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Updates to your KiwiSaver

Updated: Sep 10, 2019

From 1 April 2019, the New Zealand Government have introduced changes to KiwiSaver which offer greater flexibility to tailor your KiwiSaver account to suit your needs.

Here’s what you need to know and how this can work for you:

From 1 April 2019


  • New rates

Two new contribution rates have been added for members, 6% and 10%. Members now have five contribution options to choose from - 3%, 4%, 6%, 8% & 10%.


How can it work for you: Time to review your current contribution rate? Are you stuck on the default 3% and never considered other options? Have your circumstances changed? Wanting to save more for your first home? Could you be saving that little bit extra for retirement? Consider your contribution rate and make it work for you and your goals.


  • Contribution ‘Holiday’

Let’s face it, it’s not a holiday so why call it one. The contributions Holiday will now be known as Savings Suspension. The Contributions Holiday allowed members to temporarily suspend contributions to their KiwiSaver account for a specific period of time. Under the Savings Suspension, members can still elect to suspend contributions as required, but going forward this will be limited to a maximum period of one year, before you need to renew it.


How can it work for you: Essentially this is just a name change but we need to change the way we think of it too. We need to think of this as a suspension of our savings, rather than a relaxing holiday. By introducing a maximum suspension period, this also ensures that members are reviewing KiwiSaver accounts regularly and making the most of their saving years.


  • Government Contribution

Until now the annual contribution made by the Government has been known as the ‘Member Tax Credit (MTC)’. This will now be known as the ‘Government Contribution’.


How can it work for you: The change of name does not impact your KiwiSaver account. If you are eligible to receive the Government Contribution, then this will continue as normal. Make sure you are making the most of the KiwiSaver benefits by checking your current contribution amount to ensure you are eligible to receive the annual Government Contribution of up to $521.43 per year.


What’s coming up?

From 1 July 2019


  • Opening the doors…

From 1 July, KiwiSaver will be open to all ages – people 65 and over will now be eligible to join KiwiSaver. Now’s your chance to enroll in your desired KiwiSaver scheme. This can be included as part of your overall retirement planning or just a back up for a rainy day.


  • …and throwing away the key

Current KiwiSaver rules state that a member who enrolls in KiwiSaver between the ages of 60 to 64 (inclusive) are locked in to their KiwiSaver scheme for five years.

From 1 July, new members will no longer be locked in to the scheme and able to withdraw their KiwiSaver funds at age 65.



From 1 April 2020

KiwiSaver members who are impacted by the 5-year lock in period (i.e. a member who enrolled before 1 July 2019, and aged between 60 and 64 inclusive when they enrolled) can elect to opt out of the lock in period any time after they reach the age of eligibility for NZ Super.

Remember, if you choose to opt out you will no longer be eligible for compulsory employer contributions or the government contribution. Please consider this when making your decision.



For further information on KiwiSaver and how these changes may affect you, head to the KiwiSaver website, or get in touch with an adviser from First Capital to discuss.

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