KiwiSaver changes provide earlier access to funds for people with shortened life expectancy
On 21 July 2019, the Government announced changes to KiwiSaver that allow people with life-shortening conditions to access their savings when they are ready to retire.
Who does this affect?
The changes will affect all KiwiSaver scheme providers, as well as those subscribers that would qualify under it. It will also be of interest to their advisers.
What does it cover?
There will be a new withdrawal category for people with life-shortening congenital conditions.
- The category will cover a set list of conditions named in the regulations.
- People with these conditions will automatically qualify for withdrawal. They will need to provide a medical certificate and other evidence to qualify.
There will also be an alternative process for people who have a congenital condition that is not named in the regulations. It will allow people to apply to their KiwiSaver provider to withdraw their savings.
Under the current requirements, people need to be 65 years of age to access their KiwiSaver funds. This disadvantages New Zealanders who may have a shorter life expectancy and wish to withdraw funds at a time that makes sense for them to retire.
This new withdrawal category will give these New Zealanders a better opportunity to benefit from the KiwiSaver scheme.
These changes are intended to come into force following amendments to the KiwiSaver Act 2006.
If you have any questions in relation to what these changes may mean for you or your business, please contact one of our experts.
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