KiwiSaver Retirement Savings Scheme
KiwiSaver is a voluntary savings program to encourage saving and future planning in preparation for eventual retirement. You can decide upon signing up what percentage of your income you will put towards your retirement goals. The options are 3%, 4%, 6%, 8%, or 10% of your gross salary (your total remuneration before tax).
When you select any of these options and set up your KiwiSaver, your employer is obligated to contribute to your KiwiSaver fund as well, with at least 3% of your gross salary. Some employers offer to match your personal savings with an equal contribution, effectively doubling your savings power. As long as you are working, your employer contributions are deducted from your salary before you receive salary payments, lowering your tax bill and making it easier to save.
Additionally, assuming you are aged 18 or over, the government contributes to your KiwiSaver fund once annually. This contribution can be up to $521. You can access some of your KiwiSaver savings early if you are buying your first home. You may also be able to agree to access your KiwiSaver savings early if you are experiencing significant financial hardship.
Eligibility for KiwiSaver
Registration
KiwiSaver Suppliers
Under 18 Years Old
If you are under 18, but already working, your employer cannot register a KiwiSaver account for you. However, you can still choose to set one up by registering directly with a KiwiSaver supplier. If you are aged 16-18, you will need at least one parent (or legal guardian) to co-sign your paperwork. Those under the age of 16 cannot register themselves, and require parental consent (this can be from a legal guardian) to sign up with KiwiSaver. For more information about Kiwisaver: sorted.org.nz/guides/kiwisaver/kiwisaver-how-it-works
New Zealand citizens and permanent residents are eligible to set up a KiwiSaver fund, if they are living normally in New Zealand. KiwiSaver is not open to those with temporary visitation, work or study visas. It is not necessary to be working to set up a KiwiSaver account, but you do still need to make regular contributions. Hence, if you already have some savings, it may be worth feeding some of them into a KiwiSaver fund in order to take advantage of government and employer offers to match your deposits.
There are three ways to open your KiwiSaver:
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Through your employer when you start a new job
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Through your employer if you decide later
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Through a KiwiSaver supplier directly
If you are self-employed, under-employed, or out of work, you can register directly with a KiwiSaver provider and agree on a regular contribution that is right for you.
When you put money into your KiwiSaver account, your savings are managed by a supplier (normally a bank or a financial investment company) of your choice. If you prefer not to choose an administrator yourself, the Inland Revenue Department (IRD) will assign one for you. If you change jobs, your savings will not be lost, and your KiwiSaver supplier will update your account to reflect any changes in your employment situation.
