Young people dominated the high level of KiwiSaver fund switching during the height of Covid-19 market volatility last year, according to research commissioned by regulator the Financial Markets Authority.
The research, carried out by PwC, found KiwiSaver members aged 26-35 made five times more fund switches than usual, while overall fund switching was three times higher than the normal volume.
FMA Manager – Investor Capability Gillian Boyes (pictured at right) said it was “concerning” that only 9.1% of people who switched to a lower risk fund from February to April 2020 ‘boomeranged’ back to a high growth fund by August.
“This meant a large portion of those who left growth funds would now be in a low-risk fund that may not align with their savings goals, especially if they were a long way from retirement,” she said.
PwC compared and analysed fund switching data of 1.5 million KiwiSaver members from seven KiwiSaver providers –…