KiwiSaver schemes
The choice is yours
You can apply to join the scheme of your choice, even if you're being automatically enrolled or you've been allocated to one.
You can choose your own KiwiSaver scheme or change schemes at any time by contacting a scheme provider directly. If you choose your own scheme within the first three months of starting your new job, this will mean that your contributions will go directly to your chosen scheme, and not to your allocated default scheme.
Default KiwiSaver scheme providers
Six financial organisations have been appointed by the Government to be default scheme providers through a tender process managed by the Ministry of Economic Development. The default providers are:
- AMP Services (NZ) Limited
- ASB Group Investments Limited
- AXA New Zealand (National Mutual Corporate Superannuation Services Limited)
- ING (NZ) Limited
- Mercer Human Resource Consulting Limited
- Tower Employee Benefits Limited.
Changing schemes later on
You can change schemes at any time, but you can only belong to one KiwiSaver scheme at a time.
If you want to change your scheme, you must apply to the provider of the new scheme you want to join. When the change is complete, your savings will be transferred to the new scheme provider and you'll be notified of the transfer.
You may be charged a transfer fee by your old scheme provider.
You can get a list of scheme providers on this site.
How do the KiwiSaver schemes work?
Your contributions are invested for you by your scheme provider in a registered KiwiSaver scheme. Your scheme provider's investment statement:
- sets out the specific rules, fees, terms and conditions of the scheme
- explains how your money will be invested, and
- tells you what returns you can expect.
Your scheme provider will also let you know how your investment is doing.
Where do you get your investment statement?
| If your scheme is ... | you get your investment statement from ... |
|---|---|
|
a default scheme |
us. |
|
your employer's chosen scheme |
your employer. |
|
one you applied to directly |
your scheme provider. |
Note:
Please make sure that you read the investment statement - it's an important document. You might also benefit from independent financial advice.
What choice of schemes is there?
There's a range of scheme providers and several investment types, from conservative risk to growth funds.
Important:
There's no government guarantee on your KiwiSaver account. Schemes will have different levels of risk, so you can choose your scheme provider, the type of investment strategy and the level of risk you're prepared to take.
Higher risk funds will potentially produce higher returns over the long term than low risk funds, but with a higher investment risk (the likelihood of fluctuating returns and the potential for a negative return).
What are the fund types?
| Fund type | What does this fund generally invest in? | Investment risk level |
|---|---|---|
|
Cash |
Bank deposits and other fixed interest investments |
Low |
|
Conservative |
A high proportion in bank deposits and fixed interest investments, and a lower proportion in growth assets such as shares and property |
Low to medium |
|
Balanced |
A more equal split between higher risk growth assets such as shares and property, and more stable investments including fixed interest and bank deposits |
Medium |
|
Growth |
A high proportion of shares and property with a lower level of bank deposits and fixed interest |
Medium to high |
|
Aggressive |
Mainly shares |
High |
We have a list of organisations that offer registered KiwiSaver schemes. You can also visit the Retirement Commission's Sorted website for more information about funds, schemes, investment types and fees.
Note:
The default schemes are all conservative funds.
Does investing in a KiwiSaver scheme cost you anything?
All KiwiSaver schemes will charge you fees. The scheme's investment statement will set out what fees they charge.
To help offset the fees, the Government will pay a subsidy of $20 into your KiwiSaver account every six months ($40 a year).
| If the fees charged are ... | then ... |
|---|---|
|
less than the subsidy |
the difference will stay in your account and be invested along with your contributions. |
|
more than the subsidy |
your scheme provider will take the difference out of your KiwiSaver account. |
Who decides the fees?
| If your scheme is ... | then the fees are ... |
|---|---|
|
a default scheme |
negotiated by the Government and prescribed for each provider in their Instrument of Appointment. |
|
set by the scheme provider - although the KiwiSaver Act prevents them from charging "unreasonable fees". |
Note:
The Government Actuary, who regulates KiwiSaver schemes, is responsible for:
- determining what constitutes "unreasonable fees"
- the ongoing monitoring of fees.
Responsible investing
From 1 April 2008 scheme providers will need to disclose their approach to responsible investing including their environmental, social and governance considerations. Your scheme provider's investment statement will outline this information.
Is your KiwiSaver investment income taxable?
Your investment earnings are taxed. This tax will be deducted from your investment earnings by your scheme provider, as per your scheme's investment statement. Your scheme provider then pays the tax to us on your behalf.
A scheme can be either a:
- "widely-held superannuation fund", or a
- "portfolio investment entity" (PIE).
Your investment statement will tell you what type of scheme you have. The scheme types have different tax rates on their investment earnings.
If your scheme is a widely-held superannuation fund then the tax on your investment earnings will be 30%.
Portfolio investment entities (PIEs)
The tax rate for your investment earnings from a PIE is referred to as your "prescribed investor rate" (PIR). Your scheme provider will ask you for your PIR every year.
All of the KiwiSaver default schemes are portfolio investment entities (PIEs).
| If in the last two years your taxable income was $38,000 or less, and when combined with the income from your PIE investments in those years ... | then the tax on your investment earnings will be at ... |
|---|---|
|
the total for either income year was $60,000 or less |
19.5%. |
|
the total in both income years was greater than $60,000 |
30%. |
If in the last two income years your taxable income was greater than $38,000 in both of those years, then the tax on your investment earnings will be at 30%.
Note:
Any withdrawals from your KiwiSaver account are tax-free.
Forms and guides
Check out what KiwiSaver forms and guides are available.
Date published: 15 Apr 2008
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