What Do I Do With My KiwiSaver When I Retire?

"What should I do with my KiwiSaver when I retire" is a question for the ages. This guide, the first of its kind in New Zealand, extensively explains your options and helps you decide what is best for your everyday life.

Updated 28 September 2025

Know this first:

KiwiSaver was launched in 2007 as a voluntary, long-term savings scheme designed to help Kiwis save for retirement.
Your KiwiSaver balance is yours to draw down tax-free, given there is no capital gains tax in New Zealand (as of 31 August 2025).
This means every $1 you have in KiwiSaver is yours to do what you want with. Working out what to do with your KiwiSaver is an important decision, which can feel overwhelming.
New Zealand Superannuation (NZ Super) is a universal, government-funded pension that supports Kiwis aged 65+ in retirement. However, it often falls short of covering rising costs like housing, healthcare, and utilities. That’s where KiwiSaver, a voluntary long-term savings scheme, provides a vital boost, helping retirees afford extras and enjoy a comfortable lifestyle post-work.

To help you understand all the options available, we cover:

Important: Our trusted guide, How Much Do You Need to Retire Comfortably in New Zealand, explains what you need to know should this be of interest.

Introductory Frequently Asked Questions

Should I move my KiwiSaver to a low-risk fund once I retire?

KiwiSaver Schemes offer a range of different funds with varying degrees of risk. The lowest risk ones are designed to protect your money from significant share market events by offering 'conservative' and 'cash' funds.

The idea is that KiwiSaver's approaching retirement have built up their retirement savings nest-egg and need to protect it. Having the ability to shift into low risk options protects KiwiSavers in the five or so years leading up to retirement from a major market event that may impact their retirement savings balance right at the point when they want to access their funds.

Should every retiree be in a conservative fund?

There are two phases to consider. Phase one is the transition from working to retirement, normally covering the five years leading up to retirement, and the need to protect savings during this time. During this phase, moving to a conservative fund is generally sensible risk management in the event your retirement coincides with a market slump, which could impact your KiwiSaver balance at the very moment you want to start drawing from it.

Phase two requires investing your retirement savings in a way that allows your funds to keep growing so they last the long term. Remember, you’ll need this money to support a comfortable retirement that could last 20 years or longer. This requires a balanced investment approach that includes both growth and conservative funds.

That said, the right investment strategy in retirement will depend on the retiree. There is no 'one-fund-fits-all' given each of us has unique financial needs. Also, people are living longer, so moving everything into a 3% p.a. conservative fund forever may be short-sighted in higher inflationary times. This is especially true if growth funds average returns of 10%+ p.a. and you're unlikely to need much (or any) of your KiwiSaver balance for years to come.
What is right for you depends on your financial situation. If you’re investing to generate a reliable retirement income, investing for growth, or ideally both, you may want to hedge your bets and pick a balanced fund or a moderate fund. Our comparison guide to Balanced vs Moderate vs Growth KiwiSaver Funds explains the difference and pros and cons of each. Whatever you do, make an informed choice about how you want your KiwiSaver invested during your retirement.

What should I spend my KiwiSaver money on after withdrawing it?

If you're debt-free, then you should first consider how much you need to supplement NZ Super for everyday expenses for the length of your retirement, typically 20+ years.

Beyond covering everyday expenses, popular uses of KiwiSaver withdrawals include:

Going on a holiday
Medical treatment (to avoid the public waiting lists at DHBs)
Home improvements (new roof, recladding, new carpets etc.)
Buying a new car
Helping a family member

How much you spend and what you spend it on is entirely up to you. As long as you are over the age of 65 you don't need to ask for permission to withdraw or spend it, so the options are endless.

Equally a plan is essential; blind spending does have consequences. Retirement can run for 20+ years and 65% of adult New Zealanders underestimate their likely lifespan, 15% overestimate and only 20% get it about right (Longevity trends and their implications for the age of eligibility for New Zealand Superannuation, 2013 Review of Retirement Income Policy, Alison O'Connell).

Check out Lifetime Retirement Income’s Buckets of Money Guide for practical planning resources.

We explain the most common choices below - what is right for you may change as you get older, so please understand that no decision you make is finl.

Seven Options for Your KiwiSaver When You Retire

Our list, in no particular order, outlines everything you need to know to make the right choice for your needs, wants and everyday lifestyle.

