KiwiSaver Early Withdrawals Reach $229.6 Million in April as Hardship Claims Remain Elevated

KiwiSaver members withdrew a total of $229,628,673 in early withdrawals during April 2026, highlighting the intense financial decisions New Zealanders face amidst persistent cost-of-living pressures. The total represents a combination of individuals securing their first homes and those forced to tap into long-term retirement savings as a temporary lifeline for essential bills.

Within this overall figure, 4,410 New Zealanders accessed $38.5 million from their KiwiSaver accounts due to financial hardship in April 2026. The average financial hardship withdrawal during this period was approximately $8,700 per person. While these figures represent a decrease from the record high of $296.7 million in early withdrawals documented in March 2026, when hardship withdrawals peaked at $49.2 million, the ongoing volume remains a significant concern for the wealth management sector.

First-home buyer withdrawals accounted for the vast majority of the month's total early outflow. A total of 4,220 first-home buyer withdrawals were made in April 2026, totaling $191.1 million. Despite the larger dollar amount directed towards property ownership, the volume of hardship claims is viewed by financial analysts as a critical indicator of deeper household financial stress. Hardship withdrawals are legally designated as a last resort, typically approved only after members have exhausted all other financial options.

A Decade of Rising Hardship Claims

The reliance on KiwiSaver funds for immediate financial relief has grown significantly over the scheme's history. When KiwiSaver was launched in 2007 as a dedicated retirement savings scheme, early withdrawals were expected to be rare. In 2015, annual financial hardship withdrawals across the entire country totaled $41.1 million.

By 2024, however, annual hardship withdrawals had climbed to $403.8 million. The upward trajectory escalated further in 2025, with annual financial hardship withdrawals reaching $514.8 million across 58,460 separate withdrawals. The $38.5 million in hardship withdrawals recorded in April 2026 is higher than the $37.6 million recorded in April 2025, when the number of hardship withdrawals was also lower at 4,220. This sustained increase indicates that the economic pressures on households are not abating, forcing a broader segment of the population to compromise their future retirement security.

Shifting Policy and Contributions

The persistent drawdowns on retirement assets occur alongside significant policy changes aimed at adjusting the scheme's parameters. In July 2025, the government annual contribution reduction took effect, halving the maximum co-contribution from $521.43 to $260.72 maximum. This reduction altered the savings accumulation rate for hundreds of thousands of members.