I’ll start this post by stating that I am generally supportive of Kiwisaver as a scheme. I deeply regret the decision taken by the national government to remove the ‘carrot’ from the scheme and would much sooner have seen them scrap the bat-shit crazy interest free student loans rort to make their numbers.
So I am a little torn with the new Labour policy for compulsory Kiwisaver. I think there are a few things we can all agree on
So beyond all the usual stuff that’s been discussed today I have one really major concern with compulsory Kiwisaver
It’s going to knock the stuffing out of small business startup capital. Basically the money that many people would have put into a liquid investment such that they could draw down to start a business will instead be locked away in a conservative investment vehicle until they are 65. Now starting your own business is risky to be sure, but, are we really saying that someone on $80k in a solid job should be denied the opportunity to put their money aside to invest in their own venture?
What do others think?
People will point to the success of compulsory super at these kinds of pre-tax levels in Australia, but, the Australian scheme is quite different to Kiwisaver and in particular their Self Managed Super Funds provide some relief to the above concerns.
The argument about whether small business owners can bear the burden of these Kiwisaver payments is somewhat moot if they were never in a position to start their small business in the first place.
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