Low-Fee KiwiSaver Funds Vs High Returns: How they Compare

Are low-fee KiwiSaver schemes worth it? Or are you better off paying higher fees to chase better returns. Canstar crunches some numbers to find out.

First things first. We have to point out that in the world of investment, nothing is certain, and that past results are not indicative of future returns. So just because you’re in a low-fee KiwiSaver fund doesn’t mean that you’ll necessarily earn greater, or lower, returns than somebody paying higher fees.

But it is worth looking at average figures, and past results, when making an informed decision about where to put your KiwiSaver. So, here at Canstar, we thought it would be interesting to compare the performance and fees of the KiwiSaver funds with the highest returns in our database, with those charging the lowest fees.

Is letting low fees guide your choice of KiwiSaver fund a good idea or, in the long term, will one charging you more to manage your investments reap greater returns?

But before we go any further, let’s spend a minute to look at why some funds charge higher fees than others.

→ Related article: New Zealand’s Top 10 KiwiSaver Schemes

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Low-fee KiwiSaver vs high returns: active vs passive

A lot of the difference in fees comes down to whether a fund is actively or passively managed.

All fund mangers judge their performance against market averages, or indexes, for example the Dow Jones Industrial Average, or the NZX 50. These represent a hypothetical portfolio of investments that provide an average picture of a market’s health: whether it’s going up or down, even if individual shares are tracking in the opposite direction.

Passive fund managers use computer software to buy shares that reflect the make-up of these indexes. By tracking an index and buying and selling corresponding shares automatically, they expect to match their chosen index’s (it is hoped) ever-upward trajectory.

However the crux is that because passive investment is designed to only track the market, it’s never going to outperform the market. And if the market slumps, a passively managed fund will follow the same path.

Active fund managers, on the other hand, engage in research and analysis. They make educated choices: buying undervalued investments before they increase in price, or selling an overvalued investment before its price drops, in an attempt to beat the market.

They buy and sell proactively and aim to make returns above indexed averages, whichever way the market is headed. But as actively managed funds require a lot more human input, they usually come with higher fees. Plus, of course, they can also make wrong decisions and lose their investors’ money regardless of the way the market is tracking.

→ Learn more: Active Investing vs Passive: What it Means for your KiwiSaver

Low-fee KiwiSaver vs high returns: the comparison

According to the most recent KiwiSaver report, the average New Zealander has $26,410 invested. So, for the sake of our comparison, we’ve rounded that up to a neat $30,000. And because half of the most popular KiwiSaver funds by total membership are growth funds, we’ve stuck with that fund profile, too.

In Canstar’s database, when it comes to returns, the five funds with the best track record over the past five years are:

Growth funds with best five-year returns in Canstar’s database


Fund Name  5-year Returns
After Fees
Total Annual Fee
Socially Responsible
High Growth Fund



Focused Growth Fund 13.31% $492
Milford Active Growth Fund 13.13%


Milford Active Growth
Wholesale Fund
12.96% $433.80
Fisher Funds Growth Fund 12.43%


(Source: www.canstar.co.nz. Based on KiwiSaver Growth funds with a balance of $30,000 in Canstar’s database. Correct of 30/03/22.)

These five funds also have some of the highest fees. But as you can see, across the five providers, there’s still a disparity of over $100. However, there’s also quite a difference in their average five-year returns, too, from 12.43% to 15.3%.

So how do these funds compare with the growth funds with the lowest fees on our database?

Growth funds with lowest fees in Canstar’s database


Fund Name 5-year Returns
After Fees
Total Annual Fee
Growth Fund 11.96%


bnz logo

Growth Fund 11.07% $174
Superlife wins Canstar outstandling value award Growth Fund 9.33%


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Growth Fund 10.44% $240
Growth Fund 10.54%


(Source: www.canstar.co.nz. Based on KiwiSaver Growth funds with a balance of $30,000 in Canstar’s database. Correct of 30/03/22.)

As you can see, while Simplicity is the cheapest by far, we’re only looking at a couple of hundred dollars in fees per year difference between the funds with the lowest fees and the ones with the highest returns.

And, ultimately, when you look at the returns after fees, none of the funds charging the lowest fees have managed to outperform the top-performing funds.

Low-fee KiwiSaver vs high returns: the results

If we take our average $30,000 balance, and work out the annual compounded returns it would earn over five years based on all the funds’ current five-year returns after fees, it looks like this:


After 5 Years
Total Fees
After 5 Years









Fisher Funds





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ASB Logo


Superlife wins Canstar outstandling value award



What this reveals is that when looking at KiwiSaver funds and providers, past 5-year returns after fees is a more important factor to consider than just fees alone. In fact, when looking at the best KiwiSaver providers, it’s prudent to consider a whole range of factors.

And this is what Canstar’s expert research team does when it awards KiwiSaver providers our prestigious awards and star ratings. Using a sophisticated and unique ratings methodology, our team delves deep and compares the costs, features and performance of KiwiSaver funds. And, importantly, we don’t just look at short-term results.

KiwiSaver is intended as a long-term investment. And our research reflects this, rewarding providers for their average returns over the past five years. For our awards, each of the eligible KiwiSaver funds is rated across three main categories:


Most importantly, this covers annual returns, but it also looks at consistency of performance. This means how returns fluctuate year to year – whether they are consistent or vary wildly.


Features include: the range of investment options offered by a KiwiSaver provider, the financial advice, tools and support provided, and ease of member access.


Annual cost to members, including fees and total fund charges.

Compare KiwiSaver Providers with Canstar

For example, the comparison table below displays some of the products currently available on Canstar’s database for a KiwiSaver member with a balance of $50,000 in an Aggressive fund, sorted by Star Rating (highest to lowest), followed by company name (alphabetical) – some products may have links to providers’ websites. Use Canstar’s KiwiSaver comparison selector to view a wider range of super funds. Canstar may earn a fee for referrals.

So if you’re looking for the best KiwiSaver, don’t just focus on fees and charges. Do your research, compare providers and look for the provider that best matches your appetite for risk and your long-term goals.

If you want to read more about our latest KiwiSaver Awards, click on the button below.

Compare KiwiSaver providers for free with Canstar!

About the author of this page

Bruce PitchersThis report was written by Canstar’s Editor, Bruce Pitchers. Bruce began his career writing about pop culture, and spent a decade in sports journalism. More recently, he’s applied his editing and writing skills to the world of finance and property. Prior to Canstar, he worked as a freelancer, including for The Australian Financial Review, the NZ Financial Markets Authority, and for real estate companies on both sides of the Tasman.

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