BEVS

Does anyone have any thoughts or views on this new fangled Kiwi Saver Scheme just set up by the goverment? Is it a good idea or a bad idea. Have we seen it all before with the various UK schemes .

I wasnt going to give it a 2nd thought, but husbands firm are all talking about it at the mo. They are particularly attracted to the fact that the government will put in some $$$. I am not at all sure about this malarky. I was one that has had an assortment of pension plans and at the end of the day I suspect I may have got a better return simply by saving and investing myself.

karonious

I asked my colleagues what they thought. One of them said that your return isn't guaranteed as it is in some other schemes and that your money may well be invested in things that aren't neccesarily 'ethical' - rainforest was his example. Now, this particular chap has a radical opinion on just about everything so I am not saying these are my opinions, but something I have been told. I am also interested to see what other people think about this, so good topic to pick!

Apple13

Perhaps best to wait until after the General Election next year. If National get in then who would know what will happen, it will be all up in for grabs and the situation could easily change.
Also if you are working, perhaps best wait another year until the employers have to stump up a contribution.

bro69

Unfortunately it is not that easy to take a back seat and see as the government will always claim it is great.

The plus side is they have different companies dealing with your money so in most cases you can choose. There are much better schemes around but the plus is the government will put some money in and your employer will eventually match your 4% contribution, plus if you are not good at saving it forces you too.

The bad thing is once it starts you have between day 13 and day 55 to opt out, if you miss this date you are in so bad luck.

I'm not 100% sure about it myself will be interested to see what other people say.

Apple13

NZ has a long history of pension schemes being a political football. Labour have brought this policy in, and the latest deal in the last budget have made a difference to how people feel about it. But with the National Party promising tax cuts, and not putting forward their policy intentions yet, a change of Government to a National-led coalition could mean big changes to the Kiwisaver scheme in its current form.

At least at this time next year there should be a bit more information on where the different political parties stand with the lead up to the next general election.

Wiz'n'Ton

BEVS Here - great subject to bring up. Well done.

Guys and gals - this can only be a good thing - seriously!

Rules are:

1) From June 1st any new starts have to opt OUT and not in.

2) You opt OUT - then once you move to a new job, you have to opt out again.

3) Once you opt IN - you are IN until you are of pensionable age. Job done, that's it, no turning back. You access the money deducted when you get to pensionable age. The only time you don't is if you are in 'extraordinary financial suffering'

4) You have appx 5 weeks from starting a new job in which to opt OUT. If you don't then you are automatically opted IN - for life, or until you start a new job, or until you lodge an 'opt out appeal'.

5) From right now employers will commit to matching your input by $1 in $4 yr 1, $2 in $4 yr 2, $3 in $4 yr 3 and $4 in $4 yr 4, per year up to 4 years. After 4 yrs it is dollar for dollar. Therefore, you are getting an input from your employer for every dollar you earn. This can only be a good thing - FREE MONEY PEOPLE!

6) You have a choice of which Kiwisaver provider you use. You can have an agressive or benign saver scheme - it's up to you.

7) Finally - something that will encourage KIWI's to bloody SAVE! In the day of '$25/ wk plasma TV' and '$200/ month easy pay on your brand new leather suite' this is finally a way to get people to save for their future.

8) No - it's not guaranteed. Find me an investment scheme that is. But this is the best way this country is going to afford itself in 20 years time +.

Well done NZ - I give a big to KIWISAVER.

Gill and Rob

PLUS the $1000 the government put in for you after you have been in 3 months. You can always freeze the scheme after 1yr.

Rob

dicknlyn

er.... what about the self-employed?

Wiz'n'Ton

You know what? I've absolutely no idea, so that is a bloody good question. If I can be arsed I'll google for an answer.

Woodlea

Some employers are going straight for the 4$ in 4$ from year one, i.e. they match what you put in from the off, aren't they nice?

southerner

Set up a company, and pay yourself a salary:

a) you get to set the salary at a level that suits how much you want to save (but also how much you need for spending);

b) you can get the tax breaks that the Govt is offering employers for Kiwisaver;

c) the employer contribution to your savings scheme is just you paying money from one hand to the other;

d) you only initially get taxed at the 30% company tax rate, and can massage your tax on higher income a bit better;

e) and while you're at it, and if you can afford it, pay your partner a salary as well and get some more kiwisaver tax breaks.

Herm

Some employers are even beating that - if I go 8% mine will go 6% - even nicer

Yotty

http://www.stuff.co.nz/4362610a6009.html

pioneer7

My thoughts on this is total confusion on what to do! Either way when retirement beckons then it will be survive on NZ super which is little better than Unemployment Benefit is now. Not sure how much UK pension I have before we left the UK but thats going to be swallowed by the NZ Super anyways. Can also see us still working until I am 70 to just pay off the mortgage.

A chap I work with is 75 and had planned to retire from the school Bus runs he did. Yes I said 75 and he lost $50,000 when one of the Financial institutions collapsed.

I am confused with the whole thing, but then I was confused by the UK pensions as well.

Yotty

In the UK unless you've got a final salary scheme with your employer I recon it's best to save your money in an ISA. It's tax free and more importaintly no-one can take it away from you!