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Bill English Talks About Making Changes To KiwiSaver

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Contributor:
Brian Dalley
Brian Dalley

Less talk and more action Bill as the current restrictive policy is putting many off investing in the scheme.

I questioned a client the other day as to why he, his wife and their son weren’t signed up to KiwiSaver. His reply was typical of what many others are saying, "I’m not going to throw money at a scheme that I can’t touch until I am 65".

On paper it looks like [the investment opportunity of a life time] and it could be. From the age of 18 the government will back you dollar for dollar each and every year up to a $1040, and if you are working your employer will kick in BUT Hayden would have to wait for 35 years before he could crack open the piggy bank, his Wife June 40 years and little Sam, 60 years.

But Brian over one million people have joined. Wow! Come on, less than - of those eligible have signed up to an investment that offers a 100% + return, I don’t think that is something to get excited about.

Don’t get me wrong I think it is a great idea and wanted to produce a monthly Newsletter on the subject but the IRD gagged that by shrouding it in red tape. Shame really as there are many good things to be said about the scheme and it is a real shame it only makes the headlines when doggy salespeople make the headlines. It will be interesting to see what happens about that.

Back to my point - I feel the scheme is too restrictive - and offer the following suggestion as a solution. Yes I have copied this Blog to Bills office.

We live in an instant society and that isn’t going to change. Telling an 18 year old they have to wait 47 years before they can crack open the piggy bank - sure there a few exceptions - but I am talking generally, isn’t really a deal breaker.

The simply aspect, be a little more realistic about the term, age 65, why not 20 years or age 65? That way an 18 year old could pull the funds at age 38.

At the end of the day it is just a thought and would welcome your views. What do you think the time frame should be?

Brian Dalley is a leading Property Consultant | former NZMBA Mortgage Broker, and Real Estate Agent.  You can read more of his views and opinions on his website www.propertyprofit.co.nz.

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