when the market drops and kiwisaver

I thought you maybe interested in this article that Generate KS published a while back. It gives a pretty good idea of why we don’t stop investing when the market drops.  

“One of the benefits of making regular contributions into your KiwiSaver account is that you get to take advantage of dollar cost averaging (DCA). DCA involves buying a fixed dollar amount of a particular investment on a regular schedule, regardless of the share price. As a result more shares or units are purchased when prices are low, and fewer are bought when prices are high.
DCA reduces the risk of investing in a single investment at the wrong time.
 
For example, you decide to purchase $1,000 worth of shares in company X for each of the next three months. In April, X is worth $30, so you by 33 shares. In May X is worth $25, so you buy 40 additional shares. Finally, in June, X is worth $20, so you buy 50 shares. In total you purchased 123 shares for an average price of approximately $24 each - a much better result that if you had invested the entire $3,000 at $30 a share.
 
As demonstrated above DCA can lower an investor's overall purchase price of a stock, as well as minimise the risks associated with market psychology - including market-timing and panic buying and selling.
 
A lot of KiwiSaver members were unaware they were buying shares at the height of the GFC - just like Warren Buffet was - and similarly those shares have - as a whole - turned out to be great investments.”

This blog is general information only. For specific advice in relation to your circumstances a Licensed Financial Adviser should be consulted​