When you join a KiwiSaver scheme your money is put into a portfolio of investments made up of different asset classes (e.g. shares, fixed interest, cash).
The provider’s investment manager decides which shares, fixed interest and cash to invest your money in. It is still your money though – it doesn’t belong to the company who is investing it for you.
The value of your KiwiSaver account will go up or down depending on what happens to the value of the investments in your portfolio. So, for example, if your portfolio invests in shares and these go up in value, you may see your overall balance increase.
However, if the value of your investments goes down, you may see your overall balance decrease but you won’t have to fork out cash.
The worst case scenario is that everything in your portfolio has an awful day, the world implodes, and the value of your account goes to $0. That is the worst case – you will not end up writing a cheque out to cover losses.