Early KiwiSaver withdrawals during October tick over $200 million for the first month ever

Early KiwiSaver withdrawals hit almost $205 million during October, the highest monthly amount ever withdrawn in the history of the voluntary retirement savings scheme.

Between January and October 2024, 70,800 people have taken out over $1.65 billion from KiwiSaver in early withdrawals.

KiwiSaver was introduced by the Government in 2007 to help New Zealanders save for retirement. The scheme currently has 3.37 million enrolled members, according to Inland Revenue (IRD), which tracks monthly KiwiSaver statistics.

Almost 4,000 people enrolled in KiwiSaver during October.

People are generally only able to withdraw from their KiwiSaver when they reach the age of 65, which is the country’s current retirement age. However, people can apply for early KiwiSaver withdrawals on financial hardship and first home ownership grounds.

The  previous monthly record for early KiwiSaver withdrawals was in July 2024 when over $191 million was withdrawn.

IRD reported a total of 8,450 KiwiSaver members withdrew $204.8 million during the month of October.

This was made up of 4,490 people withdrawing $166.4 million for their first homes and 3,960 people withdrawing $38.4 million for financial hardship reasons. Both the home ownership withdrawal and hardship withdrawals were new record high tallies.

Home ownership withdrawals in October jumped $25.5 million compared to a month earlier in September and financial hardship withdrawals were up $2.4 million compared to September as well.

Comparing October 2024 with October 2023, first home withdrawals were up $78.5 million from a year ago and financial hardship withdrawals had risen by $16.9 million in the same period.

When it comes to demographics, the latest data shows the 25-34 age category has the largest number of KiwiSaver members with 741,553, followed by the 35-44 category which currently has 714,377 members.

By KiwiSaver scheme entry method, 655,199 members were in default allocated schemes, 212,761 were in employer nominated schemes and 2,494,977 had actively chosen their KiwiSaver scheme.

IRD also tracks the number of non-active members, people who opt out of KiwiSaver as well as those who close their accounts. The total number of non-active members came to 762,779 in October which is 4,100 more than in September.

Payments to KiwiSaver providers came to $883 million in October, which is up 17% from September’s KiwiSaver provider payments of $754 million.

The Government contributes 50 cents for every dollar a person contributes to their KiwiSaver, up to a maximum Government contribution of $521.43. 

To get the full Government contribution, people need to have contributed at least $1042.86 to their KiwiSaver between the 1st of July and 30th of June each year.

$117.6 billion

The latest quarterly KiwiSaver report out of investment research firm Morningstar report showed KiwiSaver funds under management (FUM) grew $6.8 billion to $117.6 billion during the September quarter.

According to Morningstar, the FUM increase was $3.3 billion more than during the June quarter when KiwiSaver funds rose by $3.5 billion.

Morningstar data director Greg Bunkall said multisector KiwiSaver funds had produced positive returns over the September quarter. 

ANZ still continues to be the biggest KiwiSaver provider in the country and controls 18.5% or $21.8 billion of the market.