First home savers

Saving for a first home can be hard enough without putting money aside for retirement as well, but KiwiSaver was also designed to help Kiwis into their first home so it could be very worthwhile joining.

What are the first home buyer's benefits?

There are two major benefits offered for KiwiSavers who haven't bought their first home:

• Three years after your first contribution to KiwiSaver you can apply to withdraw any contributions you have made plus any employer contributions for use for your first home. So not only will contributions you have put into KiwiSaver be available for your first home, but any employer's contributions will also be available. Any of your and your employer contributions you don't withdraw for your first home will remain in your account for your retirement.
• At the same time you may also be eligible for a first home buyer's grant of $1,000 from the Government for each year that you've been in KiwiSaver (up to $5,000). Income and house price caps will apply.

The above benefits are also available to second-chance home buyers in certain circumstances. A second-chance home buyer is someone who is in the same financial position as a first home buyer and is certified as such by Housing New Zealand Corporation. This benefit does not apply to the purchase of leasehold properties. More information is available at www.hnzc.co.nz

What happens once I buy my first house?

If you withdraw any KiwiSaver contributions to help buy your first (or second-chance) home you will continue to be a KiwiSaver member. Any Government contribution and any amounts you transfer from an Australian complying superannuation scheme (if allowed) will remain in your KiwiSaver account and you can continue to contribute to KiwiSaver, which is likely to be worthwhile so you can continue to receive any employer and member tax credits. You will only be able to withdraw your KiwiSaver contributions once for a first (or second-chance) home deposit.

However if things are a little tight you can take a contributions holiday for between three months and five years until you feel comfortable with both your home loan repayments and making KiwiSaver contributions.