Your 5 step KiwiSaver guide

13 April 2021

KiwiSaver is a great tool to help you save for your future – whether that’s saving a deposit for your first home or setting yourself up for a comfortable retirement.

It’s important to understand that a KiwiSaver account is not like a bank account. It’s an investment account – so there’s a few things you need to do to make sure you’re getting the most out of your KiwiSaver savings. 

Not sure where to start? Don’t worry – we've got ya sorted. Here’s our super quick, jargon-free 5 step checklist to help you get your KiwiSaver account sorted!

Boost your KiwiSaver account

Setting your KiwiSaver account up to make sure you’re getting the most out of your savings doesn’t take long and could make a significant difference to your future.

To help maximise your KiwiSaver savings:

  1. Get your government contribution each year
  2. Choose your contribution rate
  3. Check your PIR rate
  4. Work out your investor profile and time horizon
  5. Choose the right investment fund for you


1. Get your government contributions

Simply put, getting your government contribution (aka GC) each year is one of the easiest ways to build up your KiwiSaver balance, fast!

Each year, for every $1 you contribute to your KiwiSaver account, the government will also contribute 50c – up to a maximum of $521.43. This means you only need to put in around $20 per week to get the full GC each year.
But it’s not ‘all or nothing’ – even if you don’t contribute the full amount of $1042.86 each year, you’ll still get a portion of your GC. Government contributions kick in once you turn 18 and end when you reach retirement age (currently 65yrs). 

2. Choose your contribution rate

It’s super easy to contribute to your KiwiSaver account. You simply contribute directly from your wages – so the money goes directly into your KiwiSaver account before you even see it. And once it’s in there – you can’t ‘accidentally’ dip into it!

Even better, you don’t have to do a thing to set this up – except choose how much you want to contribute from your wages each time you get paid.

You can choose to contribute 3%, 4%, 6%, 8% or 10% of your pay (before tax).

You contribute, your employer contributes

Did you know that if you’re working, and contributing to your KiwiSaver account, your employer contributes as well? If you’re between 18-65yrs and contributing to KiwiSaver, your employer also contributes at least 3% to your KiwiSaver account (unless they’re paying into a super scheme for you).


3. Check your PIR tax rate

Because your KiwiSaver account is an investment, you’ll pay tax on the money you earn from your KiwiSaver investment. This tax is called your Prescribed Investor Rate (PIR). Your PIR will be 10.5%, 17.5% or 28%.

You need to make sure you’re on the right PIR, so you pay the correct amount of tax each year. You can work out your PIR here. 

If you think you’re on the wrong PIR, you’ll need to update it with your KiwiSaver scheme provider.


4. Work out your investor profile and time horizon

Choosing the right investment fund for you depends on two things:

  • Your time horizon

i.e. How soon do you expect to take out some, or all, of your KiwiSaver money (eg for your first home, or retirement)? 

    • Your investor risk profile

i.e. How comfortable are you with market fluctuations (ups and downs)? 

Even if you think you might not be that comfortable with risk, you should also factor in your time horizon when choosing an investment fund. Generally, if you have a longer time horizon, you’ll most likely benefit from being in a Balanced or Growth fund. And if you’re planning on accessing your KiwiSaver savings in the next 2-5 years, you might be better suited to a Conservative fund.

Take our investor quiz to work out your risk profile and what type of investment fund might be right for you. 


5. Choose the right investment fund for you

The money you save into your KiwiSaver account is invested on your behalf. One of the ways to get your money working hard for you is to make sure you’re in the right type of investment fund.

Generally, there’s three types of investment funds:


Aims for low or moderate growth over time. Lower risk.

Time horizon: Under 5 years


Aims for steady growth over time. Moderate risk.

Time horizon: 5-10 years


Aims for high growth over time. More risk.

Time horizon: Over 10 years

Learn more about risk.

Good things take time

The key thing to remember about investing is that it takes time! While it’s a good idea to check your KiwiSaver account on a regular basis, just remember that because your money is invested, it is likely to fluctuate up and down from time to time – especially if you’re in a Growth or Aggressive fund.

The key is not to panic if you see your balance dropping every now and then – it’s all part of being an investor! Share markets fall and recover. History shows us this.

Over time, you’ll see the same in your KiwiSaver account balance. Any small dips in your balance will eventually recover and your balance will continue to steadily grow.



What does risk mean?

The word ‘risk’ sounds scary, but it isn’t! With investing, risk is often linked to achieving an expected return outcome on your investment. More risk generally means bigger returns over the long term, with some ups and downs along the way (aka market fluctuations or volatility). Lower risk usually means lower returns, with less market fluctuations or volatility.


This article is general in nature only and has not taken into consideration any individual person’s objectives or circumstances. For personalised advice, we recommend you speak with a financial adviser. All content is correct at time of publication date.


By Rachel Southby

Rachel is our Content Specialist. She loves words, coffee, books and shoes. Not necessarily in that order. She's also interested in how the power of consumer choice can lead to positive changes in business and industry.