Incentives for Saving and Home Ownership

The KiwiSaver Scheme

In July 2007, the NZ government is introducing a new savings scheme called KiwiSave. The scheme will help first time homebuyers. Individuals choose to save either 4% or 8% of their earnings in their KiwiSaver account and the government will make a payment of $1,000 into each account in the first year.

After 3 years of saving, the government will give qualifying individuals $1000 for each year of saving up to a maximum of $5000 towards a deposit for a first home. This will be called a deposit subsidy.

Individual savers can combine their $5000 deposit subsidies to produce a $10,000 payment for a couple buying their first home.

All New Zealand residents below the age of retirement will be eligible for a KiwiSaver account.

The scheme is not compulsory.

KiwiSaver schemes will be run by trust deeds and run in a similar way to registered superannuation / pension schemes. All KiwiSaver schemes will need to be approved by the Government Actuary. The government will not guarantee any individual scheme.