Trustees Executors provides registry services for about 25% of all KiwiSaver money.

But Bessemer said, in recent weeks, the rate of people switching between funds had increased at a rapid pace.

"For example, we might do an average of say, 30 to 50 switches a day, but at the moment we are doing thousands. Imagine the type of impact that has on the market."

Many investors have been spooked by seeing their balances fall by 15% or more since Covid-19 started shaking the markets, after years of strong returns.

"That sell off of growth funds is turning over thousands of securities every day, just through people switching. That is where advisers need to be going out to clients and saying KiwiSaver is not a short-term thing. They need to be thinking about what their long-term prospects are.

"Changing from growth to conservative crystallises losses. That is going to have a flow-on effect to future performance.

"We need to access cheaper ways of getting financial advice and literacy online ... look at the market going into a crisis, already people are talking about what they are currently invested in – it could be growth investors switching back to a conservative option. They're doing that without seeking the appropriate financial advice for their own needs. There should be better tools built around that sort of thing."

Economists say those investors may still have worse to navigate in coming months, but the action of governments around the world should eventually boost markets.

Westpac chief economist Dominick Stephens said Covid-19 would create a deep recession, including a drop of 3.1% in GDP compared to 2.7% in the GFC, but it should be briefer as long as the banks and Government stayed in good shape.

He said it was likely that the Reserve Bank would start quantitative easing this week.

ASB economist Jane Turner agreed quantitative easing might be needed "with some urgency" given a sharp increase in global government bond yields over the past week.