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InvestNow KiwiSaver Scheme Review

We review InvestNow's 40 fund KiwiSaver scheme that's big on choice and low on fees
Updated 12 October 2023
Summary of InvestNow KiwiSaver
  • Unlike traditional KiwiSaver Schemes, which typically offer investment options from just a single manager, the InvestNow KiwiSaver Scheme offers investors access to 15 different investment managers across 40 different funds.
  • The 40 funds offer something for everyone, with low-risk cash and fixed interest funds, index-tracking funds, ethical-specific and growth-focused funds available. You can invest in as many (or as few) funds as you want. 
  • The InvestNow KiwiSaver Scheme is also one of the most cost-efficient KiwiSaver offerings in the market, as InvestNow doesn't charge any additional fees such as annual membership or administration fees.
  • Members only pay the fees for the funds they choose to invest in, which is charged by the underlying investment manager themselves. 
  • InvestNow offers fund options that have management fees ranging from as low as 0.03% p.a. and up to 1.50% p.a. Some funds may also have a transaction-based fee such as a buy/sell spread to cover the cost of investing, while a select number of funds also charge a performance fee.
  • Managers available on the InvestNow KiwiSaver Scheme include well-known investment managers such as Castle Point, Fisher Funds, Foundation Series, Generate, Harbour, Milford, Mint, Pathfinder and Russell Investments, with many funds previously unavailable to KiwiSaver investors.
  • InvestNow publishes their underlying fund performance data; you can see the past performance data here.
  • If you’re comfortable with building a portfolio or choosing “just” one or two funds, the InvestNow KiwiSaver Scheme will be an attractive offering.
  • The scheme will appeal to cost-conscious investors, people who want a range of funds to diversify across, or investors that like to tailor their investment portfolio to their own needs.
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. Being comfortable with what you're investing in is the most important aspect of saving for your retirement. InvestNow KiwiSaver's funds have a broad range of management fees, from as low as 0.03% p.a. and up to 1.50% p.a. There are no ongoing membership fees to factor in; all the fees you'll pay will be deducted by the fund manager – InvestNow doesn't charge any additional fees on top of this.

We believe that InvestNow KiwiSaver goes above and beyond in fee transparency, fund choice and high-quality managers who, for the most part, are active investors. For some, a potential drawback is the sheer number of funds – it's arguably a lot to choose from, and it may seem overwhelming. However, having more choice is generally better than not having enough, and being able to mix your money in as many funds as you like can spread the risk. 

Our Review 
In this guide, we outline what the InvestNow KiwiSaver Scheme is, outline the dozens of funds they offer to KiwiSaver members, as well as look 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 InvestNow KiwiSaver as a KiwiSaver investment option.
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This Guide covers:
How does InvestNow KiwiSaver compare with other options?
Advertising Disclosure: We include the funds below based on merit, although we may have commercial arrangements with specific innovative and market-leading schemes for general promotion. Our Advertising Policy has more details. We rely on Morningstar data for all fund returns information.

Video Explainer: To help explain InvestNow KiwiSaver, we suggest watching the video below from a MoneyHubLIVE event held in October 2023. In it, Doug Shephard of MoneyHub and Jason Choy of InvestNow discuss the InvestNow KiwiSaver Scheme, delving into fund manager diversification and its potential influence on the risk-return ratio of a KiwiSaver portfolio.

InvestNow KiwiSaver is our Favourite ​KiwiSaver Innovation in our 2023 Editor's Choice Awards:

Our view:
  • InvestNow doesn't charge an annual membership or administration fee. Investors simply pay for the fees for the fund(s) they choose to invest, which ranges based on the fund and which is charged by the underlying fund manager.​
  • There is a choice of 40 funds (both active and passive), and you can invest in as many (or as few) funds as you want. 
  • Managers include well-known investment managers such as Castle Point, Fisher Funds, Foundation Series, Generate, Harbour, Milford, Mint, Pathfinder and Russell Investments, with many funds previously unavailable to KiwiSaver investors.
  • The scheme will appeal to cost-conscious investors, people who want a range of funds to diversify across or investors that like to tailor their investment portfolio to their own needs.

