KiwiSaver is easy to join, and keeps ticking along in the background. But to make the most of investing our savings, we need to make some important decisions along the way.
The first thing to know in KiwiSaver which provider you’re with. There are a number of private KiwiSaver companies, like big banks or smaller niche players, who manage the schemes.
Not sure who yours is? It's not hard to find out.
Contact Inland Revenue and if you’re a member, they will have your details on file. Call 0800 KIWISAVER or log in to My KiwiSaver to find out your provider.
Your KiwiSaver provider will send you regular statements and can tell you your overall KiwiSaver account balance, the return on your investment, and details of any contributions paid directly to them.
In addition, you can keep track of the KiwiSaver contributions that you (and your employer) have paid to Inland Revenue by registering for My KiwiSaver on the Inland Revenue KiwiSaver website.
If your contact details change, let your KiwiSaver provider know. Here is a list of KiwiSaver providers and how to contact them. And here’s more from the Financial Markets Authority on how to stay informed about providers.
You can contribute 3%, 4%, 6%, 8%, or 10% of your before-tax pay to KiwiSaver. The difference in the balance between contributing 3% versus 10% over a lifetime of working can be huge. Use our KiwiSaver savings calculator to find out.
You can change your contribution rate by contacting:
The KiwiSaver website has more about changing contribution rates.
You can make voluntary contributions (lump sums or regular automatic payments) into your KiwiSaver account at any time, either directly to your KiwiSaver provider or through Inland Revenue.
To get the full ‘member tax credit’ of $521 each year you’ll need to have made an annual contribution of at least $1,043 by mid June.
There’s more about making voluntary contributions on the KiwiSaver website.
It’s easy to change funds in KiwiSaver, but it’s not always wise. Before switching, and to learn more beforehand, compare fund performance, fees and the services offered by providers using the KiwiSaver fund finder. Your reasons for changing KiwiSaver funds should be based upon building your long-term balance.
For more help finding the right KiwiSaver scheme, get advice from an independent, authorised financial adviser.
If it turns out to be difficult to keep up your own contributions to KiwiSaver, there are several options:
You can stop contributing to KiwiSaver for between three months and five years. This is called taking a ‘contributions holiday’.
You can renew a contributions holiday at any time, and there's no limit to the number of times you can take one. You can also stop a contributions holiday at any time and restart KiwiSaver contributions.
Find more information, including how to apply for a contributions holiday, on the KiwiSaver website.
If you suffer, or are likely to suffer, financial hardship before you have been in KiwiSaver for 12 months and have evidence for it, you may be eligible for an early contributions holiday. This is usually for three months, although Inland Revenue may agree to a longer period.
If you suffer, or are likely to suffer, significant financial hardship, you may be able to withdraw some of your KiwiSaver savings. Find out more about early withdrawal on the KiwiSaver website.
A contributions holiday gives you a break from making regular payments through your salary. But you can still make voluntary contributions or lump sum payments at any time, either directly to Inland Revenue, or directly to your provider.
And if your contributions total $1,043 for the year by mid June, you will still benefit from the maximum annual ‘member tax credit’.
Find out more about making voluntary contributions on the KiwiSaver website.
If you’re self-employed or not working you aren’t required to contribute a fixed percentage of our income. So if you need to take a break from contributing it could be as easy as temporarily suspending your direct debit or automatic payment or withholding any lump sum payments.
Employees currently contributing at a higher rate (e.g. 4%) can reduce contributions to the minimum 3% of gross pay. Likewise you can increase your contribution rate if you wish to save more.
Changing you contribution rate is easy. All you need to do is notify your employer in writing of the change, or complete a new KS2 form (which you can get from your employer).
There’s more about changing contribution rate on the KiwiSaver website.
After you reach 65, you become eligible to take all or some of your contributions, your employer’s contributions, the government's contributions, plus returns. In short, the whole thing.
How fast you open the tap is up to you: keep it off for now and leave your money invested in KiwiSaver, open it slightly to drip-feed some income, or open it right up to spend or invest the entire amount (although you may not be able to rejoin KiwiSaver if you draw it down entirely).
There’s no rush – you can leave your money where it is while you work through all the issues and decide. For example, if you want to make regular withdrawals, there may be a minimum amount required or some fees.
It may be worth talking with an Authorised Financial Adviser about your financial needs and risks, and work out the best course of action to reach your goals.
You can still keep your KiwiSaver account open and growing. Your employer can choose to keep contributing, although they don’t have to. The government will no longer pay its contribution though, since you're typically eligible for NZ Super.