Lisa Dudson: Personal Finance Expert on the importance of collecting your full KiwiSaver entitlement from the Government

Each year the Government contributes up to $521.43 to a person’s Kiwisaver account. 

The cut off for the contribution is coming up next week, and KiwiSaver members could be missing out on as much as $55,000 in their retirement savings by not collecting the full contribution. 

Personal Finance Expert Lisa Dudson joined Jack Tame to discuss the long term importance of ensuring you collect your full contribution. 

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Episode Transcript

Speaker 1 (00:07):
You're listening to the Saturday Morning with Jack team podcast
from NEWSTALKSTB.

Speaker 2 (00:13):
It is fourteen minutes to eleven on Newstalk ZB. Today
is the twenty second of June. That means we're through
the winter solstice. It means there are only a few
days left before we hit the cutoff for the government
contribution to key we save A Personal finance expert Lisa
Dudson from Acumen is with us this morning. Hey Lisa,
good morning Jack. It's so good to be talking. So

(00:34):
talk us through what we need to have sorted. In
order to get the maximum government contribution.

Speaker 3 (00:41):
By the thirtieth of June, which is where the Key
to Savor year ends, it must have contributed one thousand
and forty two during that previous twelve months for the
government to pop five hundred and twenty one dollars into
your PV Saber account.

Speaker 2 (00:55):
And why is this so important?

Speaker 3 (00:58):
Well, because it ends up you know, I mean, you know,
five hundred and twenty one is essentially free money, right
as long as you contribute to the found important two
per year. And it may not seem like a lot,
but when you start adding that into a time factor,
that adds up to quite aficant amount of money over
the long term if you're in your twenties, right, and

(01:19):
you don't want to be in a situation where you're
not maximizing every dollar that you can get.

Speaker 2 (01:23):
Yeah, it's I mean, it's it's the classic compound interesting, right,
But it's funny if you think about investments, like, there
is no investment on earth that is guaranteed to give
you a fifty percent return as safely as this.

Speaker 3 (01:36):
Right, absolutely, you know, and it's free money. And the
thing I always loved that qusaper is a compulsory kind
of locked in nature of it, which you know, you know,
as a lot of value when you think about the
long term and when you get to know the sixty
five age where you can get those funds that accumulated
over time, and Albert Einstein talked about it compounding into

(01:57):
a spring, the aped wonder of the world, you know,
so money does significantly grow over time.

Speaker 2 (02:03):
Yeah, it's surprising to me that anyone would miss this,
But people missing new experience, Oh yeah, they do.

Speaker 3 (02:09):
And I think you sometimes it's a case of people
not really understanding it might be then going, oh, what,
it's only five hundred and twenty one dollars, whereas I go,
I understand the power of that over time, and you know,
sometimes as they just you know, it's they forget about.
That's the other big thing, because I do come across
people that kind of what they do is there. They
may be self employed, so they put the money in.

(02:31):
They have to contribute themselves rather than through you've been
an employee, and then might go, oh well, I'll just
put the lump on on every year, whereas my experiences
is you better to do that on a monthly basis,
because then you know for sure that you know you've
put enough money in to get that free government contribution.

Speaker 2 (02:46):
Yeah yeah, right, So Lances flicked some message this morning
to say, if I deposit one and forty two into
my kids key, we save it. Do they get the
government contribution even if they're not working.

Speaker 3 (02:58):
No, unless they're over eighteen, which they're not really it
cared by then, so you only get that to become eighteen.

Speaker 2 (03:04):
But if you're not working and you are over the
age of eighteen and you and you contribute that minimum,
you do get the government contribution, right.

Speaker 3 (03:13):
Yeah, yeah, you know, and to give in again. And
if people did, it's a normal of money. But if
I don't talking about my Cuba because I'm self empoyed,
I've only ever put the minimum in. So that's two
thousand and seven as an example, you know, the aeenth
to a start king saber, like the first month that
it was that was started. You know, I've got like
seventy five thousand dollars for in my cubsabor.

Speaker 2 (03:35):
Wow.

Speaker 3 (03:35):
You know, and that's by putting one thousand and forty
two in per year getting the gun from contribution albeit
the first cutting up to you head about five or so,
five or seven years, You've got a fact that they
next a dollar for dollar to two thousand and forty two,
whereas now it's obviously they paid sixteen cents on the dollar.

Speaker 2 (03:52):
Yeah, it's pretty amazing.

Speaker 1 (03:53):
Eh. Yeah.

Speaker 2 (03:53):
So that's that's an important point. So I'll tell you
what I do. I I have my superannuation thing, and
my work has a scheme that they had always had
a scheme that was set up kind of independently the
key we saver. So what I do is I do
the work scheme, but then in addition to that, I
do the one thousand and forty two dollars because like
I said, I'm always just like our fifty percent return,

(04:14):
thank you very much. Plus whatever game you get. Yeah,
so it just seems like an absolute no brainer. But
one of those things you do have to get sordered
right now.

Speaker 3 (04:22):
Yea, that's right. And you know, it's like a lot
of things in life. You know, we've got a greatly
long list of things we need to kind of do
in our in our world, right, we just need to
make it important enough that well remember to actually do it.

Speaker 2 (04:32):
Yeah, yeah, no, that's great advice. Thank you so much, Lisa.
That is Lisa Dudson. You can find her, of course
at akimen dot co dot nz.

Speaker 1 (04:41):
For more from Saturday Morning with Jack Tame, listen live
to News Talk z B from nine am Saturday, or
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