Option 1: Withdraw money to pay off all debts (if you have any) and take the rest out in lump sums

If you're retired and still have some debts, we suggest considering the following process to help your KiwiSaver money improve your day-to-day lifestyle:

Step 1: The pay check will stop coming, so you’ll need a plan to replace it. NZ Super is a great asset, but the gap between NZ Super and what retired households are actually spending is between $44 and $940 a week (Retirement Expenditure Guidelines 2024, Massey University NZ Fin-Ed Centre). Take time to consider your income needs and how much capital you will need to set aside to generate an income to supplement NZ Super. Try the Lifetime Income calculator to get you started.
Step 2: Clear credit card debts, personal debts and any other debt that's costing you money. This is the most 'expensive' debt, so getting rid of as much of it as possible will make your income (e.g. superannuation payments) go further. You can then lower your credit card limits to reduce the risk of getting into debt again. For example, a $1,000 limit is a 'safe' amount to cover emergencies while avoiding racking up non-essential spending/debt.
Step 3: Pay down your mortgage as much as you can - the lower your ongoing costs and the more security you have as a retiree, the better.
Step 4: Put six months of essential expenses into a savings/emergency fund. While superannuation payments are designed to cover essential expenses, having a sizeable savings account will give you more freedom.

In summary, what do I need to do?

List all of your debts, everything from a mortgage to a credit card or personal loan. A popular approach is to repay the loans with the highest interest rates, reducing the amount of money you spend servicing debt. However, many people prefer to repay their mortgage as a priority for peace of mind.
Once your debts are paid off, you will know what your debt-free financial position is and can begin to plan for your income and investing needs in retirement. Following are a couple of considerations:

There is no golden rule as to how much money you need in retirement, but many financial advisers suggest around 60% of your pre-retirement income. For example, if you earned $75,000 before retirement you might need $45,000 per year in retirement, deduct NZ Super (for a couple) of say $43,000 a year and you will need to generate an extra $2,000 before tax per year from retirement savings.
Another guide suggests having a retirement savings nest egg equal to a multiple of your final annual income: 7.8x for males and 8.5x for females. For example, if in your final year of work (male) you earned $75,000, you might want retirement savings of about $585,000. If this sum was invested and drawn down over 30 years it would generate around $32,000 per year on top of NZ Super (currently $43,000 per year for couples).
The 4% rule is often cited as a method of working out how much income can be safely drawn down from your savings each year in retirement. For example, in the first year you could draw down $585,000 *4% = $23,400 to add to NZ super. In subsequent years you’d draw down the same amount, adjusted to reflect the current inflation rate. So, in this example, if in the second year inflation was 3% you would draw down $23,400 x 1.03% = $24,102. You need to be mindful that the viability of the rule, which is based on a portfolio of 60% shares and 40% bonds over 30 years, depends on your investment returns and the prevailing inflation rate, both of which are likely to change from year to year.

Option 2: Retire later (e.g. work beyond 65 and keep contributing to KiwiSaver)

Many New Zealanders don't want to retire when they turn 65 and prefer to keep active in the job market even if they scale back their hours. However, if you plan to do this, you will still receive the full pension payment to complement your wages. This is because, at the age of 65, NZ Super payments are a right regardless of whether you carry on working.

However, your employer is not legally required to keep contributing to your KiwiSaver once you turn 65. If they choose not to, it may be worth ending your own KiwiSaver contributions, given the government contribution also stops at 65.

Many New Zealanders enjoy the financial and lifestyle benefits of part-time paid employment while getting a boost from NZ Super. Also, there is less need to access KiwiSaver funds given the regular income generated.

However, if you're looking to buy big-ticket items, making sizeable withdrawals annually - for example, around 5% of the balance - moving it to a savings account is a popular approach. From there, you can spend the money as you need it while your NZ Super and wages help with everyday costs.

MoneyHub Founder Christopher Walsh comments:
"My parents are in their 70s and are highly active, and many of their friends of a similar age keep busy running businesses and volunteering. I firmly believe that retirement as a concept is misunderstood - many New Zealanders intend to keep working, albeit more on their terms. Having a regular income, superannuation payments, and the freedom to draw down KiwiSaver puts you in an incredibly strong financial position. If you're thinking about staying in the workforce, you have nothing to lose if you enjoy what you do and want to move to a part-time role. In any case, I wish you the best in this exciting chapter of your life".

In summary, what do I need to do?

Confirm with your employer if you'll be receiving a KiwiSaver contribution after you turn 65. If you do, it's worthwhile to keep contributing. If you don't, you may want to stop contributing altogether.

Make sure your tax information is correct so that your employer pays you correctly. You'll need to remind them you're receiving the NZ Super payment and make sure they tax you correctly after you turn 65.

Decide how much to withdraw from KiwiSaver. Many people 65+ in paid employment manage without making large drawdowns. To properly prepare, we suggest thinking about what you will need, when you will need it and how much it will cost. You can then see how that compares to your current KiwiSaver balance.

Option 3: Convert your KiwiSaver balance into a regular "pay check" by withdrawing it in stages.

