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KiwiSaver explained — how it fits into your financial planning
KiwiSaver is a long-term savings scheme designed to support retirement income and broader financial goals. It continues to evolve, and for most people it’s a core part of their savings plan.
KiwiSaver is simple in concept, but the decisions around it become more important over time.
1. You can only have one KiwiSaver account.
You can only have one KiwiSaver account at a time. That means simpler balances and one place to manage your savings. As balances grow, your choice of fund and provider becomes more important.
2. You choose your own KiwiSaver provider:
You choose your KiwiSaver provider and fund. There are many options - what matters is that the risk profile fits your goals and comfort with market ups and downs.
You can change providers, that involves selling and reinvesting the existing balance, which has costs and timing effects worth thinking through.
4. Low fees for KiwiSaver funds
KiwiSaver funds generally have lower fees than older managed investment options. Fees matter because they reduce your returns over the long run - especially in long-term savings like KiwiSaver.
5. Multiple contribution options to KiwiSaver
You choose how much you contribute to KiwiSaver — typically between 3% and 10% from your pay, or voluntarily if you aren’t in PAYE.
There’s a limit where government contributions stop matching, so think about what contribution level aligns with your goals and circumstances.
You can make regular or lump sum contributions to your KiwiSaver account.
6. How do KiwiSaver employer contributions work?
If you’re employed, your employer contributes a minimum amount to your KiwiSaver too. These minimums are increasing over the next few years, which affects your total savings rate.
7. Withdrawal from KiwiSaver for First Home purchase
After three years in KiwiSaver, you may be able to use most of your balance (apart from the government contribution and any required minimum balance) toward your first home. The funds go directly to your lawyer as part of the purchase.
7. Withdrawal of KiwiSaver money
KiwiSaver is primarily for long-term savings and is generally accessed when you reach the age of eligibility for New Zealand Superannuation.
There are exceptions including:
Significant financial hardship
Serious illness
Permanent emigration (excluding Australia)
Death (paid to your estate or nominated beneficiaries)
KiwiSaver incentives — current settings (as at April 2026)
• Employee contributions:
If you are employed, you generally contribute between 3% and 10% of your gross pay to KiwiSaver.
• Employer contributions:
Employers are required to contribute a minimum of 3.5% of gross salary or wages from 1 April 2026, increasing to 4% from 1 April 2028 under current legislation.
• Government contribution (Member Tax Credit):
If you are eligible, the government contributes up to $521.43 per year, provided you contribute at least $1,042.86 between 1 July and 30 June. Age, residency and contribution rules apply.
• Contribution flexibility:
If you are self-employed, not in PAYE employment, or taking a break from work, you can make voluntary contributions directly to your KiwiSaver account.
KiwiSaver rules and thresholds change over time. What matters is how the current settings apply to you now.
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E: contact@moneyworks.co.nz
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