KiwiSaver

How much goes in from each pay

From 1 April 2026 the default employee contribution rate is 3.5% of your gross pay. You can choose 3.5%, 4%, 6%, 8% or 10%. If 3.5% is more than you can manage right now, Inland Revenue lets you apply for a temporary rate reduction back to 3% for between three and twelve months, which is a formal option rather than something you have to negotiate.

Your employer must put in at least 3.5% of your gross earnings on top of your pay. That contribution is taxed before it lands, through employer superannuation contribution tax, so the amount that shows up in your account is a little less than the headline percentage. From 1 April 2026, 16 and 17 year olds qualify for employer contributions too, which they previously did not.

The government adds 25 cents for every dollar you contribute, up to a maximum of $260.72 in the KiwiSaver year that runs 1 July to 30 June. Reaching the maximum takes about $1,043 of your own money over the year. You need to be 16 to 64, mainly living in New Zealand, and earning $180,000 or less. The income cap and the 25c rate both took effect on 1 July 2025, replacing the old 50c match, so older articles quoting $521 a year are out of date.

A worked example

Take someone on $68,000 a year, paid fortnightly. This is an illustration, not a projection.

At the default 3.5%, their own contribution is $2,380 a year, or about $91.54 a fortnight out of gross pay. Their employer adds at least another $2,380 before tax on that contribution. Because they have contributed well over $1,043 during the KiwiSaver year, they also receive the full $260.72 government contribution.

So roughly $5,000 a year goes into the account, of which about half comes from someone other than them. The part that shows up in the household budget is the $91.54 a fortnight.

What people commonly get wrong

"It comes out of my take-home pay." It comes out of your gross pay, alongside PAYE. Raising your rate from 3.5% to 6% costs you less in the hand than the percentage difference suggests, because the money is deducted before tax is calculated on what is left.

"I'll get the government contribution automatically." Only if you have personally contributed enough by 30 June. People who were self-employed, on parental leave, between jobs, or on a savings suspension often fall short without noticing, and a voluntary top-up before the end of June is what closes the gap.

"My fund choice doesn't matter much." Fund type and fees compound over decades. It is not our place to tell you which fund to be in, and this is not financial advice, but the choice is worth more attention than most people give it.

"It's locked away and irrelevant to me now." The first-home withdrawal is real and widely used. After at least three years of membership you can withdraw your contributions, your employer's, the government contributions and your investment returns, leaving $1,000 in the account. Applications go through Kāinga Ora, so they need organising well before settlement day.

Where it meets your weekly budget

KiwiSaver is one of the few savings habits that works without willpower, because the money never arrives in your account to be spent. That is also why it should not appear in your budget as money you might have.

What matters day to day is the number left after KiwiSaver, PAYE, student loan, rent and bills have all taken their share. That figure is what you are actually deciding with each week, and it is what Safe to Spend is built to show.