KiwiSaver in 2026: what changed and what to choose

From 1 April 2026 the default employee and employer rate rises from 3% to 3.5% (heading to 4% in 2028), and the government contribution has been halved. Here is what it means for your pay and your balance.

Your contribution

You can choose 3%, 3.5%, 4%, 6%, 8% or 10% of gross pay. On a $70,000 salary the new 3.5% default costs $2,450 a year from your take-home; see the exact effect at $70,000. You can apply for a temporary rate reduction to 3%, or take a savings suspension if needed.

The employer match, and the tax on it

Employers must match at least 3.5% for contributing members. It arrives net of ESCT (employer superannuation contribution tax) at your marginal-band rate, between 10.5% and 39%. On $70,000 the match falls in the 30% ESCT band, so it adds about $1,715 to your fund, not the headline $2,450. Some employment agreements offset the match against gross pay ("total remuneration"), worth checking before you negotiate.

Government contribution

Now 25 cents per dollar you contribute, capped at $260.72 a year, and no longer paid above $180,000 income. To collect the maximum you need $1,042.86 of your own contributions by 30 June, automatic for most full-time workers, but part-timers and the self-employed should check.

Choosing your rate

The match makes the first 3.5% unbeatable: it is an instant ~100% return (less ESCT). Beyond that, higher KiwiSaver rates compete with paying down debt or investing outside the scheme, where money is not locked until 65 (or first-home withdrawal). A common approach: contribute enough for the full match and government contribution, invest the rest flexibly.

Compare any rate's effect on your take-home in the PAYE calculator.

Frequently asked questions

Sources: IRD KiwiSaver rates from 1 April 2026; Budget 2025 changes. Last updated 2026-11-04.