People who join a scheme before heading overseas, such as to Germany, can make voluntary contributions to build up their funds. Photo / Megan Stunzner
I am a New Zealand permanent resident, and I worked in New Zealand for almost six years but when I moved to Germany at that time I decided to take my private fund from AXA superannuation.
I have a question about KiwiSaver.
Is it possible to enrol if I am working overseas?
I am living and working in Germany but I am planning to return to New Zealand in the future.
With so many New Zealanders living overseas - estimates range from 600,000 up to one million - it's a good question to ask.
While many in the Kiwi expat community will have made a permanent move, there will also be a number with plans to come back to New Zealand at some point in the future.
Michael Raynes, head of marketing and communications at Fisher Funds, explains what the KiwiSaver rules are for those Kiwis living in other countries.
"It's great to see you're already exploring your options ahead of your return from overseas," Raynes says.
"Unfortunately, you cannot join a KiwiSaver scheme when you are not living in New Zealand.
"To be eligible to join a KiwiSaver scheme you must be:
• Normally living in New Zealand.
• A New Zealand citizen (or entitled to live here permanently).
• Under the New Zealand Superannuation qualification age (currently 65) unless you are transferring from another KiwiSaver scheme.
"So for now all you can do is focus your energies on researching the KiwiSaver provider that is best for you so when you arrive back in New Zealand you are ready to go," Raynes says.
If you do want to research your options ahead of coming back to New Zealand the Sorted Fund Finder is an independent, online resource.
A complete list of KiwiSaver providers is available on the KiwiSaver website if you want to get familiar with who is running the KiwiSaver schemes.
For anyone planning to head off on their OE or a similar long-term but not permanent move it is possible to keep your KiwiSaver account open when you leave the country.
The automatic contributions made through your salary will stop but you can make voluntary contributions while you're away.
Any contributions made while you're no longer living in New Zealand won't be eligible for the annual member tax credit payments.
It would also pay to let your KiwiSaver provider know you're leaving New Zealand, even if it's to just update your contact details.
If you are in KiwiSaver and plan on making the move overseas permanent you may be eligible to withdraw your money.
After living abroad for at least a year you can get in touch with your KiwiSaver provider and give it a statutory declaration saying the move is permanent.
Your provider will also want to see evidence that you've been living overseas for more than 12 months.
You'll be able to take any contributions you or your employer has made, the $1000 kick-start, plus any investment returns, but any member tax credits you've received will be repaid to the Government.
Superannuation savings already transferred from an Australian superannuation provider can't be taken out, which is something to keep in mind if you've got particularly itchy feet.
If further down the track you decide to reverse your decision and return to live in New Zealand then, if eligible, you can re-open a KiwiSaver account and start saving again. You won't get the $1000 kick-start when you start KiwiSaver a second time around.
If you're planning to emigrate to Australia slightly different rules apply.
Law changes agreed to on both sides of the Tasman in 2013 made it possible to transfer KiwiSaver funds, including the member tax credit and kick-start payments, to an approved superannuation provider in Australia.
It coincided with some major compliance and back office changes in the Australian super industry so implementing the systems to receive KiwiSaver transfers has been a low priority for superannuation players in Australia.
Hopefully this will change in the near future and already a few Australian providers - Perth-based WA Super is one of them - have begun to accept KiwiSaver funds.
I'd be interested to hear from anyone who has successfully taken their funds with them when they move to Australia.
Disclaimer: Information provided is stated accurately to the best of the respondent's knowledge at the time of publication. It is general in nature and should not be construed, or relied on, as a recommendation to invest in a particular financial product or class of financial product. Readers should seek independent financial advice specific to their situation before making an investment decision.
Question
To have your KiwiSaver questions answered by the NZ Herald's panel of industry players email Helen Twose, helentwose@gmail.com. Sorry, but Helen cannot answer all questions, correspond directly with readers, or give financial advice.
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