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In financially stressful times, our minds quickly run to those piles of money in KiwiSaver. Whether it’s rising prices and the economy in a tight spot or a personal situation costing you more, it’s natural to think about tapping into your KiwiSaver to get through.

Here are the pros and cons of hardship withdrawals as you weigh your options.


Can you withdraw money from KiwiSaver early?

Yes and no. KiwiSaver is there for long-term investing – to help you buy your first home or fund your retirement when you reach 65. It’s not for withdrawing it whenever you want (otherwise there wouldn’t be much for the long term).

But there are circumstances where you can access the money, such as applying under the significant financial hardship option.

In this guide

Withdrawing your KiwiSaver money has long-term effects

“I’m dealing with redundancy, I’ve got people depending on me, I’m just trying to meet personal expenses – that’s what hardship withdrawals are meant to be for, right?”

Definitely. But you want to make sure you exhaust all your other options first. It needs to be a last resort.

Withdrawing now is a big deal, because you miss out on the money that would be yours if you stayed in KiwiSaver. Tens of thousands of dollars could be at stake. (See below.)

So it’s important to not run and do anything hasty. No fear-based, rushed decisions, please.

These days there are all sorts of help you can look at before you need to apply for a hardship withdrawal. Use your support system first.

Get advice before you withdraw your KiwiSaver

Often there are alternatives out there we don’t even know about, but because our KiwiSaver fund is our money, we turn there naturally. But ideally you want to understand all the options and make a good choice.

The MoneyTalks helpline gives you access to expert financial mentors via live chat, phone, email or text:, 0800 345 123, or text 4029. You can even speak with them anonymously.

Your lenders and banks will want to help

Remember that banks and other financial service providers are willing to work with customers who are struggling financially. This could be by restructuring loans or giving access to short-term credit, for example.

You have a legal right to ask for changes to your loan repayments when you are experiencing unforeseen hardship.

Another option: no-interest and low-interest loans

Good Loans is run by Good Shepherd, and these types of loans can even be used for bills and debt to get through, and even by migrant workers. They are a great alternative to high-interest payday loans, for instance.

Here are more options for financial help.

Government support is available

The government has a number of relief systems in place to help us through a crisis. If you’ve lost your job, can’t work at the moment or your income has fallen, you may be able to get a benefit or some other financial help from Work and Income.

If you’re struggling to meet living costs or had an unexpected bill, they may be able to help you, even if you’re working. Find more information about financial support from Work and Income or call 0800 779 997 (8am–1am, 7 days a week).

How big a deal is it to withdraw from KiwiSaver?

When you’re looking at how much to withdraw, you can run your numbers using our KiwiSaver calculator to see how it affects your long-term prospects. Enter your current balance, see what you’re on track to achieve, and then reduce your balance by the amount you want to withdraw. Your final figure will reduce significantly.

To give an idea, let’s say you’re 35 years old and have $22,000 in a KiwiSaver growth fund. If you withdrew $20,000 now, by age 65 you would end up having $74,000 less! That’s a lot to walk away from (and even when you adjust for the effects of inflation over that 30 years at 2%, it would still be $41,000 less).

Fraudsters aim to exploit KiwiSaver withdrawals

If you’re aiming to withdraw funds from your KiwiSaver to give to someone else, particularly someone you’ve never met in person, make sure you’re not the target of a scam.

Money brings out the worst in some people, and there are frauds out there exploiting the KiwiSaver hardship process. Keep your funds safe!


You are generally able to withdraw your KiwiSaver savings if you are experiencing financial hardship. This means you are not able to pay your essential living expenses or your mortgage, suffer from serious illness, or have to pay for medical treatment. It can even be for funeral costs in some cases.

The key thing to know is that significant hardship is for when you are unable to meet everyday expenses like food or shelter. But hardship withdrawals are not to pay any of the following:

  • Credit card debt
  • Fines or infringement notices
  • Debt collection agency bills
  • Hire purchase debt for non-essential living expenses
  • Holidays
  • Travel to visit a sick relative.

You generally can’t take out any government money that has gone into your KiwiSaver for hardship, so you’d only be able to take out money from your contributions, your employer’s and your investment returns.

You may only be able to take out a specific amount.

After you’ve pursued all your options, contact your KiwiSaver provider directly to apply (or if you’ve been in KiwiSaver for less than three months, contact Inland Revenue). Your provider will take in your application and refer it to their supervisor, which is a separate company whose job it is to protect your KiwiSaver money. They approve your application if it fits the criteria.

Withdrawing from your KiwiSaver is a big decision and will shape your future in one way or another, so you want to be sure it’s a smart choice!

KiwiSaver is designed for two things: buying a first home and growing a nest egg for retirement. When times get tough, you can withdraw to keep food on the table and pay your living expenses. But typically it's not for repaying debt like credit cards, fines or infringement notices, debt collection agency bills, hire purchase debt for non-essential living expenses, holidays, or even travel to visit a sick relative.

No. When you take out your KiwiSaver money, either for a first home, financial hardship, or to use to live on in retirement, that money is tax-free. Your KiwiSaver contributions are made after your income has been taxed, and the gains from your investments that you own in KiwiSaver are taxed as well. But when you withdraw for a first home or retirement at age 65, there is no tax to pay. It's your money to use. To withdraw your KiwiSaver money, contact your provider directly.

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Financial support is available

Before you make a KiwiSaver hardship withdrawal, take a look at what other support options are available.

Find support

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