Q My wife and I are thinking about going to live overseas in 2024. By then we will both be 65. Our preferred options are Rarotonga or Brisbane. Will we be able to take our KiwiSaver with us? And can we get NZ Super if we are living overseas? We were born in New Zealand and have lived here all our lives.
A I will answer your question about KiwiSaver first, as it is the more straightforward question. When you reach the age of eligibility to make a KiwiSaver retirement withdrawal (currently age 65) you can withdraw your funds.
You can be living here or overseas at this time, but you must have a bank account in New Zealand that the funds can be paid out to.
You will need to apply to your fund manager by filling out the standard form they provide for people who have reached the qualifying age.
It may take a few weeks for your withdrawal request to be processed, but once your KiwiSaver funds have been paid out to you, you are free to spend them as you wish either here or overseas.
The rules around KiwiSaver are simple compared with New Zealand superannuation, as far as living overseas is concerned.
According to the Work & Income website: "If you get New Zealand Superannuation or Veteran's Pension, you can go anywhere in the world and you may still be able to take up to 100 per cent of your gross payment with you. What you'll get depends on where you go to and how long you've resided in New Zealand." This sounds quite simple and rosy, but when you start looking at individual countries you will find a wide range of different outcomes.
At the "rosy" end, New Zealand has a special portability arrangement with 22 Pacific countries including Rarotonga. According to the Work & Income website, you can reside in any of these 22 countries and get some or all of your New Zealand Superannuation or Veteran's Pension. You must apply before you leave New Zealand.
It gets tricky if you move to a country with which New Zealand has entered into a Social Security Agreement, such as Australia, or the United Kingdom.
You will be expected to apply for a pension in these countries. If you move to Brisbane you can continue to get your NZ Super payments for up to 26 weeks after you leave New Zealand.
You must apply for the Australian Age Pension at Centrelink Australia within 26 weeks of leaving New Zealand, regardless of whether you believe you will qualify or not. If you don't, and you don't return to New Zealand within 30 weeks, you will need to pay back any payments of NZ Super made from the day after you left New Zealand.
Unlike NZ Super, the Australian Age Pension or AAP is income and asset tested. The age of eligibility has been raised to 67. Many Australians are now "self-funding" their retirement as they do not qualify for the AAP.
Anyone receiving NZ Super and planning to travel overseas should arrange a meeting with the International Services team at their local WiNZ office at least four weeks before they leave.
If you are thinking of moving overseas permanently, talk to them well before you make any firm decisions.
With increasing longevity people may spend many years in retirement and living overseas may be an attractive option, but it will take careful planning.
Keep up to date with any changes in government social welfare policies which may affect your plans.
- •Shelley Hanna is the communications manager with Peak Portfolio Management Ltd which is a Financial Advice Provider licensed by the Financial Markets Authority. Disclosure information is available at www.peak.net.nz or call 06 8703838. The information provided in this article is of a general nature and should not be relied on as a recommendation to invest in a financial product. Send your KiwiSaver questions to email@example.com