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What does the holiday season mean for my KiwiSaver?
The short answer to this is, well, hopefully nothing!
Why?
If you understand your KiwiSaver strategy, i.e. you know are in the correct fund for your investment term, you have the right tax rate and the right contributions rate - then holidays simply mean the status quo for a long-term investment like KiwiSaver.
If your settings are correct, your KiwiSaver will simply tick along by itself. No worries, mate.
Not feeling confident? Three things to consider:
If you don't have confidence in your settings above, it's time for a free KiwiSaver chat with our advisory team to see where you are at. The type of fund you are in can make a huge difference to what you'll have when you need to use the funds. This is super important to know what you are set up for and this is easy to do. Kiwis are big on their KiwiSaver, but the statistics frequently show that a lot don't know or understand what their settings are. If it is important to you, get it checked! Book yourself in here.
The increased cost of living has been hard this year. If you are struggling with expenses this holiday season, you can take a break from your KiwiSaver contributions if you have been contributing for more than one year. Note - this means your employer will stop contributing too (unless agreed otherwise) and you may not get the government contribution. Check out the IRD website for more information about this. Now, we wouldn't be a very good financial advisory service if we didn't note here that pulling out of your retirement investment might not be the best idea!! If there are other costs that can be saved elsewhere, let's look to those first. Seriously, do talk to our advisers or at least visit the Sorted.org website and check out the budgeting tool (and then talk to us 🙂).
Market conditions fluctuate, so don't panic if your KiwiSaver drops over Summer. If that happens, try not to tamper with your KiwiSaver without getting advice first. Changing funds after a loss will lock your losses in. Not sure about what fund to be in or just feeling unsure? Again, this is where you want to talk with one of our advisers. It is important to consider long-term trends and your end goals, and it can be a simple conversation on the phone for some reassurance if you need it. So don't hesitate to reach out!
KiwiSaver is just one part of a healthy and diversified financial strategy. What about the bigger picture for your life? Do you know where you are headed? Do you know how to make the money, work the money and protect the money you need, in order to make your dream happen?
If not, talk with our financial planners Elizabeth or Dean in the New Year about how they can help you create a plan going forward. Come for a coffee in the new offices and pick their brains! They're really good at what they do!
Shona.
Disclaimer: I am not a financial adviser and what I have shared is general advice. As always, make a time with our financial advisers about your own situation.
Always get professional advice
The information shared in this post is meant to be general guide to support you on your journey. When making important decisions about your finances, we encourage you to seek independent financial advice first, tailored to your unique situation. As well as talking with your Velocity Financial adviser, make sure you talk to your lawyer and accountant too – together they'll help you find the best solution for your specific situation. Our knowledgeable financial advisers are here to help. Check out our website for the details about our financial advisory services in our disclosures:
https://www.velocityfinancial.co.nz/disclosure-statement.