Question:

My partner and I joined our 10-year-old daughters to KiwiSaver some 18 months ago. Since then we've left their accounts well alone, which seemed to be your advice, as without the tax credit that adults get it was better to pay off our mortgage sooner.

Now, though, with the National Government removing the $40 a year subsidy on fees, we're wondering what to do. Won't the annual fees slowly erode the asset, especially in times of negative growth?

Answer:

Mary Holm: Yes, they will. Over the long haul, though, there will probably be enough years of strong returns for your daughters' accounts to grow.

At worst, their $1000 kick-starts will decrease before they turn 18. But it's extremely unlikely they would end up lower than, say, $700 or $800. That's still $700 or $800 - and quite possibly much more - that the girls wouldn't otherwise have had.

What's more, being in KiwiSaver might get your daughters started on developing strong savings habits when they get their first part-time or full-time jobs. They might learn a bit about how markets work. And they'll be lined up to get KiwiSaver help with buying their first homes.

It's still a great idea to combine kids and KiwiSaver. And once they turn 18, and are eligible for tax credits, it's good to help them contribute up to $1043 a year so they receive those tax credits.

By the way, for those who complain that I cover KiwiSaver too much, it's been 11 weeks since the headline Q&A in this column was about the scheme. Defensive? Well, yes. Mindful of your criticisms, I might have erred too much the other way - given that there's barely a New Zealander under 65 who wouldn't benefit from being in KiwiSaver.

Mary Holm is the author of bestselling books on KiwiSaver and personal finance. She is also a highly praised seminar presenter. Her written advice is of a general nature, and she is not responsible for any loss that any reader may suffer from following that advice.