A.       A KiwiSaver account is an asset just like - let’s say - your car, your chainsaw and your father’s war medals. 

 

When someone dies whatever they owned themselves becomes part of their estate. Any debts they had in their name are paid off first. The debts may include repayments on a car or a credit card debt. Whatever is left is distributed to their heirs according to their Will, or if they don’t have a Will, then according to the Administration Act 1969. 

 

Many couples (whether married or not) will have some of their assets in joint names (such as the family home) and on the death of either of them those joint assets will pass automatically to the surviving person. 

 

A KiwiSaver account will always be in the name of just one person, so it is important to draw up a Will to specify who should inherit this asset on your death, as well as any other assets that are not in joint names. 

 

In a straightforward domestic situation a person may leave their estate to their spouse or partner if they are still alive and if not, shared equally among their children. With second marriages and blended families the situation may be more complicated and a Will becomes even more important. 

 

If you die without leaving a Will, as mentioned earlier your estate will be distributed according to the Administration Act 1969. There are different outcomes for different situations. If for example you leave a partner (married or de facto) and children, the partner will receive all your personal goods, assets totalling $155,000 and one third of anything above that. Your children will receive two thirds of everything above $155,000.

 

There are usually delays in situations where there is no Will, and the legal costs may be higher. It is also likely to cause more distress to your loved ones. So for all these reasons everyone with assets should have a valid Will.

 

Coming back to KiwiSaver, if a person dies leaving a balance of more than $15,000 a certified copy of Probate (if there is a Will) or Letters of Administration (if there is no Will) will have to be provided along with other documentation.

 

If the balance is less than $15,000 then the next of kin may be able to have the funds paid out without providing a copy of the Will or Letters of Administration. They will have to supply information to prove their identity and their relationship to the deceased and it can be a very time consuming and frustrating process.

 

Each Scheme has their own form and all applications for withdrawal have to be signed under oath before a JP, lawyer or other person authorised to take a statutory declaration.

 

Of course this is a general guide only and readers should seek legal advice for their situation.