MoneyHub's editor Christopher Walsh says:
"There's a lot to like about InvestNow KiwiSaver, and we believe it has strong appeal for the DIY investor types who want more control of where their money goes. We also like that InvestNow doesn't charge the annual membership or administration fee and gives access to exclusive fund managers who don't offer their funds to KiwiSaver outside of InvestNow members".

InvestNow KiwiSaver Fees

InvestNow doesn't charge the annual membership or administration fee. Many KiwiSaver schemes charge this, and it can range from $18 to $35+ a year which is directly deducted from your investments. Members simply pay for the fees for the fund(s) they choose to invest, which is charged by the underlying manager themselves. These fees include:

1. Management Fees
Every fund charges a management fee; this ranges from 0.03% p.a. to 1.50% p.a. We itemise a few of the 40 funds and their respective fee in the next section.

2. Transaction-Based Fees
Some funds may also charge a transaction-based fee such as a buy/sell spread, entry/exit fee, or a swing pricing adjustment, to cover the cost of investing. All these fees have a similar effect in reducing the investment amount by a small percentage whenever you buy into or sell out of a fund. 

3. Performance-Based Fees
Some funds also charge performance-based fees. Fund managers who do this include Castle Point, Harbour, Milford and Salt. The reality is that these fees get charged when the fund has overperformed, so your fund will have usually increased in value significantly to trigger such fees.

The Specs of the InvestNow KiwiSaver Scheme and Where Your Money is Invested

In a nutshell, InvestNow KiwiSaver offers:
  • 33 Active Funds (i.e. are managed by an investing team who continuously look for sharemarket opportunities) and 7 Passive Funds (i.e. follow an index, as outlined here).
  • Free membership fees (most other schemes charge $18 - $35+ per year)
  • Fund fees of between 0.03% p.a. to 1.50% p.a.
  • Fund selection is made by the member; you can invest in one fund, or as many as you like at the weighting you prefer (i.e. 20% in one fund, 50% in another fund and 30% in another)

Because of the extensiveness of the funds, we have decided not to summarise them. Instead, you can see a list of them on the InvestNow KiwiSaver website with further information. 

As an example, some of InvestNow KiwiSaver's Funds include well-known fund managers and their respective funds:

InvestNow KiwiSaver - What You Need to Know

Claims made by InvestNow KiwiSaver:

"Low fund charges and no KiwiSaver administration fees"
and
"The InvestNow KiwiSaver Scheme has low-cost investment options with management fees starting from just 0.03% p.a., including GST"

Is it true?
  • Yes - InvestNow doesn't charge an annual administration or member fee (saving $18 - $35+ a year, as almost all KiwiSaver schemes charge this fee).
  • Fund Management Fees charged range from 0.03% (Foundation Series US 500 Fund) to 1.50% (Pathfinder Ethical Growth Fund). 
  • The fees charged by each of the 40 funds are the same as what you'd pay if you invested directly with the underlying manager themselves. InvestNow makes its money by charging the fund managers a fee for being available to investors through its platform and, arguably, only works with high-performing and established fund managers with a solid track record.

"We’ve got expert fund managers covering a wide range of sectors and management styles within the InvestNow KiwiSaver Scheme"

Is it true?
  • Yes – the managers include Castle Point, Fisher Funds, Foundation Series, Generate,  Harbour, Milford, Mint, Pathfinder and Russell Investments.
  • These fund managers often appear on our list of favourite funds. Many funds have been around for at least three years, and some have 10+ years of performance history per this table. InvestNow doesn't work with too many index funds, so you won't find offerings from Simplicity or Kernel on their platform, although they do have passive options from Smartshares, Mercer and their in-house Foundation Series range. 

"The investment options within the InvestNow KiwiSaver Scheme are technically brand new funds, meaning historical performance information is limited."

Is it true?
  • Yes, but InvestNow publishes their underlying fund performance data, which dates back to their inception (as all the funds offered for investment are established funds). 
  • You can see the past performance data here. InvestNow makes it clear that their KiwiSaver Scheme is invested 100% into the underlying funds, and each fund option charges the same fee as the corresponding underlying fund, so the performance of an InvestNow KiwiSaver Scheme fund is expected to be identical to the performance of the corresponding underlying fund.

