While it is now possible to transfer funds from your Australian superannuation scheme to KiwiSaver, this is not something that should be done without consideration of a number of important factors. There are many good reasons to bring your superannuation home. Having investments in more than one country can make life more complicated than necessary, and if your Australian superannuation is a relatively small amount, you may choose to transfer it just for simplicity. Access to informed, personalised financial advice on your investments is another good reason to transfer. Bringing your funds back reduces your exposure to exchange rate fluctuations, however the transfer value will be impacted by the exchange rate at the time of transfer.
There may also be good reasons why you might choose to leave your superannuation in Australia. Have a look at the benefits you are entitled to from your Australian scheme. At what age are you able to withdraw the funds? Are there additional benefits such as life insurance or income protection insurance included with your investment? Is there a guaranteed value at retirement age? What is the fee structure? Will there be a fee charged if you transfer? There are also tax considerations. In Australia, the earnings on superannuation schemes are taxed at a flat rate of 15% however there is a capital gains tax. For KiwiSaver, the earnings on your investment will be taxed at your marginal tax rate up to a maximum of 28% but there are benefits in how capital gains are taxed.
Having decided you wish to transfer your funds, check with your KiwiSaver provider that they are able to accept your funds and establish if there is any fee involved. You can change your KiwiSaver provider if necessary. Transfers are best done with the assistance of a financial adviser.
