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Making the most of the KiwiSaver Government contribution

Maia is 20 years old. As a self-employed contractor, she isn’t required to contribute to her KiwiSaver account from her pay and she doesn’t receive any employer contributions. However, she’s keen to make the most of the other available KiwiSaver benefits, such as the annual Government contribution.

For every year that Maia contributes at least $1,042.86 to her KiwiSaver account between 1 July and 30 June, the Government will pay $521.43 to her KiwiSaver account. Because Maia is self-employed and doesn’t make employee contributions through her pay, she decides to set up a regular direct debit for $21 each week so she doesn’t have to worry about finding the money at short notice before the 30 June cut-off. Putting a small amount each week is a great way for her to achieve the $1,042.86 that she needs each year.

If Maia continues to receive the maximum Government contribution from age 20 until she is 65, the total Government contributions in her KiwiSaver account could add up to $23,000 at age 65. That’s $23,000 from the Government that she wouldn’t have otherwise received if her money was invested elsewhere.

And once you add up Maia’s own contributions and the returns she could expect from her investment, she’d have an estimated $192,000 saved by the time she turns 65 – all from contributing $21 per week from age 20.

Case study assumptions

This case study is an example to help you understand how your choices can affect your KiwiSaver savings. The figures used are for illustration only and may not reflect actual returns.

For this case study, we’ve assumed that:

  • Maia is invested in the Lifetimes option.
  • Maia receives Government contributions appropriate to her contributions and at today’s levels only.
  • Our funds achieve the following positive investment returns each year (after fees and taxes using a prescribed investor rate of 28%):
    • Conservative Fund: 2.2%
    • Conservative Balanced Fund: 3.0%
    • Balanced Fund: 3.9%
    • Balanced Growth Fund: 4.6%
    • Growth Fund: 5.4%
  • Maia’s KiwiSaver membership fee is $1.50 per month.
  • Maia’s birthday is 1 July, with projected savings calculated in July.
  • We’ve also rounded savings to the nearest $1,000 and accounted for tax on employer contributions.

ANZ New Zealand Investments Limited ('ANZ Investments') is the issuer and manager of the ANZ KiwiSaver Scheme and the ANZ Default KiwiSaver Scheme (together, the 'schemes'). Important information is available under terms & conditions. Download the guide and product disclosure statement.