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Behind the scenes: Sharesies KiwiSaver Scheme


We explore what happens when you sign up to the Sharesies KiwiSaver Scheme—including how your balance gets transferred from your old provider and invested based on your investment plan.

Step 1: Your KiwiSaver balance gets transferred

Once you’ve signed up to the Sharesies KiwiSaver Scheme, we notify Inland Revenue (IRD) who updates their records and connects your KiwiSaver account to the Sharesies KiwiSaver Scheme. 

If you have an existing KiwiSaver account

If you have an existing KiwiSaver account, IRD provides us with the details of your old provider. We use this info to request a transfer of your KiwiSaver balance.

Your old provider closes your account and transfers the money to us, along with a breakdown of the transfer. This breakdown includes the total amount transferred, the contributions you’ve received (kickstart, employee, employer, and government contributions), and whether you’ve made a first home withdrawal. The transfer process takes up to 10 business days.

If you’re joining KiwiSaver for the first time

If you’re joining KiwiSaver for the first time, you’ll be able to view your KiwiSaver account in the Sharesies app within around 5 business days

Note that for the first 62 days of joining KiwiSaver, any employee or employer contributions won’t be sent to your KiwiSaver account—they’ll be held by IRD before being passed on to us. This is called the ‘cooling off period’; legislation that gives people time to decide whether KiwiSaver is right for them, even after they join. 

Step 2: Your KiwiSaver balance gets invested

The balance that gets transferred from your old provider to the Sharesies KiwiSaver Scheme is invested based on your chosen investment plan. This happens each morning.

For base funds, we instruct Trustees Executors Limited (TEL) to place an order with the fund managers you’ve chosen to invest your money with. TEL is the external custodian who holds all of the money and investments for the Sharesies KiwiSaver Scheme in a trust (a way to hold assets separately and protect ownership). 

These orders can take between 3–5 business days to complete, depending on the fund, and we issue you with units that are backdated to the day the order was placed.

For self-select investments, Sharesies Market Service (the system that connects Sharesies to an exchange) is used to place an order on the market. Sharesies Market Service uses an algorithm that aims to get the best available price for the order, in line with our best price policy. This is also known as ‘price discovery’.

Price discovery involves looking at things like the last traded price, market conditions, and availability of buyers or sellers—and then making adjustments until we find a price to trade at within a limit that we set. Once orders are filled, your units in the fund are issued. Orders usually take another 2 business days to settle

We allocate units to you in the Sharesies KiwiSaver Scheme Self-Select Fund that invests directly into the base fund, company, or exchange-traded fund (ETF) you’ve chosen.

Sharesies KiwiSaver Scheme Self-Select Fund

When you select companies and funds for your investment plan, you invest into a Portfolio Investment Entity (PIE) fund (called a single-asset fund) managed by Sharesies. The PIE fund then invests in the specific company or fund you’ve chosen. This means that the unit price of the PIE fund may be different to the listed price of the underlying investment.

For example, if one of your picks is Air New Zealand, your contributions are invested into the Sharesies KiwiSaver Scheme Self-Select Fund. The fund then buys and holds shares in Air New Zealand and you’re allocated units in the Sharesies KiwiSaver Scheme Self-Select Fund. 

Being a PIE fund means that any investment income (like dividends) will be taxed based on your prescribed investor rate (PIR). 

Step 3: Future contributions arrive in your account

Once you’ve joined the Sharesies KiwiSaver Scheme, contributions are made from:

  • you—your choice of 3%, 4%, 6%, 8%, or 10% of your pay

  • your employer—another 3% (of your salary, or on top of your salary)

  • the government—up to $521.43 every year that you’ve contributed at least $1,042.86.

It’s worth noting that the Employment Relations (Protection for KiwiSaver Members) Amendment Bill 2023 is going through Parliament at the moment, which will reinstate protection from total remuneration that was removed in 2008.

You can also make voluntary contributions to IRD through online banking.

Contributions are paid to IRD first, before being passed on to the Sharesies KiwiSaver Scheme. It generally takes around 2-3 working days from when your employer makes a payment to IRD for the money to arrive in your account. We then invest the money based on your current investment plan. This happens the next morning after your contributions have been allocated to your account. 

Wrapping up

Head to our help centre for more info about how the Sharesies KiwiSaver Scheme works—including further details about tax and fees.

Ok, now for the legal bit

Investing involves risk. You aren’t guaranteed to make money, and you might lose the money you start with. We don’t provide personalised advice or recommendations. Any information we provide is general only and current at the time written. You should consider seeking independent legal, financial, taxation or other advice when considering whether an investment is appropriate for your objectives, financial situation or needs.

Sharesies Investment Management Limited is the issuer of the Sharesies KiwiSaver Scheme. The product disclosure statement (PDS) for the Sharesies KiwiSaver Scheme has been lodged, and may be viewed on the Disclose Register or on our documents page.

Join the KiwiSaver scheme that’s more you

Portfolio displayed is a guide, not from a real customer. For informational purposes only.
A young woman looking off to the side holds a lime-green electric guitar. Superimposed next to her is an iPhone showing a screen in the Sharesies app. The screen shows a KiwiSaver investment portfolio, made up of the Pathfinder Ethical Growth Fund, the Smartshares NZ Top 50 Fund, Meridian Energy, and Infratil.