Who is InvestNow KiwiSaver Suited To?

InvestNow KiwiSaver has a number of unique advantages no other KiwiSaver scheme offers. Firstly, it offers 40 well-regarded funds to choose from – but you can invest in as many (and as much of your total KiwiSaver investment) as you like. 

No other KiwiSaver schemes offer this breadth of choice, at zero additional cost to the end-investor like InvestNow KiwiSaver. In addition to this, many of the funds are exclusive to InvestNow KiwiSaver. If you wanted to invest into some of these funds outside of KiwiSaver you may also need a significant minimum investment (unless using the InvestNow platform).

Secondly, the fees are low and straightforward. There's no annual membership fee. Instead, fund managers charge annual fees (and in some cases transaction-based and/or performance fees), which are identical to what the funds charge if you were investing directly with manager as opposed to through InvestNow. 

If you're comfortable with building a portfolio or choosing "just" one or two funds, the InvestNow KiwiSaver will be an attractive offering. This will appeal to people who want a range of funds to diversify or because they like the underlying funds.

Standout Features:
  1. The transparent fees – the fees are charged directly by the fund's manager. Additionally, no annual membership fees make InvestNow KiwiSaver a leading platform in its own right.
  2. It's free to change funds and/or change the proportions you invest.
  3. The 40 funds offer something for everyone, with low-risk cash and fixed interest funds, index-tracking funds, ethical-specific and growth-focused funds available. All funds are run by established managers with a track record.

Be aware:
  1. As with any investment, markets go up and down. The Dotcom bubble in the early 2000s sank global share markets, as did the 2008 Global Financial Crisis. While many global share markets are now at record highs, this is no guarantee of future earnings.
  2. The funds don't have a lot of "KiwiSaver" performance data despite being long-established funds. To see long-term return data, InvestNow offers a useful table.

The Bottom Line

  • InvestNow KiwiSaver delivers on all its promises and is a refreshing entrant to the KiwiSaver market.
  • The opportunity to select one or many funds may feel intimidating when most schemes offer three or five choices, but the process doesn't need to be overwhelming.
  • Eliminating annual membership fees is innovative and makes the scheme an attractive offering, given it signals low cost while the fund offering is arguably high-quality. There are no joining fees, no exit fees and only a small number of funds charge performance fees. You can adjust your portfolio allocation as little or as often as you like.
  • If you want to invest in index funds (just as Simplicity offers), both the Foundation Series Balanced Fund (management fee: 0.37% p.a.) and Foundation Series Growth Fund (management fee: 0.37% p.a.) offer low-cost diversified funds. In addition, the Foundation Series US 500 Fund (management fee: 0.03%) and Foundation Series Total World Fund (management fee: 0.07%) offer some of the lowest fees on index funds in New Zealand, providing investors access to the popular VOO and VT ETFs from Vanguard. Note that Foundation Series is owned by InvestNow.
  • InvestNow KiwiSaver may not appeal at first – you may be unsure of what to invest in given the numerous options, but we don't think this should put anyone off. Instead, we believe it's an opportunity to properly understand KiwiSaver and take control of your future.
  • To help investors assess and select funds, in line with FMA guidance, each fund has a risk number (1 = lowest, 7 = highest).

InvestNow KiwiSaver is our Favourite ​KiwiSaver Innovation in our 2023 Editor's Choice Awards:

Our view:
  • InvestNow doesn't charge an annual membership or administration fee. Investors simply pay for the fees for the fund(s) they choose to invest, which ranges based on the fund and which is charged by the underlying fund manager.​
  • There is a choice of 40 funds (both active and passive), and you can invest in as many (or as few) funds as you want. 
  • Managers include well-known investment managers such as Castle Point, Fisher Funds, Foundation Series, Generate, Harbour, Milford, Mint, Pathfinder and Russell Investments, with many funds previously unavailable to KiwiSaver investors.
  • The scheme will appeal to cost-conscious investors, people who want a range of funds to diversify across or investors that like to tailor their investment portfolio to their own needs.

