Six weeks out from the launch of KiwiSaver, the voluntary workplace-based retirement savings scheme remains a mystery for many people, according to research from fund manager ING.
The survey of working age people found that just under two-thirds were aware that a workplace savings scheme was about to
be launched, while almost 80 per cent said they knew few details about KiwiSaver.
Under the scheme employees will have either 4 per cent or 8 per cent of their pre-tax income deducted from their pay and invested by a private sector fund manager to provide them with retirement income. The Government is expected to reveal a tax-based sweetener for the scheme as part of the Budget today, possibly making employee contributions tax free or allowing some kind of tax rebate on them.
According to ING's survey, those that were aware of the scheme had a patchy understanding at best. More than half mistakenly believed funds contributed under KiwiSaver would go into the New Zealand Superannuation, or "Cullen", Fund.
Other findings included that more than half of those surveyed had no form of retirement savings and only 13 per cent felt they had their retirement savings under control.
The survey also showed 50 per cent favoured the kind of compulsory workplace superannuation scheme which Australia has had for the past 15 years.
ING's Steven Giannoulis said the survey showed people understood the need for a mechanism to help them save for retirement and saw direct deduction from their wages as the most appropriate way to achieve this.
ING is one of the six default KiwiSaver providers who will automatically be appointed to manage savers' money unless workers select another fund manager.
AMP found 75 per cent of working age people were aware of KiwiSaver and 46 per cent were likely to join.
Not So Super Ing's
survey of working age people found:
* Only 13pc feel they have their retirement savings under control.
* 53pc have no retirement savings plan.
* 62pc aware a workplace savings scheme is about to be launched.
* 78pc know few details of KiwiSaver.
* 50pc favour compulsory super.
