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Investment statement answers questions

Q.           What is MTC that you referred to in your recent HB Today column?  There are a few things about KiwiSaver that I don’t understand.  I joined a few years ago, when I was over the age of 60.   In May I turned 65 and I applied to withdraw my funds.   I went to ASB and was given the forms, jumped through all the hoops required and submitted my withdrawal request.   Then I waited…   and waited… checking my bank balance regularly for the appearance of my money.   When a couple of weeks had gone by I sent them an email asking about progress with my withdrawal.   I received a reply – ‘Your account records show that your withdrawal form was received however the Team advise that you are not eligible for the withdrawal until 15 October 2016.’   I phoned to ask why and was told it was because I joined after the age of 60.   At no stage was I told that I wouldn’t be able to get my funds when I turned 65.  How can they withhold that money from me?  It is in an account in my name, it is my money. I think it is terribly unfair that I can't have the money.
A.            I am sorry that you have had a disappointing experience with KiwiSaver. I am guessing that you were opted into KiwiSaver through work? If you had signed up yourself through an adviser they would have explained that someone like you who joins between the ages of 60 and 65 will have to be in the Scheme for five years before reaching what is called the ‘Qualifying Age’ when they can apply to withdraw their money. 
People who are opted into KiwiSaver through work are allocated to a default provider by Inland Revenue. The fund manager that they are allocated to (there are currently nine default providers) will then send a welcome letter with an investment statement. Did you read the investment statement? This is a legal document that sets out all the rules of the KiwiSaver Scheme. It is provided in a standard format and answers questions such as “What sort of investment is this?” and “What are my risks?” The section you need to read is “How do I cash in my investment?”  This explains that you can withdraw your money once you have reached the Qualifying Age which is the later of ‘the age that you become eligible for New Zealand Superannuation’ or ‘the date on which you have been a member of a KiwiSaver scheme for five years. Currently New Zealand Superannuation is paid to qualifying citizens and residents of New Zealand at the age of 65, so most people are also able to access their KiwiSaver at that time. 

I would urge KiwiSaver members to spend some time reading through their Scheme’s investment statement as there is a lot of useful information in there. If they can’t find the copy they were sent, they will be able to download it from the internet or ask the fund manager for a hard copy.
It is unfortunate that your bank was tardy in their communication. The default providers do have a very large number of members and providing advice and support to all of them is a challenge that some are rising to better than others. You may have expected some advice when you went into your bank? Be aware that many frontline staff are not qualified to give advice so they will avoid getting into a conversation with you which could be construed as ‘advice’.  This is another problem that needs addressing.
Moving on to your question about MTC, this stands for Member Tax Credits. Still confused? I am not surprised, this was a poor choice of words back when the KiwiSaver Act was drafted. Your Member Tax Credits is your annual top up from the Government of up to $521 into your KiwiSaver. The good news is that this will continue for you until you reach the Qualifying Age, and you will get full Member Tax Credits if can put $90 per month (or $20 per week) into your KiwiSaver yourself. 
Shelley Hanna is an Authorised Financial Adviser FSP12241. Her disclosure statement is available on request and free of charge by calling 06-8703838 or go to The information contained in this article is of a general nature and is not personalised. Send your KiwiSaver questions to
As published in the HB Today 14 July 2015