With KiwiSaver in focus heading into November's election, early withdrawals continued in April with members taking out more than $229.6 million for first home deposits and financial hardship reasons.
The April value is lower than March, which reached a monthly high of more than $296 million.
April’s dollar value was $229,628,673 and the number of total early withdrawals was 8620. Of the 8620 early withdrawals, 4220 were for first home purchases and 4410 were for financial hardship.
By value, first home buyers took out a lot more money than those experiencing financial hardship. April withdrawals for financial hardship totalled $38.5 million, while withdrawals for first homes reached $191.1 million.
The figures come from Inland Revenue (IRD), which rounds the number of KiwiSaver fund withdrawals up to the nearest 10.
People usually 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 April, there were 83,354 savings suspensions, which is when people temporarily stop their contributions. Of those, 1128 stopped for financial hardship.
As of April, 833,223 members had their accounts closed or chose to opt out of KiwiSaver. Of this, 644,030 members had their accounts closed while 189,193 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 schemes, 640,956 people were in default allocated schemes, 207,064 were in employer nominated schemes and 2,595,755 had actively chosen their schemes in April.
At 765,460, the 35 to 44 age demographic had the largest number of KiwiSaver members. The 25 to 34 age category follows with 734,297 members.
During April, 7221 people became active or provisional (you have eight weeks before you can choose to opt out) KiwiSaver members. There are a total of 3,455,971 active or provisional KiwiSaver members, IRD data shows.
KiwiSaver and the election
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 each.
New Zealand First 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.
Last week, Peters promised to make KiwiSaver compulsory from birth, with an automatic Crown contribution of $1000.
Meanwhile Prime Minister Christopher Luxon hinted at more changes to KiwiSaver if National is governing after the election. Luxon previously told Newstalk ZB that he wanted to lift the retirement age “as soon as we get back in a second term”. But he would need Labour and NZ First to come on board when it comes to raising the age - something that is unlikely.
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