Last year was the best yet for KiwiSaver returns, but many New Zealanders are failing to cash in on the windfall.
ASB KiwiSaver fund returns ranged from 7.3 percent to 20 percent after taxes and fees, depending on what investment scheme people were signed up for, according to new data released by the bank.
But ASB's head of KiwiSaver Aidan Vince says despite the high returns, many people are opting for conservative funds and missing out on higher returns.
"Most New Zealanders will still be sitting in a conservative fund, they'll have a lot of their money invested in more traditional bank products and so a lot of New Zealanders are actually missing out on a lot of these great returns that we're talking about," Vince told Newshub.
"If you'd had $20,000 in a conservative fund at the start of the year, that decision has cost you $2500 over the course of the year."
Vince said despite the high returns - 2019 was the best year for ASB KiwiSaver Scheme diversified fund returns since KiwiSaver was launched in 2007 - perceptions about the fund are slow to catch up.
According to the latest ASB KiwiSaver survey, just 13 percent of respondents thought KiwiSaver was the best bank product for returns.
"Given that it's been a phenomenal year for returns, it's disappointing that this doesn't seem to be having a huge impact on perceptions," Vince said.
He said although past performance was no guarantee of future performance, there was now more than a decade's data showing how KiwiSaver schemes perform in a variety of economic situations, giving investors a deeper understanding of how it works.
Economist Cameron Bagrie says the country's KiwiSaver fund now has around $64 billion in it, with around three million people signed up to the scheme.
"It's helped deepen New Zealand's savings pool - [it's a] great story," Bagrie told The AM Show on Monday.
He said you'd be stupid not to be a part of it.
"The earlier you start the better. Every parent out there should be enrolling their children, it's a big way of teaching them about money, tracking things along the way. And the sooner you're in the sooner you win."
Although it makes sense for many people to diversify their investments and not just be conservative, Bagrie said it was important for people to seek professional advice to figure out the best plan for them.
"We're in an economic environment at the moment where interest rates are incredibly low - it's encouraging people to go up the risk curve to get return on the other side," Bagrie said. "That's an environment where you can make mistakes and you can dust a fair bit of cash. So once again the suggestion is go seek some proper, independent advice because risk profiles are going to be different for different people, different parts of society - it's about realising what your personal circumstances are and getting that proper advice."