Kiwisaver for business owners
As a small business owner, it’s easy to put retirement savings on the back burner while focusing on running your business. However, contributing to KiwiSaver is a simple and effective way to build long-term wealth. Unlike salaried employees, who have contributions automatically deducted from their wages, self-employed individuals and business owners need to take proactive steps to contribute.
How Much Should You Contribute?
To maximise your retirement savings, consider contributing more than the minimum required. The more you contribute now, the more you'll benefit from compound growth over time. Use this retirement calculator to plan how much you should be contributing to achieve your retirement goals.
To maximise the government contribution, you need to contribute at least $1,042.86 per year. If you meet this threshold, the government will contribute $521.43 to your KiwiSaver account annually. This is essentially free money towards your retirement, making it a smart financial move.
How to Make Contributions
Making contributions to your KiwiSaver account is simple and can be done in a few ways:
Set up an automatic payment through your online banking to ensure regular contributions.
Use the IRD (Inland Revenue Department) website to make voluntary payments (not recommended as the IRD charges payment processing fees when you pay this way)
Make a one-off lump sum payment before the end of the financial year to reach the government contribution threshold.
As a business owner, you have flexibility in how you contribute to KiwiSaver. You can:
Make personal contributions directly from your personal bank account.
Pay contributions from your business account, but note that this is considered a drawing rather than a business expense.
To ensure you hit the $1,042.86 minimum, we recommend setting up a monthly automatic payment of at least $87. This spreads the contributions out over the year, making it easier to manage cash flow while staying on track. The more you contribute
Why It’s Worth It
Investing in KiwiSaver is one of the easiest ways to build financial security for your future. Your contributions grow over time through investment returns, compounding into a significant retirement nest egg. Additionally, the government’s contribution boosts your savings without any extra effort.
By prioritising KiwiSaver contributions, you’re not only taking care of your future self but also ensuring that your years of hard work in business translate into long-term financial stability. If you’re not already making regular contributions, now is the perfect time to set up a plan and start investing in your retirement today.