Retirement

Retiring with your KiwiSaver savings will bring some important decisions about the best way to use your KiwiSaver savings. Find out more below.

• When can I get my money out?
• Retiring with your KiwiSaver savings

When can I get my money out?

The rules for withdrawing KiwiSaver retirement savings are that you can withdraw your savings at the later of:

• When you become eligible for New Zealand Superannuation, currently age 65.
• After five years of saving with KiwiSaver. This means that if you join after age 60 you will need to stay a member of KiwiSaver for five years before you can apply to withdraw your retirement savings. Membership of a complying superannuation fund may count towards the five years.

Retiring with your KiwiSaver savings

What you do with your KiwiSaver savings when it comes time to withdraw them will depend on your own individual situation. You may want to obtain some financial advice at this point to help you with your decisions and the ASB team will be here to help you. Remember also, you dont have to withdraw your money from KiwiSaver as soon as you become eligible to. You can leave it invested with any positive returns continuing to add to your savings, until you are ready to withdraw your savings.

Some of the options you will have when you withdraw your money from KiwiSaver will be to:

• Invest your money to provide you with an income.
• Invest your money but do not withdraw the returns on your investment. Any positive returns will then increase your savings so you have funds available when you need a lump sum for things such as house repairs, a new car or health expenses.
• Estimate how long you expect to need an income in retirement for and allow yourself to withdraw a proportion of your savings each year. For example, if you have $50,000 saved and expect to live for 20 years, you could withdraw $2,500 each year for those 20 years, plus any returns that your savings earn each year. You may want to withdraw less initially to offset increasing costs over time and the smaller returns earned each year as your lump sum reduces.
• A combination of any of the above options.

It is important to remember that inflation may decrease the purchasing power of your income and principal over time. Therefore, whichever option you choose, you will need to consider the importance of diversifying your investments into:

• Income assets - cash and fixed interest investments (such as bank deposits and government bonds) are lower risk investment types that primarily generate an income.
• Growth assets - shares and property investments are higher risk investment types that have the potential over time to increase in capital value and deliver higher returns to investors, therefore helping to offset the impact of inflation on your savings.

We recommend that you obtain financial advice on your options. You can talk to the ASB team at any time about what option will suit you best. ASB Wealth Manager's disclosure statements are available on request free of charge from your ASB Wealth Manager.