KiwiSaver balances 20% lower for women, report finds

The average KiwiSaver balance for women is 20% lower across all age groups, according to a new report by NZIER and Kiwi Wealth which recommends a number of changes.

KiwiSaver equity for women: Building long-term financial wellbeing, released by the economic researcher and KiwiSaver provider this morning, found the gender gap could leave women as much as $318,000 worse off in retirement. 

The report said the labour force participation gap, the pay equity gap, career gaps and changes due to motherhood, and self-reported low confidence and knowledge associated with KiwiSaver, were behind the outcome.

The impact of a one-year break in contributions due to maternity leave on KiwiSaver balances at age 65 was estimated to be $15,100, with an overall effect of between $58,000 and $318,000 if motherhood leads to part-time work or leaving the labour force. 

Kiwi Wealth said it commissioned the report to generate a clear picture of retirement savings in Aotearoa by gender and to present recommendations to policymakers and the industry.

NZIER principal economist Christina Leung, who prepared the report with fellow principal economist Michael Bealing, said the report coincides with the 15-year review of KiwiSaver by the Ministry of Business (MBIE) and was intended to assist policy-makers by exploring and providing opportunities to get more equitable settings in place.

“The drivers of KiwiSaver inequity are well understood, and it is clear that more can be done to improve equity in KiwiSaver outcomes for women. Failure to act would be detrimental to the long-term wellbeing of women in New Zealand,” Leung said.


Recommendations made in the report for businesses included that the employer continue to make KiwiSaver contributions while the employee was on maternity leave. It recommended to assess and report gender pay gaps and biases within the business and work to eliminate them, and to employ more women.

It found that pay equity would increase contributions for a woman working full-time on the median wage by between 8.1% and 9% and that the cost to employers of continuing payments on behalf of employees would be $4,383.60, assuming the government still pays its contributions. 

Kiwi Wealth chief executive Rhiannon McKinnon said the company had known for some time that part of the gender gap in savings was driven by a gap in investment confidence, even though women are generally in charge of household expenditure and are as good at financial decision-making as men.

“Unfortunately, that lower confidence means women are significantly less likely to be happy in their lives at present and significantly more likely to be stressed about their ability to retire.

NZIER principal economist Christina Leung.

“We need to move the dial, and this pervasive issue has fuelled our backing of more independent research and analysis such as this report, and our education drive targeting girls and women, because knowledge increases confidence and engagement.”

Recommendations for Government included introducing legislation requiring gender pay gap reporting and pay transparency, developing a policy for KiwiSaver contributions for parents of any gender caring for children or other dependants, partnering with KiwiSaver providers and requiring transparency over what age/sex groups are in which fund types so women can understand potential relative returns. 

Further research was recommended into KiwiSaver equity across ethnicities and the implications of relationship breakdown. 

Pay equity

In releasing the report, McKinnon acknowledged Kiwi Wealth had a pay equity gap of 28% driven by high-paying jobs in the male-dominated fields of investment management and tech. 

“We are taking the solutions presented in the report and applying them in our business. For instance, we have updated our parental leave policy so employees can continue their KiwiSaver contribution while on leave. We have identified the gender pay equity gap in our business and will work to eliminate this just as we have our pay parity gap.

“In terms of employing women, my own appointment reflects the company’s culture, and we are 50/50 across the organisation and 60/40 male/female in the top three tiers. We are working hard to attract more women into our investment management team, and are succeeding, which involves investing in professional development from a junior level because there are relatively few senior women in our industry.”

McKinnon said commissioning and sharing the research was without criticism of the government, which she credited for the “extraordinary success” of KiwiSaver, but said it needed to evolve as pressures continued to increase on the sustainability of national superannuation funding. 

“We know this is also the Government’s position, with the Ministry of Business, Innovation and Employment currently conducting a comprehensive review of KiwiSaver’s policy settings, with a focus on equity.

“The first significant review of KiwiSaver policy settings in its history is an important opportunity to put in place more equitable policy that will close this gap and help more Kiwi, regardless of gender, enjoy a brighter financial future. Our goal in commissioning this report was to contribute independent analysis around gender equity in KiwiSaver, and we are sharing the findings and recommendations widely.”

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