Super Plan

NZ Post Superannuation Plan

COVID-19 and your super

The price of shares around the world fell significantly in February and March as investors assessed the impact of the spread of COVID-19. Markets continue to be volatile and this has impacted the Super Plan. The Short Term Fund only invests in cash. Returns for this fund are holding steady. However, returns for the Medium Term Fund and Long Term Fund were sharply negative for February and March before recovering somewhat in the June quarter. 

What should you do when markets are volatile?

We cannot give individual financial advice. However, we can provide some general thoughts that might help you assess your situation. Unfortunately, all investment involves an element of risk, and none of us knows what is around the corner. We recommend you think about your investment strategy based on your personal circumstances and needs – especially when you expect to access your savings.

One side of the coin

Markets tend to recover – eventually. The Medium Term Fund and Long Term Fund have provided very good returns in the past, and we have every reason to believe they will do so again. However, you need to remain in the Plan long enough for that to happen. If you decide to switch to the Short Term Fund, you will lock in your current losses and miss out on any recovery. 

The other side of the coin

If you need to access your money in the near future, you might not want to risk further losses by remaining invested in the Medium Term Fund or the Long Term Fund. In this case, you might want to switch to the more conservative Short Term Fund. While you may lock in some of the recent losses, you will protect against further losses in future if global economic conditions continue to be uncertain.

Doing nothing is OK

Think carefully before making a change. When markets fall sharply as they have now, it is natural to want to take action. It’s OK to leave your money invested where it is if you’re comfortable that’s the right place to be given your investment timeframe.

If you do want to change your investment strategy, you can do so online or by filling in and returning a Change of investment form – download one here. If you do make a change, remember that it won’t take effect until the first of the month after we receive your completed form/online change.