Changing KiwiSaver is a simple process that can be done by contacting your newly chosen provider. Transferring KiwiSaver requires you to fill out a form to switch KiwiSaver and your new provider will take care of the rest. You can apply directly with the new provider or we can do it on your behalf if you've chosen us as your advisor. The new provider will then organise the transfer of funds as you change KiwiSaver schemes.
So let’s say you’ve gone through our KiwiSaver HealthCheck. Our team at National Capital have analysed your situation and recommended a KiwiSaver provider for you. And you’re happy to take our advice on board by changing KiwiSaver schemes.
But you’re wondering how much hassle this process to switch KiwiSaver might take. Additionally, you’re concerned changing KiwiSaver providers will be a lengthy process, and will take hours to do.
In that case, I’ve got some great news for you. The thing you should know about switching KiwiSaver schemes is that...
One may think that to change KiwiSaver schemes, you must fill out tons of pages of paperwork.
In that case, I’ve got some great news for you! This isn’t the case when changing KiwiSaver companies.
Instead, the process of transferring KiwiSaver accounts is quite simple. When I decided to change KiwiSaver provider last year, it took me only about 20 minutes to do so.
Most KiwiSaver providers allow you to complete this process online. All you have to do is fill out a form with your name, your IRD number, and a few other things, and you’ll be good to go! The process to change KiwiSaver will only take a few minutes for you to action.
Your new KiwiSaver provider will then do a lot of, if not all, the rest. And you can relax, knowing your money will be transferred to your new scheme.
There are some misconceptions regarding what you need to do to switch KiwiSaver schemes to another. For example, you don’t need to call your current provider and tell them why you’re switching KiwiSaver while a salesperson tries to convince you to stay.
I understand how that feels because I originally used to think this. To my relief, when I decided to change KiwiSaver providers, I never received any awkward phone calls or messages from my old provider asking me to stay with them.
There is one “awkward” thing to keep in mind. A few providers charge “transfer fees”. This means you pay your old provider a fee to leave their scheme, for things such as administration costs.
Although most do not charge transfer fees, you should check with your provider to see if they charge them. Other than that, there is no other obvious reason to talk to your old provider before transferring KiwiSaver balances.
These are all important things to have on hand because it is likely you will need them for your change KiwiSaver application form. The reason you give your new provider these details is so they have the information they need to verify who you are and complete the transferring KiwiSaver process.
Below is a description of what you need to know about these four things:
PIR (Prescribed Investor Rate): Your prescribed investor rate is the amount at which your investment returns will be taxed. You should put in some effort to make sure you are getting taxed at the correct rate. If you pay too little in tax for example, the IRD may contact you to give you a tax bill.
To help you find your PIR, National Capital has developed a PIR calculator you can use.
Dig Deeper: KiwiSaver Tax - Everything you need to know
IRD Number: Your IRD number is an eight or nine-digit number that helps to keep track of the amount of tax you’ve paid, and how much you need to pay. Your IRD number is unique to you and you keep it for life and a must-have when changing KiwiSaver companies.
If you do not know your IRD number, you can check the following places for it:
Your KiwiSaver statement from your previous provider
Your payslip
Log into your myIR Secure Online Services account
Check any letters or statements from Inland Revenue
If you still cannot find it, you should call Inland Revenue. Click here for more information about their contact details. You can't switch KiwiSaver without providing your IRD number in your application.
Also, make sure you have your ID as well as address on you just in case you need it.
Sometime during the process of transferring KiwiSaver, you'll need to decide which fund(s) you want to be invested in.
This is an important part of the switching KiwiSaver process because being in the wrong fund can cost you a lot of money over your lifetime. Many New Zealanders are making the mistake of being in the wrong fund, costing them lots of money. Therefore, it’s important you take some time to decide where to invest your money.
If this is a step you’re struggling with, we recommend you complete our KiwiSaver HealthCheck. It can provide important tips that help prior to switching KiwiSaver. After filling out an easy-to-fill form, you can get information about what type of fund is best for you, as well as which provider is best suited for you.
This advice is given over the phone, which means you get the opportunity to clarify any questions you may have about our advice. And the advisory service to switch KiwiSaver is free.
Most forms are online, simple and easy to fill out, provided you have prepared in advance.
To find what you need to fill out, go to the website of your new KiwiSaver scheme for more information. These forms can be usually filled out on your computer.
Take your time to complete the application form, following the instructions of the new KiwiSaver provider, and make sure everything is correct to ensure there are no delays in the transferring KiwiSaver process.
Your new provider may ask for a few other things once you’ve submitted your application form. For example, when switching KiwiSaver last year, my new provider asked for proof of address. Be prepared for this to occur.
After submitting a request to change KiwiSaver companies, it usually takes up to 35 days for the switch to be fully completed. However, it doesn’t usually take this long at all.
When I decided to switch KiwiSaver schemes last year, it took me just two weeks to have my funds transferred.
Sometimes your KiwiSaver funds won’t come into your account all at once. However, rest assured that your money will be transferred in full and thus completing the transferring KiwiSaver process. You can normally check progress through your KiwiSaver Login.
The most common reason for changing KiwiSaver services is often performance related. National Capital tracks the latest market insights to establish a list of the best performing KiwiSaver funds. Some people will change KiwiSaver firms depending on the best performer in the fund they’re interested in. We recommend speaking with us and getting free advice to check if your goals and circumstances align with the decision.
Although we don’t typically recommend switching KiwiSaver based on fees, it can often be a deciding factor. There has been a downward trend in fees these last few years, however, there are still clear differences. We have discussed the topic and tracked the cheapest KiwiSaver providers for you.
Others may take an active decision to change KiwiSaver from a default provider. Oftentimes, a default option means that you haven’t really taken an active approach toward investing in your future. Thus people may decide to switch Kiwisaver once they are ready.
Some may change KiwiSaver to one that aligns with their personal financial goals. One particular scheme may offer the best returns in a fund that aligns with your short-term goals. Alternatively, another can be the best fit for your long-term goals.
Most providers are placing an increased focus on ethical investing and avoiding assets in arms trading and human rights violations. Ethics and beliefs are other defining factors for people transferring KiwiSaver between companies. For example, the Christian KiwiSaver Scheme is designed for NZ’s Christian community and aims to invest according to their beliefs.
You need better service and communication. Non-bank funds continue to outrank bank funds on consumer satisfaction with Simplicity, Milford and Generate taking the top spots. Milford in particular stands out with an 82% score on access to account information and 80% on investment updates. Thus you may change KiwiSaver as you’ll feel more comfortable being kept in the loop effectively about your investment.
The good thing is that you can switch KiwiSaver firms as many times as you’d like and at any time. Some scheme providers may charge a fee to switch KiwiSaver. Naturally, it’s important you make an informed decision with your goals in mind.