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Buying your first home without KiwiSaver

February 28, 2021

If KiwiSaver isn’t an option to help you into your first home - don’t let that hold you back.

home sweet home doormat

Knowing when to buy your first home is always a tough decision – with house prices setting records and ongoing Covid-19 uncertainty, knowing when to make the move isn’t getting any easier. Whilst government changes around urban development and repealing the Resource Management Act are aimed to make it easier to build housing, it will likely be years until the positive impact of these is felt for buyers

So how can you still keep up the momentum of saving for your first home while you wait for the right time to make a move?

If KiwiSaver isn’t an option for you – maybe you’ve recently returned from living overseas, or haven’t been in a KiwiSaver scheme for the required three years – a managed fund can be a great way to get serious about investing for big life goals, especially if they're a few years away.

Check out these three reasons to consider using a managed fund to help you buy your first home.

1. You’ll have the potential for better returns

Over time, managed funds generally deliver higher returns than term deposits or savings accounts, although you’ll need to be comfortable with a higher degree of risk and seeing your balance going down as well as up.

The longer you can leave your money in, the longer it has to grow. Managed funds are particularly suitable for investors who can leave their money in for a medium term – about five years or more.

2. You’ll have the freedom to choose your contribution

mum sitting with two sons outside as happy family

For some Kiwi, having fewer opportunities than usual to spend during lockdown last year, or not being able to travel overseas has left them with an unexpected nest egg.

In our low-interest environment, investing your lump sum is more likely to grow your wealth over time, than putting it into a savings account or term deposit.

The beauty of managed funds is being able to choose how much you want to contribute. With Kiwi Wealth Managed Funds, you can open a new account from $100 and make contributions of as little as $1.

Even if you’re making small contributions, investing regularly can make a big difference to your wealth over time.

3. You’ll have the flexibility to access your money

In these unstable times, it’s good to know you can access the money in your Kiwi Wealth Managed Funds account if you need it.

Even if you have a KiwiSaver account, putting any extra money into a managed fund can give you more flexibility. It’s another way to save for a house, but you’ll be able to withdraw your money early, without penalties, if anything changes.

Whatever kind of home you dream of for your first property (and here are five suggestions if you’re lacking inspiration), Kiwi Wealth’s Managed Funds can help with the journey.

Tags: Investment Basics, Managed Funds

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