MoneyHub's editor Christopher Walsh says:
"There's a lot to like about InvestNow KiwiSaver, and we believe it has strong appeal for the DIY investor types who want more control of where their money goes. We also like that InvestNow doesn't charge the annual membership or administration fee and gives access to exclusive fund managers who don't offer their funds to KiwiSaver outside of InvestNow members".

8 Must-Know InvestNow KiwiSaver Facts

InvestNow KiwiSaver is new, but the funds it offers are managed by reputable companies such as Fisher Funds, Milford and Russell Investments, among others. Our must-know facts below highlight key information about the scheme and who is behind it.

InvestNow KiwiSaver is an extension of the core InvestNow platform

The InvestNow platform continues to grow as a popular choice for non-KiwiSaver investment, just as Sharesies, Tiger Brokers, Hatch and Stake are. You don't need to be a member of InvestNow to join InvestNow KiwiSaver. And, unlike most other schemes, InvestNow offers its investors broad access to over 15 different investment managers, including a mix of actively-managed funds and index funds with a range of fees and investment objectives.

It doesn't matter what your employer's default KiwiSaver provider or fund is - you can select InvestNow KiwiSaver and the fund you want

Because InvestNow KiwiSaver launched in late 2020, most employers wouldn't have heard of it, and even fewer will have considered it as a default provider contender for their employees. But none of that matters – any KiwiSaver member has the right to pick any one of the 30+ providers and the fund they want. So while InvestNow KiwiSaver may be unknown to your employer, you're 100% entitled to pick it as your provider.

There is no minimum investment, no membership fees and it's easy to take contribution holidays (i.e. savings suspension)

As an InvestNow KiwiSaver member, you have full control over where your money goes by way of allocating your money to one or more funds. Unlike most other KiwiSaver schemes, you won't pay any membership fees. And if you want to contribute to your fund at a level above your fixed salary contribution, you can do this through the InvestNow KiwiSaver Scheme. You can also request a savings suspension at any time.

Dividends your fund(s) receive are reinvested, meaning more cash is invested on your behalf

Most of the InvestNow 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. Best of all, all of the funds available for investment are PIEs which means the top tax rate applied to dividends will be 28% (as InvestNow explains here).

InvestNow KiwiSaver offers many actively managed funds from popular and arguably proven fund managers who are focused on outperforming market results by picking market-beating shares

Many of InvestNow KiwiSaver's funds are run by active managers such as Castle Point, Fisher Funds, Generate, Harbour, Milford, Mint, Pathfinder and Russell Investments. These fund managers often appear on our list of favourite funds. The people who look after your money analyse a range of companies and pick ones they believe are undervalued and have a positive future. By doing this, there is an expectation that the share price will increase, giving a return to the investor when it's later sold. 

​Signing up isn't complicated, but you’ll need to decide what fund to invest in first

Signing up to InvestNow KiwiSaver is effortless, but you’ll need to decide your fund first. If you need some assistance, you can use a KiwiSaver Robo and Digital Advice Tool to help guide you as to what type of fund is best for you. Best of all, these tools are free, and one of the services is offered by Milford, which has four funds available via InvestNow KiwiSaver.

Generally, if you're looking for a safe investment with the lowest risk of seeing your original investment fall, a conservative fund could be a suitable option. If you're looking for a higher return and are prepared to have your money in higher-risk investments that could fall in value, you should consider the balanced or growth funds, as they operate in this manner.

If you're not sure of what to invest in and want to have a range of options to pick from, look at Sorted's FundFinder tool.

InvestNow KiwiSaver is operated by InvestNow which has a proven reputation as a funds management platform

With around 1.5 billion dollars invested across the InvestNow platform, the company has a proven experience in offering New Zealanders entry into funds for small minimum investments. We understand that the KiwiSaver offering is an extension to the existing platform and aims to bring a wide range of investment offerings from leading managers. Some funds are also exclusively available to KiwiSaver members via the InvestNow KiwiSaver Scheme.

The funds have, overall, strong performance, but past results are no guarantee of future growth

InvestNow publishes monthly performance data on all funds here. Between these tools, an InvestNow KiwiSaver member has a lot of data to make an informed decision. However, as with any fund, past results don't indicate the future, and no return is guaranteed.
How does InvestNow KiwiSaver compare with other options?
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