Financial Advice New Zealand (FINANZ) has highlighted the importance of financial wellbeing following the release of the 2019 Budget.
Dubbed the ‘Wellbeing Budget’, the government has announced increased spending on family wellbeing, mental health services and lifting Māori and Pacific incomes and opportunities, as well as increasing funding for KiwiRail and vocational education reforms.
According to FINANZ CEO Katrina Shanks, there is a clear link between wellbeing and financial confidence and capability.
“To help New Zealanders build a successful future, access to quality advice and confident use of tools such as KiwiSaver is essential,” Shanks said.
“68% of New Zealanders have money worries and 44% could access only one month or less of income from savings and other means,” she continued. “That’s two of the many very concerning statistics that access to quality financial advice can greatly aid in improving.”
Shanks says that 20% of KiwiSaver members are still on a default scheme, and are unaware of their options or which fund is right for their needs. She says members should also be able to choose their own levels of contribution, and that they should be excluded from AML regulatory requirements.
“Currently the minimum contribution of 3% is prohibitive for Kiwis on low incomes; and the maximum of 10% is limiting for those who may want to fast track their savings,” Shanks said.
“Common sense indicates that the level of risk of money laundering and terrorism activity through a KiwiSaver plan is low, and as such the AML requirements for this group of Kiwis is an unnecessary barrier to participation.”
“We believe the Government should provide assistance for existing and new KiwiSaver participants to access financial advice through the workplace or through an approved financial adviser register. This will give more Kiwis the ability to assess the schemes and what is best for their needs,” Shanks concluded.