KiwiSaver Tips Every First Home Buyer Should Know

If you’re buying your first home, or you’ve just bought one, there are two simple KiwiSaver moves you should know about. One helps protect your deposit right before you buy, and the other helps grow your savings long-term after you’ve settled in. Making these switches at the right time can save you stress and set you up for a stronger financial future.

Protect Your Deposit by Switching to a Low Risk Fund Before Buying

If you're planning to purchase a first home soon, it may be a smart move to switch your KiwiSaver into a low risk fund, like a cash fund. Why? Because these funds offer the most protection for your investment.

When you’re close to buying, the last thing you want is for the market to drop and for your KiwiSaver balance (the money you’re counting on for your deposit) to take a hit. By moving your KiwiSaver into a cash fund, you’re essentially putting your deposit money in a safe place while you finalise your purchase.

Switch to a High Growth Fund After Buying

Once you’ve got the keys to your new home, it’s time to think about growth again. Switching your KiwiSaver into a growth or aggressive fund may be the best move - especially if you’re young and have plenty of years before you plan to retire.

Since you likely won’t touch your KiwiSaver for decades, switching to a high growth fund gives your money the best chance to grow over the long term. These funds do come with more risk, but with time on your side, they also offer the highest potential returns. Just keep in mind — high growth funds are best suited for a time frame of at least 10 years. So if you're over 55, you may need a different strategy.

Keep in Mind…

Making these two simple moves — cash before buying, growth after — can help you protect what you need when you need it, and then promote growth for the future. Depending on your individual situation, It may be a smart way to manage your KiwiSaver and get you closer to your homeownership goals without unnecessary risks.

But here’s the thing: different providers excel at different types of funds. If you’ve had success with one provider in a balanced fund, but now you’re switching to a growth fund, you might need to reconsider your provider. That’s why a review with a independent KiwiSaver adviser can be so valuable.

If you’d like a hand navigating this process, reach out to the MoneyGuide team. Our expert KiwiSaver advisers will guide you on exactly when to make the switch and help you find the KiwiSaver provider and fund that best fit both your short-term plans and long-term goals.

And the best part? It’s completely free.

*This information is intended as general guidance only and does not constitute personalised financial advice. For personalised advice, please speak with a licensed financial adviser.