AMP general manager in New Zealand Blair Vernon said a key issue after 10 years of the KiwiSaver scheme was making sure New Zealanders got the advice they needed, across all aspects of their lives. They needed to recognise when they lacked skills and seek them from a professional.

“I’m fine with people DIYing but most aren’t, they’re just faking it til they make it and that’s an issue,” he said.

“My view on advice is that we need that way more regularly to save you from yourself. People make bad consumption decisions.

“What’s the point of getting into KiwiSaver and continuing to save but you have no insurance to manage the downside risk in your life? Advice needs to be a broader conversation than KiwiSaver. That’s why I worry that KiwiSaver is dominating the conversation.”

Vernon said there were not enough advisers in the market because financial advice was “not a charity business”.

Too many consumers expected to be able to get advice free, he said.  “We have to find a better way of having that conversation. People spend more on having their hair done than they do on financial advice.”

Claire Matthews, of Massey University, said financial advice was fundamental if New Zealanders were to have comfortable retirements.. “A lot of people start KiwiSaver and they aren’t even sure if they’re in the right fund... but there aren’t enough financial advisers out there. There’s no financial incentive to adviser to cater to that part of the market.”

She said that was a role for providers to pick up.

Ana-Marie Lockyer, general manager of wealth products at ANZ, said advice was important at key stages through KiwiSaver – when they joined, bought a first home, at 40, at 55 and at 65. “That’s when they need help most, to make it last.”

She said there was a tsunami approaching KiwiSaver as an ageing population had increasing demands for their retirement. “Let’s not wait until 50 to start saving for retirement. We need to help people start thinking about saving a little bit for longer.”

Vernon said a lot of the money that was in KiwiSaver had displaced other savings.

A widespread lack of contributions was down to the choices people made about where they spent their money, he said. “A lot of people have chosen not to participate and that’s really sad. They’re saying they don’t have an aspiration for the future... I ask if you’re not in KiwiSaver are you planning to die before 65 - because that’s a reasonable strategy.”

The “elephant in the room” was that people had an unrealistic view of what KiwiSaver should give them in retirement, he said.

“If we aren’t able to bridge that gap there’ll be a whole lot of people who purchase products and services from us and are really unhappy. That’s a huge problem in New Zealand and KiwiSaver is perpetuating it because people think 3% plus 3% equals happy days.”

READ MORE: Are KiwiSaver fees too high?