KiwiSaver Glossary

Understanding KiwiSaver terminology doesn't have to be complicated. This glossary explains all the key terms in plain English, from PIR rates to contribution holidays.

51 terms defined | Last updated: May 2026

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A B C D E F G H I K L M N O P Q R S T U V

A

Asset Allocation

How your KiwiSaver scheme fund divides investments across different asset types

Active Management

Picking stocks or sectors to beat a benchmark — typically higher fees than passive

Aggressive Fund

A fund with 90%+ growth assets — highest long-term return target, highest volatility

Age 65 Withdrawal

The full-balance withdrawal you can take at 65 (or 5 years from joining, whichever is later)

Annual Statement

Yearly KiwiSaver report showing contributions, fees, returns, and projected balance

Auto-Enrolment

Automatic KiwiSaver enrolment when starting a new job, with a 14–56 day opt-out window

B

Buy/Sell Spread

The difference between buying and selling prices when entering or exiting a fund

Balanced Fund

A fund with roughly equal growth and defensive assets (typically 40-60% growth)

Benchmark

The published market index a KiwiSaver scheme fund compares its returns against

C

Contribution Holiday

A break from making KiwiSaver contributions for up to 5 years

Conservative Fund

A fund with mostly defensive assets (typically 10-34% growth assets)

Cash Fund

Lowest-risk fund holding bank deposits and short-dated debt — capital-preservation focus

Contribution Year

1 July to 30 June — the period IRD uses to calculate the Government contribution

Currency Hedging

Removing NZD/foreign-currency exchange-rate impact from offshore returns

D

Default Fund

The fund you're placed in if you don't choose one when joining KiwiSaver

Defensive Assets

Lower-risk investments like cash and bonds that aim to preserve capital

Diversification

Spreading investments across companies, sectors, and countries to reduce single-point losses

E

Employer Contribution

The 3% of gross salary your employer must contribute to your KiwiSaver account

ESCT

Employer Superannuation Contribution Tax — deducted from employer KiwiSaver contributions

ESG

Environmental, Social, Governance screening of KiwiSaver scheme fund holdings

F

FUM

Funds Under Management - the total value of money a provider manages

First Home Withdrawal

Withdrawing KiwiSaver savings to purchase your first home

FIF

Foreign Investment Fund regime — handled at fund level, not by individual KiwiSaver members

G

Growth Assets

Higher-risk investments like shares and property that aim for capital growth

Growth Fund

A fund with mostly growth assets (typically 63-90% growth assets)

Gross Return

Investment return before fees and PIE tax — bigger than net return, what you actually receive

H

Hardship Withdrawal

Early withdrawal due to significant financial hardship

I

Index Fund

A passive fund that tracks a market index at low cost

K

KS2 Form

IRD form to opt into KiwiSaver via your employer or change your contribution rate

L

Lifecycle Fund

Fund that automatically reduces growth-asset exposure as you age

M

Member Tax Credit

Annual government contribution of up to $521.43 to eligible KiwiSaver members

Management Fee

The annual fee charged by your provider for managing your KiwiSaver scheme fund

N

Net Return

Investment return after fees and PIE tax — the figure that compounds in your account

O

Opt-Out

Formal process of leaving KiwiSaver after auto-enrolment (14–56 day window)

P

PIR Rate

Prescribed Investor Rate - the tax rate applied to your KiwiSaver investment earnings

Performance Fee

An additional fee some funds charge when returns exceed a benchmark

Passive Management

Investment approach matching a market index rather than trying to beat it

Permanent Emigration Withdrawal

Withdraw your balance after permanently moving to a country other than Australia

PIE

Portfolio Investment Entity — the tax structure used by all KiwiSaver schemes

Product Disclosure Statement

PDS — the legally required document describing a KiwiSaver scheme to prospective members

Q

Quarterly Fund Update

QFU — standardised one-page summary published quarterly for every fund

R

Risk Indicator

A 1-7 scale showing how volatile a fund's returns are likely to be

S

Serious Illness Withdrawal

Early access if illness or injury permanently affects your ability to work

SIPO

Statement of Investment Policy and Objectives — sets out how a fund will be invested

Supervisor

Independent licensed entity that holds KiwiSaver scheme assets in trust for members

T

Total Expense Ratio

TER — all-in annual cost of owning a fund as a percentage of net asset value

Tracking Error

How closely a passive fund's return follows its target benchmark

Trans-Tasman Portability

Transfer your KiwiSaver balance to an Australian super fund on permanent emigration

U

Unit Price

The value of one unit in your KiwiSaver scheme fund, used to calculate your balance

V

Voluntary Contribution

Additional contributions you make beyond your regular payroll deductions

Volatility

How much fund returns swing up and down — the basis for the FMA risk indicator

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