What Are Default KiwiSaver Funds in New Zealand?
Many New Zealanders are in a KiwiSaver fund they never actively chose.
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These are called default KiwiSaver funds.
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If you joined KiwiSaver through a new job, were automatically enrolled, or signed up without selecting a provider yourself, there is a good chance you were placed into a default fund.
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For some people, this may be perfectly suitable. For others, staying in a default fund for too long could mean missing opportunities to better match their goals (first home or retirement), investment timeframe, and comfort with risk.
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This guide explains what default KiwiSaver funds are, how they work in New Zealand, and whether remaining in one is the right option for you.
​Updated 3 June 2026
What is a default KiwiSaver fund?
A default KiwiSaver fund is the fund the New Zealand Government assigns you to if you join KiwiSaver without choosing a provider or investment fund yourself.
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This commonly happens when:
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you are automatically enrolled into KiwiSaver through a new job
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you start contributing but do not actively choose a provider
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your employer does not have a preferred KiwiSaver scheme
The Government appoints a small number of KiwiSaver providers to offer these default funds.
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These providers may change over time following Government reviews and tender processes, but the purpose remains the same: to give new KiwiSaver members a suitable starting point for investing.
Why do default KiwiSaver funds exist?
Default KiwiSaver funds exist to ensure every eligible New Zealander can start investing for retirement, even if they do not fully understand KiwiSaver yet.
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Without default funds, many people may delay joining or never begin investing at all.
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Default funds are designed to:
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provide a simple entry point into KiwiSaver
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offer diversified investments
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avoid excessively high-risk strategies for new members
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help members begin building long-term savings immediately
They are intended to be a practical starting point, not necessarily a permanent long-term solution.
What type of investments are in default KiwiSaver funds?
Historically, default KiwiSaver funds in New Zealand were conservative funds with large amounts invested in cash and bonds.
This helped reduce short-term volatility, but it also limited long-term growth potential for younger investors.
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In 2021, the Government shifted default KiwiSaver settings to "balanced" investment approaches to better reflect the long-term nature of retirement investing.
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Today, most default KiwiSaver funds are designed to balance:
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medium - long-term growth potential
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diversification
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moderate levels of investment risk
However, each provider still has its own investment strategy, fee structure, and approach to risk.
Default KiwiSaver funds are not necessarily bad funds.
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They are professionally managed, diversified, and suitable for some investors.
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The more important question is whether your KiwiSaver fund matches your:
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age
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goals
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investment timeframe
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risk tolerance
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retirement plans
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first home plans
For example:
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a younger investor with decades until retirement may prefer a higher-growth strategy
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someone planning to buy their first home soon may need lower volatility
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a person approaching retirement may want more stability and lower risk
A default fund cannot personalise these decisions for your individual circumstances.
Are default KiwiSaver funds good?
One of the most common KiwiSaver mistakes in New Zealand is remaining in the same default fund for many years without reviewing whether it still suits your situation.
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Many people:
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never compare providers
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never review fees
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do not understand their current risk level
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assume their default fund is automatically the best option
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stay in the same fund simply because they were placed there originally
Over long periods of time, even relatively small differences in fees, investment strategy, and returns can potentially have a significant impact on retirement savings.
The risk of staying in a default fund too long
​You can check by:
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logging into your KiwiSaver account online
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reviewing your annual statement
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contacting your KiwiSaver provider
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checking the name and type of your current fund
If you are unsure, a KiwiSaver adviser can help identify:
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your provider
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your current fund type
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your risk profile
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whether your current strategy suits your goals
How do I know if I am in a default KiwiSaver fund?
Yes.
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You can switch:
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KiwiSaver providers
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investment funds
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risk levels
at any time.
There are no tax penalties or exit fees for switching KiwiSaver funds in New Zealand.
However, changing funds should ideally be based on:
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your goals
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your investment timeframe
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your comfort with risk
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your long-term strategy
Switching purely because markets are temporarily rising or falling can sometimes lead to poor long-term outcomes.
Can I switch out of a default KiwiSaver fund?
How Solid Steele KiwiSaver Advice Can Help
At Solid Steele KiwiSaver Advice, I help New Zealanders of all ages make smarter KiwiSaver decisions with real world guidance that is easy to understand.
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This includes:
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Reviewing whether your KiwiSaver fund suits your (and your children's) goals
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Explaining risk in plain English
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Comparing KiwiSaver providers
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Helping you understand withdrawal rules
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Helping you avoid common mistakes
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Creating a strategy that fits your situation
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Many people are surprised how much difference the right KiwiSaver setup can make over time.
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Book a Free KiwiSaver Advice Session
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If you are in a default fund now, now is the right time to review your KiwiSaver.
Even small improvements made early can compound into meaningful differences later.
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Book a free 30 minute KiwiSaver advice session with Cameron Steele from Solid Steele KiwiSaver Advice and get clarity around your next steps.
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You can also complete the Discovery Quiz to find out whether your current KiwiSaver knowledge may be holding you back.