Ninety-four percent of New Zealanders agree it’s important to be financially prepared for unexpected events. Yet fewer than half — 43% — are actually saving regularly, according to the latest Kiwibank Index. That gap between intention and action is costing people real money: without a regular savings habit, even a modest $500 emergency expense can force someone into debt or dipping into long-term funds. The same research shows that 51% of Kiwis now have a specific savings goal, up 16 points from the previous year, which suggests that having a target is what turns good intentions into action.
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This article is general information only and does not constitute professional advice. For your specific situation, consult a qualified professional.
The high cost of living is the top barrier — 69% of people point to it — and food prices rose 4.6% in the past year, squeezing household budgets further. But the data also reveals something encouraging: younger New Zealanders under 30 are leading the way, with 76% having a defined savings target and 85% sticking to a budget, tied with over-60s. That suggests age and income aren’t the whole story. What separates people who build savings from those who don’t is often just a clear plan and the right account structure. Here’s what you actually need to know.
The central idea here is a savings goal — a specific, measurable target that turns vague intentions into a concrete number. The Kiwibank Index shows that having a goal is the single strongest predictor of regular saving. Without one, you’re relying on whatever is left at the end of the month, which for most people is nothing.
What I tend to notice is that the people who set a target rarely go back to not having one. It’s a switch that stays on. If you haven’t named a number yet, that’s the single move that changes the most. For more on structuring your money flow, take a look at these automatic transfer strategies for Kiwi savers.
Who Saves, Who Struggles, and Why the Gap Exists
The Kiwibank Index breaks down saving behaviour by demographic group, and the differences are stark. Nationally, 63% of people say they struggle to save. But that number jumps to 71% for women, 79% for Māori, and 82% for Pacific Peoples, compared to 55% for men. These aren’t small margins — they represent tens of thousands of households with less financial flexibility.
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| Group | % Who Struggle to Save | % With a Savings Goal |
|---|---|---|
| National average | 63% | 51% |
| Men | 55% | — |
| Women | 71% | — |
| Māori | 79% | 56% |
| Pacific Peoples | 82% | 55% |
What’s interesting is that Māori and Pacific Peoples are actually more likely than the national average to set a savings target — 56% and 55% respectively, compared to 51% overall. So the intention is there, and the goal-setting is there. The barrier is structural: higher living costs, lower median incomes, and less buffer against shocks. The same pattern shows up in the data on dipping into long-term savings: 62% of Māori and 61% of Pacific Peoples have done so in the past year, versus 48% nationally.
For under-30s, the picture is different. They’re not immune to cost-of-living pressures, but 76% have a defined savings target, and 23% are saving more than they did last year — compared to just 17% nationally. They also tie with over-60s for budget adherence at 85%. What this tells me is that the habit of saving has less to do with how much you earn and more to do with whether you’ve decided on a number and a timeline. A free budgeting app can help track that target without adding paperwork.
Four Common Savings Mistakes That Cost You Money
Saving without a specific target
The research is clear: 51% of Kiwis now have a savings goal, which means 49% don’t. Without a target, saving becomes whatever is left over — and for most people, nothing is left. The national average of 63% who struggle to save is driven largely by this lack of specificity. A goal of $5,000 for an emergency fund, broken into weekly amounts, changes the behaviour because your brain treats it as a bill rather than an option.
Dipping into long-term savings for short-term needs
Almost half of New Zealanders — 48% — have withdrawn from long-term savings (excluding KiwiSaver) in the past year to cover everyday expenses. The rate is even higher for Māori (62%) and Pacific Peoples (61%). Each time you do this, you lose compound growth and may trigger fees or tax consequences. The fix is a separate, easily accessible emergency account for the $500–$2,000 range, so long-term money stays untouched.
Not knowing what your KiwiSaver is doing
Only 47% of Kiwis are fully aware of which KiwiSaver fund they’re in and how it’s performing. The other 53% may be in a default fund that doesn’t match their age or risk tolerance. A 25-year-old in a conservative fund could miss out on decades of growth, while someone near retirement in a growth fund could face sharp losses. Checking your fund type and switching if needed takes about 15 minutes through your provider’s portal.
