When Can I Withdraw From My KiwiSaver Account?

Your KiwiSaver Account

It’s important to remember the purpose of our KiwiSaver accounts. They’re a way to help us save money, usually for retirement.

Each pay day, a bit of money goes towards your KiwiSaver account where your KiwiSaver provider manages it and helps it grow in value over time. Due to its long-term nature, it can be harder to access these funds before retirement. If you withdraw money from your KiwiSaver account earlier, there is less money being invested on your behalf. This makes your balance grow more slowly – potentially leaving you with less money at retirement age. It’s always a good idea to talk to a financial adviser before making any big financial decisions to help you find what is right for you.

However, this doesn’t mean it’s impossible to access your funds before retirement. Below we have compiled some of the reasons you may be able to withdraw from your KiwiSaver funds earlier than 65.

When can I withdraw?

1. First home

The most common reason to withdraw from your KiwiSaver (other than for retirement) is for when you are buying your first home. Before you apply, you’ll need to make sure that you meet all the criteria for this type of withdrawal or check out our Guide to your First Home Withdrawal page.

But how much can you withdraw from your KiwiSaver to help buy your first home?

You can withdraw nearly all of your KiwiSaver balance. The only restrictions are that you’ll need to leave at least $1,000 in your KiwiSaver account. You’ll also need to leave any savings transferred from an Australian complying superannuation scheme and any Government Contributions received to your account while you were residing overseas.

To find the full eligibility details and terms about housing options with Kainga Ora, go to www.kaingaora.givt.nz/home-ownership.

Make sure to chat to a financial adviser before and after you purchase your home to make sure you’re still in the right type of KiwiSaver fund for you.

2. Permanent emigration

If you are permanently emigrating overseas, you can apply to withdraw your money from your KiwiSaver scheme and close your account.

If you’re emigrating to Australia there may be an option where you can transfer your KiwiSaver money to an Australian complying superannuation fund. However, this relies on the Australian complying superannuation scheme accepting your request. Note that you cannot transfer to an Australian Self-Managed Superannuation Scheme.

If you move permanently overseas to a country that is not Australia, you can apply to completely withdraw your KiwiSaver funds. If successful, these funds will be transferred to the bank account you have indicated, not to an overseas complying superannuation fund. You also must have been permanently emigrated for at least one year before your KiwiSaver savings are released to you. The funds you receive from this type of withdrawal will be an amount equal to your accumulation, but minus the total of any government contributions (which will be paid back to the Commissioner of Inland Revenue).

Find the Permanent Emigration to Australia Transfer Application Form here.

Find the Permanent Emigration Withdrawal Form here.

3. Significant financial hardship

While your KiwiSaver can assist you in times of financial difficulty, its main purpose is helping you save for retirement. You’ll need to meet strict criteria to be eligible for this type of withdrawal.

Some of the reasons you may be eligible for this type of withdrawal include:

Not being able to pay for minimum living expenses; or
Being unable to pay the mortgage repayments on your principal family residence resulting in the mortgagee seeking to enforce the mortgage on the residence; or
To cover the cost of modifying your residence to meet special needs arising from your or a dependents disability; or
To cover the cost of medical treatment for an illness or injury to you or a dependent; or
To pay for palliative care for yourself or your dependent or the cost of a funeral for a dependent.

You can apply to withdraw all the funds in your KiwiSaver account, excluding any Crown contribution, but this doesn’t mean you’ll be entitled to receive this amount. The amount you receive is at the Supervisor’s discretion (as opposed to your KiwiSaver provider’s discretion) and the amount paid to you will be the amount they believe is required to relive your short-term hardship.

Before you apply for this type of withdrawal, ask your bank for help and Work and Income New Zealand (WINZ) for assistance. Evidence that you have spoken to them, regardless of the level of help they offer, is important to an application.

If you are concerned about your finances, you can also arrange a visit to a Budget Adviser in your area. There are many free Budget Advisory Services across New Zealand who can give advice about government support, debt consolidation, and finance options.

Find the Significant Financial Hardship Withdrawal Application Form here.

4. Serious Illness

Your KiwiSaver funds can also be used to provide financial help when you have a serious illness.

A serious illness is defined as an injury, illness, or disability that results in you being totally and permanently unable to engage in work for which you are suited to by reason of experience, education or training or a combination of those things; or poses a serious and imminent risk of death. Your medical practitioner must also provide a declaration of serious illness as part of your application.

If you apply for this type of withdrawal, you can fully withdraw or partially withdraw from your KiwiSaver account.

Full withdrawal entails receiving the full amount of your KiwiSaver account. It may take up to 15 days as IRD processes your final government contribution. Selecting this option means your KiwiSaver account will be closed and you won’t be eligible to receive future government contribution and/or employer contributions until you rejoin a KiwiSaver scheme

If you choose to partially withdraw from your KiwiSaver account, you must withdraw at least $100 per withdrawal. You will still be entitled to government contributions and/or employer contributions for as long as your KiwiSaver account remains open. A minimum balance of $500 must be in your KiwiSaver account for it to remain open.

Find the SBS Wealth Serious Illness Withdrawal Application Form here.

5. Life-Shortening Congenital Condition

You are also able to withdraw your KiwiSaver funds if you are suffering from a life-shortening congenital condition. Life-shortening congenital conditions approved under the KiwiSaver withdrawal category include Down syndrome, cerebral palsy, Huntington’s disease, and fetal alcohol spectrum disorder. Withdrawals of this type will be treated as if you have reached the superannuation qualification age. Subsequent withdrawals, or if you wish to amend your original withdrawal instructions, will be made through a subsequent retirement application.

It is important to note that after the withdrawal of your funds you will no longer be eligible to receive government contributions and/or compulsory employer contributions. This withdrawal may also impact any social assistance that you are currently receiving, if any.

Find the SBS Wealth Life-Shortening Congenital Conditions First Withdrawal Request Form here.

- The Team at SBS Wealth