October 16 2014
Insurance & Savings Ombudsman Karen Stevens has a Money Week reminder about the strict criteria around withdrawing your KiwiSaver funds early.
“KiwiSaver Schemes are designed to help you save for retirement. There are only limited circumstances in which you can withdraw your money before you reach 65,” says Karen.
“The ISO Scheme has received over 80 complaint enquiries and complaints about KiwiSaver. Most are from people who want to withdraw their savings before retirement, and find that they can’t.”
Accessing your KiwiSaver savings early is only possible if you are:
• Experiencing significant financial hardship;
• Buying your first home;
• Experiencing serious ill-health; or
• Moving overseas permanently.
Karen says 32% of the ISO Scheme’s KiwiSaver contacts are from people wanting to withdraw their funds due to ‘significant financial hardship’.
“Some people are in really difficult financial situations,” says Karen, “but they still may not qualify to withdraw their funds on the basis of significant financial hardship. The criteria is about being unable to meet minimal living expenses, and having no possible alternative other than your KiwiSaver savings.
“KiwiSaver Schemes may decline to release funds because someone has another possible option, or they don’t meet the criteria in another way. Also, many people face delays because they don’t supply all the information they have been asked for. KiwiSaver Scheme trustees cannot consider your application until they have all the necessary information.”
Karen says there’s very little the ISO Scheme can do if people don’t meet the legal criteria. “People should always contact their KiwiSaver Scheme in the first instance and talk to them about what information is required.”
See the ISO Scheme KiwiSaver information sheet.
Or the Government KiwiSaver website: www.kiwisaver.govt.nz
Or contact your local Family Budgeting Service www.familybudgeting.org.nz for help with your application or your finances in general.
Or contact the ISO Scheme.