How does KiwiSaver work?
A KiwiSaver fund is more than just a savings account. It's similar to what we call a managed fund. Your fund manager invests your KiwiSaver savings on your behalf, which means your savings also earn returns over time.
Your KiwiSaver grows with:
- Your automatic contributions
- Employer contributions of close to 3% on top of your pay
- Government contributions (up to $521 every year!)
- Investment returns from all the contributions being invested for you by your KiwiSaver provider
- Any additional money you choose to put in. You can make voluntary contributions – lump sums or regular automatic payments – at any time, either directly to your KiwiSaver provider or through Inland Revenue.
If you’re 18 or over and start a new job you’ll be automatically enrolled in KiwiSaver (with some exceptions). And that’s typically a good thing!
You can use KiwiSaver to save for a first home
When buying your first home you may be able to make a one-off withdrawal of most of your KiwiSaver savings – as long as you’ve been a KiwiSaver member for at least three years. You also may even qualify if you have owned property previously.
The KiwiSaver calculator can help you find out how much you're on track to save for your first home.
In addition to a KiwiSaver savings withdrawal, there’s also the First Home Grant. If eligible, the government may also give you up to $5,000 towards buying an older, existing home, or up to $10,000 towards buying a new home or land to build a new home on.
Visit the Kāinga Ora website for more information.
You can use KiwiSaver to save for retirement
If using KiwiSaver to save for retirement, you can’t touch your money until the age you get New Zealand Superannuation (NZ Super) which is currently 65. Note that KiwiSaver is open to those over 65 to join as well.
Find out how much you're on track to save for your retirement using the KiwiSaver calculator.
KiwiSaver funds come in five basic types
We’ve grouped the hundreds of KiwiSaver funds into five types to make things easier. Once you find which is right for you, it’s much simpler to find a fund of that type.
Each fund holds a mix of investments, and which type they fit into is based on how much of the more risky stuff, like shares and commercial property, is in the mix. The more risk you take on, the more potential you have for better results, but your balance will have more ups and downs along the way.
Depending on how long you are investing for, and your attitude towards the ups and downs that can happen with investing, one type of fund will work particularly well for your situation.
Finding your fund type first makes it simpler to find the right fund for you.