Helpdesk
Commentaries
What's in it for me - self-employed
- 21/12/2011
KiwiSaver is about securing a better future. Whether it is to save a deposit for a house or for your ultimate retirement, you can generally save more in KiwiSaver than in alternative investment products. If you are not an employee (e.g. self-employed, a beneficiary, a stay-home parent, etc) saving $1,043 a year ($87 a month) maximises the government’s benefits you can save less. If you are not an employee, you do not need to save at all.
Example: save $1,043 a year
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After 1 year, the position is: |
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| Your savings | $1,043 | i.e. $86.92 a month | ||
| Government's kick-start | + $1,000 | |||
| Government's MTC tax credit | + $ 521 | $1 for $2 up to $521 for a full year | ||
| Investment earnings | + $ 63 | (Say 5% after-tax) | ||
| Fees | - $ 33 | |||
| $2,594 | ||||
|
After 5 years*, the position is: |
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| $5,215 | + | $4,646 | = | $9,861 |
| Your savings | Government, employer payments and interest | Projected balance | ||
* If you are not an employee, you can choose how much you save. If you become an employee, you must save 2% of your total before tax salary (3% from 1 April 2013) until you have been in KiwiSaver for at least 1 year.
