FSB4 Financial
At FSB4 Financial we consider KiwiSaver to be a “No Brainier” It needs to be the foundation of your overall retirement plan. Here are some quick and easy facts about KiwiSaver.
1.1 What is KiwiSaver?
KiwiSaver is a savings initiative to help set you up for your retirement. Most members will build up their savings through regular contributions from their pay.
Membership benefits include a $1,000 kick-start, regular contributions from your employer, plus an annual member tax credit paid by the Government. Some people may also be eligible for help with the deposit on their first home.
KiwiSaver schemes are managed by private sector companies called KiwiSaver providers. You can choose which KiwiSaver provider to invest your money with.
KiwiSaver is not guaranteed by the Government. This means you make your investment choices in a KiwiSaver scheme at your own risk. KiwiSaver is a Government initiative however the government actuary has an overview of all providers. The Governments Commerce commission are regulators. Each provider must also seek independent auditing through a Trustee Company.
1.2 Who can join?
KiwiSaver membership is voluntary.
Most New Zealanders under the age of 65 can join KiwiSaver.
You can join KiwiSaver if you are:
• a New Zealand citizen, or entitled to live in New Zealand indefinitely, and
• living or normally living in New Zealand (with some exceptions), and
• below the age of eligibility for NZ Super (currently 65).
It doesn’t matter whether you are:
• in a job
• working for yourself
• already retired
• in between employment
• already saving
• saving for a first home
• a student
• receive
• a stay at home spouse
• a full time parent
• or an employer
If you are under the age of 18: If you are under 18 years old, you can choose to opt in to KiwiSaver if your provider allows, or your parents can sign you up.
If you are between 60 to 65 years old:
If you are between 60 to 65 years old, If you join when you are between 60 and 65, you won’t be able to get your money out until you’ve been a KiwiSaver member for 5 years.
If you already have a retirement savings scheme
You can still join KiwiSaver even if you already save through another superannuation scheme, for example the State Services Retirement Scheme (SSRS).
You can not join KiwiSaver if you are:
- holding a temporary, visitor, work or student permit
- living overseas, unless you are a government employee:
- serving outside New Zealand, and
- employed on New Zealand terms and conditions, and
- serving in a jurisdiction where offers of KiwiSaver scheme membership are lawful.
1.3 How KiwiSaver stacks up for you
1.4 Your KiwiSaver benefits
- $1,000 kick start contribution from the government.
- The government will match your contributions up to $1,042.86 per year if you are aged 18 years or older.
- Your employer must contribute 2% tax free, of your gross salary or wages, if you are aged 18 years or older and contributing to KiwiSaver.
- You can withdraw your contributions, plus those from your employer, plus investment returns, to use as a deposit for your first home.
- A first home buyers’ grant of up to $5,000 to help you buy your first home.
- Parents are NOT required to contribute to their children’s KiwiSaver funds
- If you receive a salary, you can choose to contribute 2%, 4% or 8% of your salary, or take a contribution holiday after twelve months.
If you are not receiving a salary, you can decide the amount and frequency of payment that you wish to contribute to KiwiSaver, and pay by automatic credit or direct debit. For each dollar contributed by you the government will contribute 50 cents, up to a maximum government contribution of $521.43 per year.
