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Contributing to KiwiSaver if you are unemployed

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Many businesses are facing tough times at the moment and may need to make hard decisions around staffing. This may result in some Kiwis being at risk of losing their jobs and facing unemployment. Your retirement savings in KiwiSaver perhaps isn’t the first thing that comes to mind when you are at risk of losing your job, but it may be worth considering your options.

Withdrawing funds for financial difficulty

Due to COVID-19 and its impact, some people might need or want to withdraw their savings from KiwiSaver during this stressful time. Before making a decision to withdraw your funds you should always explore other options, such as reducing your contribution rate or applying for KiwiSaver’s savings suspension.

Taking a break from contributing to KiwiSaver may be a good option for Kiwis who are experiencing or are expecting to experience a financial hardship. On a savings suspension, the automatic deductions of your income will be temporarily stopped.

Losing KiwiSaver benefits with unemployment

If you stop earning a salary or wage or stop your contributions to KiwiSaver, the contributions from your employer will also stop. Without any more contributions to your KiwiSaver account, you might not be eligible to receive the annual government contribution. Remember, the government will contribute 50c for every dollar you save in KiwiSaver up to a maximum of $521.43 a year. 

KiwiSaver is set up to take deductions from your pay, but you can also directly put your savings into KiwiSaver through your provider. So, if you can afford it, you may still want to make voluntary contributions to receive this benefit from the government. You can choose to regularly invest at least $20 a week into KiwiSaver, which could already get you $520 in government contributions annually.

Assistance from our government and your bank

Our government is helping those who are affected by COVID-19 and may be able to help you with your essential living costs and business who are also affected. You may be eligible to receive financial support from the government whether you are unable to work, have lost your job, or if your work hours have been reduced.

If you are experiencing financial difficulties and have a mortgage or any other loans, you may talk to your bank on the available options they have for you. This might be reducing your repayment amounts or even a mortgage holiday.

How we can help

While missing out on the benefits of KiwiSaver is not something that anyone would want, we understand that it might be necessary when you are experiencing or expect to experience financial difficulties. You should explore different options that may help you during this uncertain time and to analyse those options to make an informed decision.

At National Capital, our Authorised Financial Advisers can help you sort out your personal KiwiSaver investing strategy and determine what option is better for you. We need to understand your situation better, your investment timeframe, your financial goals, etc. First step is to submit our KiwiSaver HealthCheck, then one of our advisers will get in touch to discuss with you further to help you structure a KiwiSaver plan tailored to you. All of this at no cost to you.

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Let's explore your options to find the one that's most suitable for your situation. Submit our KiwiSaver HealthCheck to have more confidence in your KiwiSaver decisions.
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