KiwiSaver

KiwiSaver is a voluntary savings scheme run by the government to help New Zealanders to save for their retirement. In some cases, KiwiSaver can also be used towards buying a first home.

Members who are employed can choose to contribute 3.5%, 4%, 6%, 8% or 10% of their gross salary or wages to their KiwiSaver account. From 1 April 2026, the default minimum employee contribution rate is 3.5%.

If you are contributing through your employment, your employer will generally also contribute a minimum of 3.5% of your gross salary or wages, provided you meet the eligibility criteria. Employer contributions are taxed, so the amount that reaches your KiwiSaver account may be less than the full 3.5%.

The government may also make an annual contribution to your KiwiSaver account. From 1 July 2025, eligible members can receive 25 cents for every dollar contributed, up to a maximum government contribution of $260.72 per year.

There are many KiwiSaver providers to choose from, and your provider invests your savings on your behalf. If you do not choose a provider when you join, Inland Revenue will allocate you to a default KiwiSaver provider.

If you’re 18 years or over, you will be automatically enrolled into KiwiSaver if you start a new job (with a few exceptions). Your KiwiSaver account is not just a savings account; it has the additional benefit of a managed fund. This means a fund manager will invest your KiwiSaver savings on your behalf so that you can earn returns on your savings over time.

Your KiwiSaver account can continue to grow with:

• Your automatic contributions
• Your employer contributions
• Government contributions
• Investment returns
• Any additional personal voluntary contributions

There are many different types of KiwiSaver schemes available and the right one for you will depend on how long you wish to save for and how much risk you are willing to take. The higher your risk profile, the higher the potential for improved performance, but with more variability in the day to day balance.

Whatever your financial plans are, your savings can be used to help meet your needs:

Saving for a First Home – if you’ve been a member for at least 3 years, you may be eligible to withdraw most of your KiwiSaver account contributions to buy your first home. If you’ve owned property previously, this may also apply to you.

Saving for Retirement – If you choose to use your KiwiSaver investment to save for retirement, you can only withdraw after the age you are qualified for New Zealand Superannuation (NZ Super). Currently Kiwi’s receive NZ Super at the age of 65.

Find out how much you should save for retirement with our retirement calculator or by getting in touch with the experienced Qualified Financial Planners at MyFuture.

Although KiwiSaver is a great savings vehicle with some good benefits, it’s not appropriate for everyone. It’s important to understand that your KiwiSaver investments are locked away until you’re 65 (unless you meet any of the criteria to withdraw below). So if you’re planning on retiring early, then you won’t be able to rely on any of your KiwiSaver savings to help provide an income for your early retirement. Also, at this stage you can only withdraw KiwiSaver for your first home purchase.

This means if you find you’ve been priced out of the NZ housing market and decide to put your KiwiSaver savings to good use by purchasing a more affordable investment property in a different location, you won’t be able to use your KiwiSaver savings to do so – this could have serious consequences on your long-term wealth creation potential.

Although KiwiSaver might not be your only savings tool, it is a great supplement to your other financial tools as there are many benefits to KiwiSaver. Investing in KiwiSaver is a no brainer for every New Zealander because:

• Your KiwiSaver investment contributions come straight out of your pay, making saving easy.
• Your employer has to contribute on top of your own contributions.
• You receive government contributions annually as well.
• You can choose whether to save for your first home or for retirement.
• Your KiwiSaver account moves with you if you change jobs or leave the workforce.
• There are ways to access your KiwiSaver savings should you find yourself in significant financial hardship.
• It offers a low cost option to invest in managed funds.

Although KiwiSaver is designed for retirement and first home savings, you can also apply to withdraw some of your savings if you are suffering or likely to suffer from significant financial hardship.

Significant financial hardship is defined in the KiwiSaver Act as financial difficulties arising because of:

• the inability to meet minimum living expenses
• the inability to meet mortgage repayments on your principal family residence resulting in the mortgagee seeking to enforce the mortgage on the residence
• the cost of modifying a residence to meet special needs arising from a disability of a you or a dependent
• the cost of medical treatment for an illness or injury of you or your dependent
• the cost of palliative care for you or your dependent or the cost of a funeral for a dependent or
• If you are suffering from a serious illness.

Our Qualified Financial Advisers at MyFuture can provide comprehensive financial guidance to get you started with your KiwiSaver investments today! Get in touch for your no obligation FREE Discovery Session.