

8 things to know about the AMP KiwiSaver scheme

AMP is one of the largest KiwiSaver schemes

AMP was one of the first KiwiSaver schemes to market back in 2007, and has over 230,000 members with more than $5 billion invested, or just over 10% of all KiwiSaver investments. Yet, bigger isn't always best, and AMP has been criticised repeatedly for over-charging and under-performing when compared to other KiwiSaver schemes. 
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No matter what your employer's default KiwiSaver provider or fund is, you are entitled to select AMP as your KiwiSaver scheme

Your employer may offer another KiwiSaver provider as their preferred provider, but you are free to choose AMP KiwiSaver as your provider if you feel it's right for you.

In AMP KiwiSaver by default?

• If you join the AMP KiwiSaver Scheme through a preferred provider arrangement then it is likely you will be defaulted into Lifesteps. This is because most employers have chosen Lifesteps as the "default" option and not the Default fund. 
  
• If you did not make a specific choice when signing up to KiwiSaver, you could be enrolled in the AMP KiwiSaver Default fund. Currently, this fund is larger than any other AMP KiwiSaver fund (around $1.4 billion), and has one of lowest fees but also has a conservative investment approach. Historically, it has reported the third-lowest returns.

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Like most providers, AMP charges two fees, and there is no minimum investment

No matter what your fund is, as an AMP KiwiSaver member, you'll pay a streamlined fee:

• Between 0.41% and 1.42% of your KiwiSaver balance per year, depending on your fund, which represents the management and administration fees.
• $23.40 per year ($1.95 per month), which is the membership fee for being in the AMP KiwiSaver Scheme.

If you want to contribute to your fund at a level above your fixed salary contribution, you can do this via the online banking or manually by contacting the client services team. If you stop contributing, you will still pay both fees. 

Dividends your fund receives are reinvested, meaning more cash is invested on your behalf

Many of the AMP KiwiSaver funds invest in shares, and many will pay dividends. These cash payments represent the profits from companies returning it to the shareholders, i.e. you. When a company declares a dividend, your fund will receive money, and it is re-invested into more shares, growing the value of your fund. Despite being a cash payment, and as is the case with ALL KiwiSaver funds, there is no option to take this money as cash until you turn 65. 

All of AMP's KiwiSaver funds are actively managed, but specific investment objectives are not published

While some KiwiSaver funds have specific objectives stating that they will make decisions with the aim of beating certain market indices by a particular percentage, AMP doesn't make such claims. Instead, they state that a fund's objective will be to achieve "medium", "modest" or "high" returns. The fund updates explain the performance in detail.

All of the funds This means the funds are actively managed - each fund has its own key personnel, tasked with the responsibility of portfolio management and analysis. AMP will then select specific investments it sees as undervalued, anticipating that in time, the value of the investment will grow and ultimately make a profit for the fund.

How does this work in practice?

• Each AMP fund and its investment team follows the agreed-upon target investment mix. For example, the target of listed property investments in the AMP Aggressive Fund is 7%.
• This allows the fund manager to invest up to 7% of the fund in assets that fall within the category of 'listed property'.
• The manager can use all of the allocation on one listed property company, or diversify into many investments (which is what happens in practice). As listed property is not without its risks, investment managers will diversify and purchase many different listed property companies.
• A recent report into the holdings of the AMP Aggressive Fund shows an investment in Kiwi Property Group, and there may be others beyond that.
• As market conditions change, the investment manager buys and sells individual investments as they see fit.
• Remember, past fund performance is no guarantee of future results; what you ultimately invest in will be determined by your level of comfort with a fund.

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​Signing up to AMP isn't complicated, and you can pick more than one fund

Signing up to the AMP scheme is easy, and you can create your own portfolio of investments by choosing any combination of the funds. This means you can allocate 20% of your money to one fund, 40% to another, and 10% to another two, giving you diversity. But if this doesn't interest you, you can select one of the 25+ funds AMP offers. 

If you don't select any fund or funds, your contributions will be invested in AMP Lifesteps fund that corresponds to your age. Generally, if you're looking for a safe investment with the lowest risk of seeing your original investment fall, a conservative or default fund could be a suitable option. But many investment professionals would suggest being in a conservative fund for the long term. If you're looking for a higher return and are prepared to have your money in higher-risk investments which could fall in value, balanced and growth funds operate in this manner. 

Generally, if you want to grow your KiwiSaver fund for the long-term, and unless you're risk-averse, the AMP Default fund isn't likely to make you high returns. Share investments are limited to a 20% target, meaning 80% of the money sits in bank accounts, low-interest bonds and other fixed-interest. 

If you are in this fund and would prefer a more aggressive fund, you have the option to switch free of charge, either to another AMP KiwiSaver fund, or any other KiwiSaver fund operated by another scheme.

If you're not sure of what to invest in and want to have a range of options to pick from, look at MoneyHub's KiwiSaver fund comparison tool which includes all AMP funds.

The performance data is easy to follow, and updated regularly

​Fund performance details are published on the AMP website every three months. Unit prices, which track the performance, are updated daily. And, as a member, you can also check a fund balance 24/7 by logging in to the AMP website or downloading the MyAMP mobile app.
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AMP makes a lot of news...

AMP frequently appears in the media for all the wrong reasons. Many journalists and financial commentators see it as an under-performing scheme. No other scheme offers more funds, but it's almost certain that better deals are found elsewhere in KiwiSaver.

Our Conclusion​

• AMP KiwiSaver does not have a good reputation when it comes to fund performance, customer service and fees.
• AMP has an enormous number of funds to pick from, but better deals for similar investments can be found elsewhere. ​
• In late 2018, the Herald reported "AMP has been one of the worst performing providers. Over a 10-year horizon it generated the lowest annual returns among conservative, moderate, balanced, growth, and aggressive classes. In all but the conservative option, its fees were above average." We believe this sums up the scheme's offering overall.
• The fund choice may be large, but customers are aware of the scheme's limitations - a Stuff.co.nz article, Poor performance leads to AMP losing KiwiSaver market share, suggests the scheme is losing market share as people switch to better funds. 

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Do you have experience with AMPs KiwiSaver scheme that you would like to share with our readers? Email our research team who would be delighted to hear from you.