Key takeaways
- KiwiSaver is a voluntary, work-based retirement savings scheme.
- Your fund type (conservative to aggressive) has a big effect on long-term results.
- You can usually withdraw at 65, or earlier to help buy a first home.
In short
KiwiSaver is New Zealand's voluntary retirement savings scheme. You, your employer and usually the government contribute, and the money is invested in a fund you choose.
Contribution rates and government settings change from time to time, so always confirm current figures with Inland Revenue before making decisions.
How KiwiSaver works
When you join through work, a percentage of your pay is deducted and sent to your provider. Employers generally contribute too. If you are self-employed or not working, you can still join and contribute directly.
Choosing a KiwiSaver fund type
Funds range from conservative (more cash and bonds, smaller ups and downs) to growth and aggressive (more shares, bigger swings, higher expected long-term returns).
- Shares 70%
- Property & infrastructure 10%
- Bonds 15%
- Cash 5%
- Long time horizon? Growth-style funds are often considered by people decades from retirement.
- Buying a home soon? A lower-risk fund can reduce the chance of a fall just before you withdraw.
- Compare fees. Small fee differences compound over decades.
The government's Sorted KiwiSaver fund finder lets you compare funds by type, fees and performance.
Using KiwiSaver for your first home
Common KiwiSaver mistakes
Staying in the wrong fund
Many people never check which fund they are in. Review it every year or two, and whenever your plans change.
Missing out on government contributions
If you are eligible, contributing enough each KiwiSaver year (1 July to 30 June) can qualify you for a government contribution. Check the current rules on the Inland Revenue website.
This article is general information, not personal financial advice. Consider your own situation and, if needed, speak to a licensed adviser.