KiwiSaver is a big financial asset for many New Zealanders.

While it’s a very useful tool, it can’t do everything – particularly if you don’t pay attention to it.

Here’s what to think about when it comes to KiwiSaver and what you can expect it to do for your retirement.

How significant is KiwiSaver likely to be for your retirement?

It’s possible to build up significant sums of money in KiwiSaver, particularly if you’re starting early.

For example, if you’re 20 and earning $70,000, contributing 4 percent of your salary matched by 4 percent from your employer into a growth fund, you’re on track to have saved $516,126 at 65. According to Sorted’s calculator, that may mean you could withdraw $476 a week until age 90.

If you’re starting later, or plan to withdraw money for a first home, your retirement balance may end up smaller.

For instance, if that same 20-year-old withdrew all their funds except for $1,000 at age 30 to buy a first home, they could end up with approximately $380,000 at retirement, or $350 a week – according to Sorted.

Using the same contribution rates as the previous example, if you decided to start contributing to KiwiSaver at age 40, instead of 20, you’d be on track for just under $200,000 at retirement. That could mean being able to withdraw approximately $181 a week until age 90.

Massey University recently calculated what lump sums would be needed to support households around the country, based on the current spending patterns of retirees.

The research concluded that a single-person household wanting a “choices” lifestyle anywhere in the country would need at least $250,000 saved, on top of NZ Super. A two-person household in a main centre wanting choices would need over $1 million.

What do you need?

While the Massey University guidelines provide a useful view of what retirees are currently spending their money on, every situation is different.

To work out how much you might need to have for your retirement, it can help to think about what you would like retirement life to look like.

How much travel do you want to do? What sort of hobbies might you like to pursue? What kind of lifestyle are you dreaming of? Do you think you’ll want to keep working beyond 65?

Your SHARE adviser can help you to set some goals that might help clarify your thinking. From there, you can determine what it might all cost and how much you need to save to get there.

How can you boost your retirement outcomes?

There are a number of ways that you might be able to improve your retirement nest egg..

One option that some people choose is to save more of their income.

For example, if the 20-year-old we talked about in the previous example, increased their contribution rate to 6 percent, they could potentially save $490,000 even with the same first-home withdrawal.

As your adviser, we can also help you to check that your KiwiSaver settings are appropriate for your circumstances and life stage. This should be regularly reviewed, because KiwiSaver isn’t something you can set and forget.

Another option could be to build other investments alongside your KiwiSaver. We can help you look at options that might suit your circumstances and your overall financial goals.

Ready to talk?

If you’d like a check-up on your KiwiSaver plan, get in touch with the SHARE team today. Whatever your plans for your retirement, we can help you to set clear goals and put in place a strategy to work towards achieving them.

Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.