Women retire with less than men. How can we close the gender retirement gap?

4 min read
7 July, 2022

Women are paid 9.1% less every year than men in New Zealand, according to Stats NZ.

This pay gap can snowball, having outsized effects on women’s retirement savings later in life.

What causes the gender retirement gap and what can be done to solve it?

A closer look at the gender retirement gap

A Te Ara Ahunga Ora Retirement Commission study found that the difference between a man and a woman's KiwiSaver balance is 20% on average. 

This gap is the result of a number of factors.

Women are more likely to take time out of the workforce to care for children, meaning they miss out on employer and Government KiwiSaver contributions during this time. An NZIER report for FSC member Kiwi Wealth found that the impact of motherhood on retirement savings balances in New Zealand can be as great as $318,000.


The gender pay gap, which is currently over 9% in New Zealand, also plays its part.

As a result of these factors, Kiwi women don't contribute as much to their KiwiSaver during their working lives. 

However, the problem has deeper roots than that. 

Our research has found that our wāhine:

  • don't feel as confident making financial decisions.
  • are less likely to seek financial advice.
  • rate their knowledge of risk and return lower than men do. 
  • don't feel overly prepared for retirement (62% do not feel prepared).

Alright, so we know what the problem is, and why it exists. What can we do about it?

What can we do to fix the gender retirement gap?

The gender retirement gap is a society-wide problem that will require big solutions, but there are changes we can all make to help decrease its effect on you.

Tracey Cross is a legal and business advisor and the Chair of Women in Super, a national network of women associated with the retirement savings and wider financial services industry in New Zealand. She says knowledge is power and the first step is acknowledging that the gap exists:

“To start you need to be aware of the impact motherhood and the gender pay gap can have on you … then steps can be taken to minimise these factors.”


Tracey Cross 1080 x 1080 circle

The impact of motherhood, as we mentioned earlier, can be significant. According to the NZIER report to Kiwi Wealth, women who spend a year out of employment for motherhood could end up with over $15,000 less in their KiwiSaver accounts at 65. Women who switch to part-time employment or leave paid work entirely could have $58,000 to $318,000 less. 

Tracey says that any action to put savings aside is a good action, even if it’s only a little bit:

“Having even a small amount at retirement provides an element of choice which is empowering. No matter where you are at, you can take one small action that will be of benefit to your overall financial wellbeing.”

Next, she says that talking about your finances with friends and colleagues is really powerful - this can make us realise our financial struggles are shared by others and make us feel that it’s okay to ask for help. 

Joining KiwiSaver is another positive step, and so is contributing a minimum of $1,042.86 between 1 July to 30 June each year to be eligible to receive a government contribution of $521.43 (free money!).

While there are things that women can do as individuals, Angela Meyer, Director of Project Gender, says that it's not just about individuals - the current system is unfair for women and it needs to change:

"We need to focus on system changes that prioritise the lives and experiences of women. Placing the responsibility on individual women to up their KiwiSaver balances misses the opportunity to change a system that fundamentally disadvantages them." 


Angela Meyer 1080 x 1080 circle

She adds that because KiwiSaver is tied to employment, women are automatically worse off:

“Many women are excluded from the paid workforce due to caring responsibilities. One of the easiest ways to make KiwiSaver equitable and fairer is to remove the tie with employment."

The gender pay and retirement gaps are big problems that are decades or centuries in the making - so they’ll require intergenerational solutions across all our institutions.

David Boyle, Head of Sales and Marketing at Mint Asset Management, says there are three main areas where change can start:

“One is in the home. It’s about your parents and how you’re brought up. To solve this bit we need to be supporting parents to talk to their kids about finance at an early age.”


David Boyle 1080 x 1080 circle

Next, David says we need to address the problem in schools, by focussing educational research on young girls:

“These programs need to be focused on teaching girls how to achieve financial independence, irrespective of their future relationship or personal circumstances.”

Last of all he says employees and the government need to play their part. Caregiving rightly or wrongly falls more often to females so they need support:

“1.1 million Kiwis aren’t contributing to KiwiSaver and chances are many of them are women taking time off work for caregiving. The Government or employers could keep contributions going during maternity leave - or encourage paternity leave to decrease the burden on women.”


This How can we close the gender retirement gap? blog is general information only. The views and opinions expressed do not necessarily reflect those of the FSC. It is not intended to constitute legal or financial advice and does not take your individual circumstances and financial situation into account. We encourage you to seek assistance from a trusted financial adviser, legal or other professional advice.

The names of any third parties are additional resources that you access at your own risk and the FSC takes no responsibility for any third party content. 

The FSC and its employees make no express or implied representations or give any warranties regarding this blog, and we accept no responsibility for any loss, damage, cost or expense (whether direct or indirect) incurred by you as a result of any error, omission or misrepresentation in this blog.  

7 July 2022.  



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