KiwiSaver revealed to be Kiwis' preferred form of saving - FSC urges protection of the scheme's integrity

The Financial Services Council (FSC)’s latest Financial Resilience Index - an annual tracker measuring the financial confidence and wellbeing of New Zealanders - reveals that 81% of New Zealanders have a KiwiSaver account, compared to just 43% who hold cash savings such as term deposits.

With KiwiSaver surpassing $100 billion in funds under management in 2024, the Government has begun exploring opportunities for KiwiSaver to play a greater role in capital market investment. The FSC welcomed recent comments by Minister of Finance, Hon Nicola Willis, who expressed support for reviewing KiwiSaver settings*.

“KiwiSaver is the primary investment and retirement vehicle for New Zealanders,” says FSC CEO Kirk Hope. Our latest Financial Resilience Index research shows that 56% of New Zealanders, which is more than half the population, do not feel prepared for retirement.”

“KiwiSaver represents the best opportunity to deliver a dignified retirement and strong financial outcomes. It is critical that we get the settings right today to see the long-term benefits tomorrow. This view is echoed by Te Ara Ahunga Ora, Retirement Commission’s latest KiwiSaver report**.”

Mr. Hope noted that even small policy changes, such as reviewing contribution rates and enrolment settings, could have a significant impact on long-term retirement outcomes for New Zealanders.

He also acknowledged the challenges of the current investment environment, which has seen KiwiSaver balances drop.

“As with all investments, markets fluctuate. It’s important for New Zealanders to understand that current balances reflect a moment in time. The key is to stay focused on the long-term purpose of KiwiSaver - benefiting from consistent investment over time to support retirement,” said Mr. Hope.

“KiwiSaver is an essential component of financial security for New Zealanders, fulfilling its purpose of retirement preparedness and ensuring long-term financial wellbeing.”

“Any consideration of cutting KiwiSaver contributions risks undermining this critical tool. We ask decisionmakers to consider the financial resilience of our communities, and to work with the KiwiSaver sector to protect the integrity of KiwiSaver for the benefit of all,” concluded Mr. Hope.

The FSC looks forward to continued collaboration with the Government and relevant agencies to further evolve and strengthen the KiwiSaver system.

The FSC Financial Resilience Index 2025 can be downloaded here.

ENDS

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Notes

* Nicola Willis mulls upping KiwiSaver contributions, New Zealand Herald, March 2025
**Te Ara Ahunga Ora, The Retirement Commission, March 2025