Can kids gift us Kiwisaver?
If house prices feel unreachable, that’ll change, writes Shelley Hanna
QMywifeandimovedto Newzealand a fewyears ago to join our adult childrenwhoarrived in 2008. Wehavepermanent residenceandhave been saving to buyahouse. Aswejoined Kiwisaver three years ago, wecan nowmakeafirsthome withdrawal. However, becausewe haven’t beenmembersfor very longwehave only saved amodest amount. Weare wondering if our adult children can gift their Kiwisaver to us to assist with the deposit for our firsthome?
AHouse prices have risen steeply due to strong demandand falling interest rates. This is a worry for people like youwhofeel that the chance ofhomeownership is slipping away. Rest assured that house prices anddemandmovesin cycles. Justwhenyou think it is out of reach, circumstances will change and you will get an opportunity to buy. People are saying, “It’s different this time” but believemei have heard thatmanytimes over the past 30 years and Ihave yet to see them proved right.
In respect of your question, I regret to say the answer is no. The notion of gifting Kiwisaver tosomeone else goes against the purpose of the scheme. Each Kiwisaver account is in thenameof the individual and it cannot be jointlyownedor given to another person.
Oneexceptionmaybe by court order if a couple separate after three ormoreyears of living together, if there is no prenuptial agreement (contracting out of the Property (Relationships Act). In that situation one personmaybe required to share someof their Kiwisaver with their former partner.
The only other situations where amember can access their Kiwisaver before age 65 are serious illness, significant financial hardship, permanent emigration (other than to Australia) and buying a firsthomefor yourself.
In your situation, if your adult children do not alreadyown property they could buy ahouse with you— as long as they intend to live in it for at least six months. Eligible Kiwisavermemberscan withdraw all but $1000 from their Kiwisaver (but not any funds transferred from Aussie Super). They mayalso be eligible for financial assistance with the Firsthomegrant fromka¯inga Ora, which is worth up to$5000 for an existinghomeor $10,000 for a newbuild. The maximumfor multiple buyers is $10,000 for an existinghomeand $20,000 for a newbuild. The rules are similar for previoushome ownerswhono longerownproperty.
There is a very goodsummaryof all criteria for buying a firsthome with Kiwisaver on themoneyhub website.
There are also useful case studies and application forms on theka¯inga Ora website.
Shelley Hanna is an authorised
financial adviser FSP12241. Her disclosure statement is available on request and free of charge by calling 06 870 3838 or going to peak.net.nz.
The information contained in this article is of a general nature and is not personalised. Send your questions
about Kiwisaver to shelley.hanna@peak.net.nz