KiwiSaver providers will support a drawdown facility from your balance until your balance has been reduced to zero. However, determining how much you can drawdown safely is complicated due to unknown variables like how long you’ll live, as well as fluctuating inflation and investment returns.
A lesser known but significant consequence of aging is cognitive decline, which can make managing your own financial drawdown increasingly challenging. While it may feel manageable at 65, by age 80, the complexities can become overwhelming. Creating a comprehensive, long-term plan is crucial for ensuring financial stability throughout retirement.
Specialists are emerging in this area to help make sure you get this right and don’t end up running out of money too soon.
Key considerations when working out your ideal drawdown rate include:

Your age and gender – you will need an accurate assessment of your remaining living years, noting females typically live longer than males. This needs to be monitored annually, because your expected lifespan changes for each additional year you live.
Inflation is your enemy – you need to be able to keep pace with inflation to ensure your future income will buy as much as it does today.
Tax is also important - this gets deducted from your investment earnings. Tax too much and you are underpaying yourself, tax too little and the penalties are eye watering.
Your personal circumstances need to be considered - for example, whether you’re single or in a couple. If you’re a couple, will your retirement income plan survive the youngest partner? And is your income plan simple enough that both partners understand it? There is no point in getting clever with how you manage your drawdown if you pass away and the surviving partner is unable to maintain the plan.
Retirees’ income needs are likely to change as they age - You may want to consider varying your income levels to suit your lifestyle over time, perdhaps higher in the early years when you’re more active, and lower in the later years.

Lifetime Retirement Income is a specialist provider of retirement income solutions and has a free calculator on its website that helps you forecast your individual retirement income based on the factors outlined above.

Our View: Preparing a sustainable long-term plan for your income in retirement is as important as saving for retirement. Taking time to consider your retirement savings balance and how much you’ll need to generate a retirement income to supplement NZ Super is a fundamental first step.

Determining your long-term retirement income needs – i.e. how much you’ll need to put aside to cover all your day-to-day expenses - should come before any subsequent retirement investment decisions.

In summary, what do I need to do?

Take time to work out how much income you will need over and above NZ Super to support the retirement lifestyle you want.
Use online calculators to work out how much of your retirement savings you will need to commit to achieve the level of income you desire.
When you have done this, you’ll know how much is left over to invest in assets not dedicated to paying you a regular income.
Make sure your income solution checks in with you every year to ensure you’re on track and it’s keeping pace with your individual aging profile.

Option 4: Keep it where it is and spend other investments

KiwiSaver is there to be spent, but you may want to run down other investments first. If this is you, you're likely in a strong financial position, and KiwiSaver won't play an integral part in your retirement. In such instances, you can carry on as usual and decide how to spend your KiwiSaver when appropriate.

In summary, what do I need to do?

Nothing. You can leave KiwiSaver where it is and carry on as normal. If you do need to buy something and don't have the money on hand, you can contact any of your investment providers and request to sell down a portion or all of it.
If you wish to take your KiwiSaver balance and invest it independently, you can withdraw some or all of your balance at any time after you turn 65. Again, you'll need to contact your KiwiSaver scheme to arrange the withdrawal.

Option 5: Take a portion and pay it to yourself fortnightly

Many New Zealanders are reluctant to spend their KiwiSaver money. Others spend it too quickly and run out early in their retirement. If you're looking to preserve your KiwiSaver for the long term, you will need to make a distribution plan and stick to it.

It's a tricky balance to strike and the best drawdown plans are re-evaluated every 12 months in line with your age and personal circumstances. The New Zealand Society of Actuaries provides some valuable guidance, which can be found here.
Using the Lifetime Retirement Income calculator and the following assumptions we have created a table of possible retirement income solutions.

Assumptions:

A couple, female aged 69, Male aged 73.
Tax rate 17.5%
Life expectancy to age 95
Adjusted for inflation
Management fees 1.35% p.a.

Retirement Savings	Fortnightly income supplement	NZ Superannuation	Total per fortnight to age 95
$200,000	$346	$1,656	$2,002
$300,000	$519	$1,656	$2,175
$400,000	$692	$1,656	$2,348
$500,000	$865	$1,656	$2,521

In summary, what do I need to do?

Work out how much income you’ll need over and above NZ superannuation to meet your living expenses in retirement.
Decide if you want to manage this yourself by drawing down your required income from your KiwiSaver account (you’ll need to contact your KiwiSaver provider to let them know how much you’d like to withdraw). Make sure you recalculate your income requirements annually to account for your age, actual investment returns and inflation, and let your KiwiSaver provider know each year the revised drawdown value.
Alternatively withdraw your KiwiSaver balance and invest in a specialist retirement income provider who will do the income calculations for you and reassess each year (during your birthday month) that the income calculation remains correct.

Conclusion and Final Thoughts

If you have debt owing, using KiwiSaver to clear the balances will likely boost your regular income as you'll save money on expensive interest costs.
If you have the ability and the interest it's relatively straightforward to calculate your annual drawdown amounts if you keep pace with your expected mortality (youngest age for a couple), investment returns and inflation. You can advise your KiwiSaver each year and manage this with automatic income payments. Note if you choose to do this yourself it needs to be sustainable for 20 plus years, and you will need to keep on top of it even into your older years.
Alternatively you can withdraw from KiwiSaver and appoint a specialist retirement income provider to do it for you (at a cost) and get on with enjoying your retirement.

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