Record numbers of KiwiSaver withdrawals prompted by financial hardship were made in December.
Data that goes back to August 2016 shows 6030 withdrawals due to financial hardship were made in the last month of 2025 - a new high.
In total in December, KiwiSaver members made 10,320 withdrawals amounting to $248,052,313.
The 6030 withdrawals due to financial hardship, totalled $51,765,018 while 4290 withdrawals were made for first homes, totalling $196,287,295.
The data comes from Inland Revenue Department (IRD) and breaks down early withdrawals made by people buying their first homes and/or those experiencing financial hardship. KiwiSaver members can withdraw funds under both categories within the same period.
While the total withdrawal figure is high, it doesn’t surpass November, which saw the value withdrawn reach a monthly high of $255,323,171.
For the number of KiwiSaver fund withdrawals, IRD rounds up to the nearest 10.
People can withdraw money from their KiwiSaver when they reach 65, which is retirement age, but you can also apply for early withdrawals to buy your first house or because of financial hardship.
In December, there were 83,333 savings suspensions when people temporarily stop their contributions. Of those, 1103 stopped their contributions due to financial hardship.
As of December, 817,644 members had their accounts closed or chose to opt out of KiwiSaver. Of this, 628,870 members had closed their accounts, while 188,774 chose to opt out.
Members usually have their accounts closed because of death, permanently leaving the country, retirement, serious illness or other reasons.
When it came to KiwiSaver fund types, 643,438 people were in default allocated schemes, 208,102 were in employer nominated schemes and 2,569,860 had actively chosen their schemes in December.
At 754,080 the 35 to 44 age demographic had the largest number of KiwiSaver members. The 25 to 34 age category follows with 736,046 members.
During December, 4935 people became active or provisional (you have eight weeks before you can choose to opt out) KiwiSaver members. There are a total of 3,432,341 active or provisional KiwiSaver members, IRD data shows.
Election
With 2026 being an election year, KiwiSaver and retirement will be a contentious topic.
In November, the National Party released its first key election policy - that it would continue to increase contribution rates for employers and employees.
Additional increases would start from April 2029, rising by 0.5% per year until April 2032 - to a 6% contribution rate for employers and employees.
New Zealand First already announced its KiwiSaver election policy in September, proposing to increase employee and employer contributions to 10% and making KiwiSaver compulsory.
At the time, NZ First leader Winston Peters said KiwiSavers and employers would receive tax cuts to cover the increases.
Cross-party action
In November, Retirement Commissioner Jane Wrightson said decisions on whether to make KiwiSaver compulsory or whether to change the age of eligibility for NZ Super can’t be made without considering the retirement system as a whole.
Wrightson's comments came as Te Ara Ahunga Ora Retirement Commission released its Review of Retirement Income Policies 2025.
As part of the review, Wrightson called on cross-party action when it came to the retirement system.
National's policy at the last three elections has been to raise the age of superannuation - with its proposal to keep the NZ Super age at 65 until 2044, and then it will be gradually bumped to 67.
ACT also supports lifting the age to 67.
In December, Prime Minister Christopher Luxon told reporters National would have “more to say about that” but the party had a “very consistent policy in the last few elections about lifting the age from 65 to 67”.
Luxon said National was not up for changing NZ Super itself because the party wanted people to have certainty.
“We think of it as an entitlement and I just don’t want people to have any anxiety around that.”
Luxon said they constantly will be reaching out in a bipartisan way but Labour and other political parties had a “very strong aversion to lifting it from 65 to 67”.
ACT Party leader David Seymour said every other country was changing the age of entitlement to superannuation.
Seymour said people are living longer and having fewer children than taxpayers did in the 1960s for example.
“You’re going to have to have a change.”
With more older people, Seymour said these were people who have worked hard all their lives and they’re entitled to get something for what they were promised when they started their careers.
“But equally, there’s simple mathematics. People used to have nine children … Some still do but it’s rare, so therefore you’ve got fewer taxpayers. People used to die in their late 60s or early 70s.
“Now we live a whole extra 10 years on average, which is great, but it just means the amount of people drawing [out] Super and the number of taxpayers needing to pay for it has shifted, and potentially shifting the age is an important debate New Zealand has to have.”
Seymour said: “We are going to have to bite that bullet. Now if we don’t, it will be forced on us. There will be a big earthquake or a pandemic or some sort of financial crisis in the future … We’re going to have to make the change suddenly and then people will be very upset.”
Labour’s finance spokesperson Barbara Edmonds previously told interest.co.nz that Labour was committed to keeping the age of superannuation at 65.
“Beyond that, we have always been open to constructive, bipartisan work to better secure New Zealanders’ retirement incomes.”
“Let’s not forget that it was Labour who established KiwiSaver and the NZ Super Fund. In Budget 2023 Labour extended the 3% government contribution to KiwiSaver for those on parental leave, recognising the unpaid nature of childcare.”
New Zealand First also wants to keep the age of superannuation entitlement to 65. “No ifs, buts, or maybes,” its policy on seniors from 2023 said.
KiwiSaver rules
Following the 2025 Budget, changes were made to KiwiSaver.
People aged 16 and 17 are eligible for KiwiSaver so they can access employer and government contributions.
The Government’s contribution rate dropped to 25 cents for each dollar a member contributes. This was previously 50 cents for each dollar, which meant receiving a maximum government contribution of $521.43.
To get the Government’s full contribution, which is $260.72, people need to put in at least $1042.86 of their own money between July 1 to June 30 each year.
Alongside this, people with an income of more than $180,000 no longer receive the government contribution.
Employer and employee contribution rates will increase to 3.5% from April 2026. This will move to 4% in April 2028. It’s currently at 3%. KiwiSaver members can choose to stay at the current 3% rate and still be matched at this rate by their employer.
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