Overlooking the power of automatic transfers
Less than half of New Zealanders save regularly, according to the index. The ones who do often use automatic transfers that move money on payday before it can be spent. Setting up a recurring transfer to a separate savings account — even $50 a week — removes the decision fatigue that stops most people from saving. If you’re not sure where to start, a savings app with auto-transfer features can handle the timing for you.
How to Build a Savings System That Actually Works
Start with a number, not a feeling
The Kiwibank Index shows that 53% of New Zealanders prioritise long-term goals like retirement and home ownership over short-term needs. But a priority isn’t a plan. Pick a specific amount — say, $10,000 for a house deposit or $3,000 for a travel fund — and divide it by the number of weeks until you need it. That weekly figure becomes your automatic transfer amount. If $50 a week feels too tight, start with $20 and increase it when you get a pay rise or pay off a debt.
Separate your money into layers
Most people keep everything in one transaction account and wonder where it went. The index found that 68% of Kiwis could cover a $500 emergency expense, but 63% still struggle to save overall. That suggests the problem isn’t lacking the money — it’s that the money isn’t ring-fenced. Open a separate online savings account for your goal, a different one for your emergency fund, and leave your everyday account for bills and spending. The act of moving money between accounts forces you to see each layer.
Use the right account for the right purpose
The research mentions specific products like Notice Saver and Online Call accounts, which serve different time horizons. A notice saver typically offers a higher interest rate in exchange for giving advance notice before withdrawal — good for a 6-to-12-month goal. An online call account lets you access money instantly but at a variable rate — better for your emergency layer. Matching the account type to the time horizon stops you from treating long-term savings as spending money.
What’s changing — KiwiSaver and policy shifts
Support for KiwiSaver changes is strong: 83% of New Zealanders back incentives for children to open accounts, 73% support a KiwiSaver-style emergency savings scheme, and 67% support increasing employer and employee contributions. The government has already announced changes to increase employer KiwiSaver contributions, backed by 58% of businesses. If these changes go through, the minimum contribution rate could rise, which would boost long-term growth for everyone. Keep an eye on your KiwiSaver statement and adjust your personal contribution rate accordingly — even a 1% increase can make a significant difference over 20 years. For personalised guidance on structuring your savings, some people turn to a financial advice service to review their options.
Frequently Asked Questions About NZ Savings Goals
What’s a realistic first savings goal for someone on a low income? ▾
I already have a savings goal but I keep withdrawing from it. What’s wrong? ▾
Should I prioritise KiwiSaver or a regular savings account? ▾
How does the high cost of living affect my savings strategy? ▾
Can I have multiple savings goals at the same time? ▾
What if my income is irregular — how do I set a regular savings goal? ▾
The Gap Is Closing — But Only for Those Who Set a Target
The most striking number in the Kiwibank Index isn’t the 94% who know saving matters. It’s the 16-point jump in the number of Kiwis who now have a specific savings goal — from roughly 35% to 51% in one year. That shift is changing behaviour at scale. People with a goal are saving more, dipping into long-term savings less, and reporting higher financial confidence. The data suggests that the next year will see even more Kiwis cross that line, especially as mortgage rates fall and inflation stays within the Reserve Bank’s target band. The question is whether you’ll be one of them. Setting a number today — any number — is the move that makes everything else easier.
Remember: this article is general information only. For advice on your specific situation, speak to a qualified professional.
If this was useful, you might also want to read Top Strategies for Saving on Your Emergency Fund in NZ.
Sources and Further Reading
Boost Your Savings With Automatic Transfers in New Zealand — A practical guide to setting up the automated systems that turn a savings goal into a habit.
The Truth About Savings: Dispelling Common Myths for New Zealanders — Debunks the misconceptions that stop people from building effective savings habits.
Kiwibank (2025). Kiwibank Index Reveals Growing Consumer and Business Savings Momentum Amid Cost of Living Pressures. 🔗
Reserve Bank of New Zealand (2025). Retail spending and inflation data. 🔗
