All New Zealanders will now be able to access KiwiSaver regardless of their age, a change welcomed by leading financial institution ASB.
Previously, the KiwiSaver scheme had only been available to those under 65. With the government’s policy for over 65-year-olds coming into force from July 1, everyone will have access, and the five year lock in period which used to impact people joining over 60 will also no longer apply, meaning all members are eligible to withdraw KiwiSaver once they hit 65.
“It’s fantastic to see KiwiSaver being opened up to more New Zealanders,” ASB KiwiSaver head Aidan Vince said. “The decision to join might not have made sense for many when KiwiSaver was younger, but thousands of New Zealanders in this age group have, and continue to, benefit from KiwiSaver.”
ASB mentioned a recent household labour force survey from Statistics New Zealand, which revealed about one in four New Zealanders over 65 are employed, or 170,000 people. Vince suggests this fits a recent research by ASB, which shows 51% of respondents planned to retire between 65 and 69-years-old. A further 18% planned to retire between 70 and 74-years-old and 6% said they planned to retire later than 75-years-old.
The bank also cited data from Statistics New Zealand, which shows that average life expectancy is increasing, meaning retirement savings need to last longer.
While employers are not obligated to contribute to KiwiSaver for those over 65-years-old, Vince said this should be encouraged so those over 65 could still get the more traditional savings benefits from being in the scheme.
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“Term deposit rates are low and expected to stay low, therefore If you aren't generating the income you want to live off with money in the bank, KiwiSaver is another option, so it’s good to see this available to more people,” Vince added. “As always though, we encourage people to get guidance and advice or use some of the online tools available to figure out what is the best investment strategy for them to achieve their goals.”