Many New Zealanders are now working well past 65 years, but even if they are contributing to KiwiSaver, their employers
currently have no obligation to match their contributions. Martin Hawes, one of the county’s best-known experts on
personal finance, believes this needs to change.
“It’s simply outrageous that employers are not obliged to contribute to their employee’s KiwiSaver fund after they reach
65 years. Many people are still working well into their late 60s and even 70s and their employer contributions ought to
continue.
Effectively, on their 65th birthday workers may legally receive the unwelcome gift of a 3% pay cut while performing the
same job.”
While some people choose to continue to work past the traditional retirement age because they enjoy their job, others
need to keep earning to support their current lifestyle and to continue to save for their retirement. Both groups should
continue to receive employer contributions as a matter of right. Almost a quarter of New Zealanders aged 65+ are still in work – one of the highest rates in the world.
Martin points out that while many employers do voluntarily continue to contribute to their employee’s KiwiSaver fund,
the fact that it is not required is an anomaly that should be addressed.
This comes at a time when new figures from the ANZ - the country's largest KiwiSaver provider - show average balances for 65-year-olds in 2022 are just under $50,000,
well short of the amount recommended by many experts for a “comfortable” retirement. As KiwiSaver was only introduced in
2007 many people in their 60s have not had enough time to build a large amount of savings.
Hawes notes that while $50,000 is the average amount accumulated, there will be people who have larger amounts, perhaps
more than $250,000 saved and others with less than $10,000. Some may also have savings or investments outside of
KiwiSaver. He points out that any extra amount of money saved at this stage is beneficial to someone in retirement and
even a small amount can positively impact their lifestyle.
There are also a number of other things you can do to create a regular income in retirement from scaling back your
lifestyle to downsizing your home which he explores in his book Cracking Open the Nest Egg (Upstart Press).
“Retirement can be a scary time and the number one concern people have is whether they have enough and that their money
will last. Putting in place a plan for creating a predictable income can relieve a lot of that pressure”.