The number of people accessing their KiwiSaver to make ends meet is expected to rise as people start to rebuild after the severe weather events of the past few months.
The KiwiSaver scheme was designed to only be accessed when someone retires or purchases their first home, but people can withdrawal savings if they meet the criteria for financial hardship.
Kōura Wealth managing director Rupert Carlyon says he has seen an increase in KiwiSaver queries after the Auckland floods and Cyclone Gabrielle.
Accessing KiwiSaver savings under hardship can be a daunting and complicated process and applicants have to prove they have no other options, says Rupert.
“The key to accessing your KiwiSaver for financial hardship, it’s really [about] proving to the supervisor of the KiwiSaver scheme that you’ve got nowhere else to turn, because that’s the key thing for them.
Rupert says Kōura Wealth is fielding queries from Auckland residents unable to pay the insurance excess on their severely damaged homes after February’s flooding, or who live in the Hawke’s Bay and have been made redundant.
This week, the government expanded temporary accommodation services for people displaced by recent storms to cover regions affected outside of Auckland, including Te Tai Tokerau, Tai Rāwhiti, Hawke’s Bay, Bay of Plenty, Waikato and Tararua District.
Rupert says some financial advisers rule out accessing KiwiSaver at any time, even under extreme hardship.
It’s important people accessing their KiwiSaver only withdraw what they need, because the scheme aims to accumulate wealth over time, says Rupert.
If they spend money today and take money out of their KiwiSaver, then they’re going to have to fund their retirement from somewhere else.
Credit: sunlive.co.nz
