KEY POINTS:
Q. I'm to go on maternity leave in August and won't be returning to work for some time. Can I sign up to KiwiSaver to get my government contribution but not make any payments for 18 months or so?
A. You can join through contacting a scheme provider direct as an employee. You need to name your employer and make contributions to your KiwiSaver account up until the time you go on maternity leave. As you will no longer be earning, no deductions will be made. If, however, you are eligible for paid parental leave, you can elect to do nothing, or instruct Inland Revenue to have KiwiSaver deductions made from your paid parental money.
Q. Is there any category of people that would be ill advised to sign up for KiwiSaver?
A. This is something that Inland Revenue cannot comment on as it is financial advice. It is up to an individual to ascertain after they have sought independent financial advice if KiwiSaver is right for them. Additionally, people can visit the www.sorted.org.nz website for free, independent financial information which could help them make this decision.
Q. We have heard nothing from our employer about KiwiSaver. What obligations do employers have to advise staff about KiwiSaver and how the company will handle it?
A. Your employer is not able to prevent you from joining KiwiSaver if you wish to do so. The Employment Relations Act 2000 requires all employers to act in good faith in employer relationships, which implicitly includes treating employees the same whether they are a KiwiSaver member or not. All employers by law have to make KiwiSaver information available to new employees and those existing employees who ask for it. Your employer also must automatically enrol all new employees who are eligible.
Q. What happens if I sign my toddler up for KiwiSaver now? Do any payments have to be made? Will it just sit in an account until he gets his first part-time job or a generous grandparent makes a donation?
A. You would need to contract directly with a scheme provider and work out with them what schedule of contributions need to be made up until the child is able to make their own contributions.
Q. Are there ethical investment portfolios available as an option to safeguard us from investing in an industry, such as arms, on which we may have strong views?
A. It would be best to check with the scheme providers to ascertain if they offer ethical-only investments. Also a person is totally free to make their own choice of scheme, and to change that scheme at any time should the scheme later invest in what you consider to be unethical investments.
NEXT WEEK: Minister of Education Steve Maharey on the Government's scheme to provide 20 hours of free preschool to 3 and 4-year-olds.
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