Why is it a good idea to have a KiwiSaver?

15 January, 2024

2 mins

Lots of people ask our team if it is a good idea to have a KiwiSaver. Here are seven reasons why we think KiwiSaver is a good idea.

1. Having a KiwiSaver is a great way to save for your retirement or first home. It's invested by a licenced provider, like Pathfinder, whose goal is to grow your savings over time so they can support you once you retire.

2. Your money is safe and secure due to its government backing. In fact, your provider doesn’t even hold your money, a custodian does, for Pathfinder this is Public Trust. Find out more.

3. Having a KiwiSaver investment is like a locked piggy bank which you can’t easily get into. It’s designed to protect your savings, so you have the best chance of enjoying your retirement.

4. Leaving your money in a fund for a long period of time means it will benefit from compounding returns and because you can’t get it out, it will slowly increase over time making it an effective savings plan. See more on growing your KiwiSaver.

5. If you're between the ages of 18 and 65, for every $1 you contribute to your KiwiSaver, you will receive government contribution of 50c (up to $521 per KiwiSaver year, between the 1st of July and 30th of June). So having a KiwiSaver is a great way to get some extra savings for free from the government.

6. Once you turn 65, your KiwiSaver fund becomes like any other investment fund. Contributing to your KiwiSaver becomes completely optional. You can stop your contributions at any point, or you can continue to contribute if you would like to.

7. You can set up a KiwiSaver for a child so they can make the most of compounding returns and it’s a great way to give them a gift that keeps on growing – they will need an IRD number and you’ll need to be a legal guardian. See more on setting up an account for a minor in our FAQ’s.