Kete Pūtea: KiwiSaver (Poua he Oranga)
When it comes to saving, Ngāti Whātua Ōrākei whānau have powerful tools at our disposal. We can enrol in both our hapū Toi Tupu savings and investment scheme, as well as the New Zealand Government’s KiwiSaver scheme. Using the two together could give a clever saver a real head-start!
What is KiwiSaver?
KiwiSaver is a voluntary savings scheme set up by the New Zealand Government for Kiwis. Although created with the intention of helping people save for their retirement, the funds can also be withdrawn for certain life events such as buying your first whare, moving overseas, significant financial hardship and serious illness.
Here’s 6 reasons why you should sign up to KiwiSaver if you haven’t already:
- It’s a hassle free way to contribute towards your retirement fund
The minimum contribution for those who sign up to KiwiSaver is 3%, which is removed before your pay reaches your bank account. If you’re 30 years old and earning $40,000 a year, that’s about $23 a week. By the time you’re 65 you would have contributed $42,000, not including the interest earned, employer contributions and government contributions.
- Free money from the government
After all the tax you pay to the government, isn’t it good to get something back? The Government will contribute 50 cents for each dollar you contribute, to a maximum of $521.43. To receive the maximum you'll need to contribute at least $1,042.86.
- Free money from your employer.
It is compulsory for employers to contribute to their employees' KiwiSaver accounts. The compulsory (minimum) rate for employer contributions is currently 3% of the employee's gross salary or wages. If you’re not in KiwiSaver you miss out on the 3% from your employer.
- You can withdraw money from your KiwiSaver to go towards a deposit for your first home.
Purchasing a whare can be one of the most significant and expensive moments in life. If you’ve been a KiwiSaver member for over three years, you may be eligible to withdraw some, or all, of your savings to make a deposit on your whare.
- It can help you to improve your financial literacy.
We want our whānau to make their pūtea work for them, it’s one of the goals in our Ngāti Whātua Ōrākei 2050 Long Term Strategy. Most KiwiSaver fund providers have apps or online accounts showing the progress of your money which helps you to think differently about your finances.
- It will help you get back on your feet
If your circumstances change and you become unemployed, your KiwiSaver will continue to earn interest and you can resume contributions once you find new employment.
To learn more about KiwiSaver, click here and here.
To sign up, contact a KiwiSaver provider or have a chat to your employer. Sorted.com breaks down the different providers and funds to help you with the decision process.
Previous kōrero
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Or do you need a hand budgeting? You can find the first steps to creating a budget here. If you want to kick it up a notch, you can try creating your personal budget on the PAYE website by clicking here.
