As an RDA member, you can join the superannuation scheme. Before you think, “I’m too young for superannuation” or “with my huge debt I need to pay that off first” think again. Below is a graph, which demonstrates the benefits of early commencement of contributions. Essentially if you leave it, you never catch up.
Member 1 – $100 per month for 30 years with a return of 6% (net) – includes a 2% CPI increase
Member 2 – $200 per month for 15 years with a return of 6% (net) – includes a 2% CPI increase
Assumption: Although both members invest the same total contribution the effects of time almost doubled the return for Member 1.
RMOs are amongst the very few health sector employees to have 6% employer superannuation contributions available – courtesy of NZRDA’s negotiations on our member’s behalf we unashamedly cry!
The RDA has a scheme that is transportable, allows us to suspend contributions for up to 2 years (and longer by agreement) in case we need to go overseas for instance. If you want more information on the scheme, please email email@example.com.
It is not the only scheme, however. There is Kiwisaver, and MAS has a scheme, amongst others, so seek some independent financial advice before starting employment. Remember if you wish to “opt out” of Kiwisaver, you have to do so (at law) within the first 50 days of employment.
The advantages of your superannuation scheme
Whilst anyone can start contributing to a superannuation scheme, our MECA provides for the employer to contribute equally to your scheme up to 6% of your income. Before you say, “I’m too young for superannuation” or “I need to pay off my debt first”, think again. The benefits of commencing contributions early are well established: if you delay, you can never catch up.
Flexible, transportable, matched contributions
RMOs are amongst the very few health sector employees to have superannuation available – courtesy of NZRDA’s negotiations on our members’ behalf. Our scheme is transportable and can be taken to any DHB in NZ – essential given our mobility between DHBs throughout our careers. We can also suspend contributions for up to 2 years (and longer by agreement) – in case you need to go overseas, for example. Funds are not locked in, and are available to you upon ceasing your employment with your DHB.
The DHBs match your contribution up to 6% a year. Past and present NZRDA members can join our superannuation scheme.
These are paid from the funds, or the underlying funds the funds may invest in. These vary between funds as some require more active management than others (you can see estimates of these charges on page 9 of the LifeSaver Plan Product Disclosure Statement). They are made up of 1) the Management fee charged by Fisher Funds for providing investment management services to the funds, and 2) the Expenses incurred by the funds such as accounting and investment transaction fees.
There is an Administration Fees of $6 per member per month or $2,000 per annum (spread across all NZRDA members of LifeSaver), whichever is the greater. Administration fees are currently $6.00 per member per month.
There are Legal, audit and registry services fees, all wrapped up together and applied to all members on a pro-rata basis. These vary depending on the fund and are set out in your transaction history.
The Supervisor Fee of $3,500 is spread across all members of LifeSaver and amounts to a modest annual charge (currently around $1.20 per member per annum). The Supervisor fee is deducted quarterly from your employer account and will vary from time to time depending on the number of members in the fund.
There are currently no establishment, termination, or withdrawal fees charged.
Under the NZRDA Plan, your employer (your District Health Board) will give you a $-for-$ subsidy up to 6% of your pay. This is the Employer Contribution. However, if you are a member of KiwiSaver, and wish to continue contributing to KiwiSaver, your employer will split the 6% Employer Contribution between the NZRDA Plan and KiwiSaver (3% each).
Want to know more?
If you want more information on the scheme, please contact the office firstname.lastname@example.org and we will provide all the information to you.