NZ Herald Q&A Column

Big bad government unlikely to spoil KiwiSaver. Every now and then, someone says to me, “The government must be paying you for all that favourable publicity about KiwiSaver”. It’s not, of course. And in any case, my coverage has been far from totally positive. As I’ve often said, KiwiSaver distorts savings decisions, because you can save only in certain types of vehicles. Also, the government — in other words the taxpayers — is paying many KiwiSaver members thousands of dollars to do saving they would do anyway. True, other members will save more because of KiwiSaver, but whether the whole thing is cost effective remains to be seen. The scheme is far from perfect, then. However, I can’t go along with some of the cynicism I’m hearing about how current or future governments might treat people who have signed up for KiwiSaver — with the speaker concluding that it’s not a good idea to join.

Ins and Outs of KiwiSaver tax credit. Judging by readers’ questions, confusion reigns about the government’s KiwiSaver tax credits, which match members’ contributions up to $20 a week or $1042.86 a year. The tax credits are paid to every contributing KiwiSaver member 18 and over until they reach NZ Super age (currently 65) or five years after joining, whichever is later. For example, if you join at age 63, you will continue to get the credits until five years later, when you are 68.

KiwiSaver bringing out the best in many. One aspect of KiwiSaver that I’m enjoying is the way people are helping one another understand it. This came through in several entries to our giveaway of my book “KiwiSaver: How to make it work for you.” Entrants had to say in 40 words or less why they should win one of 30 copies of the book. Some wanted it book to help their children, some their parents and some their workmates.