How ‘perception gap’ holds back Kiwi finances

2 min read
14 February, 2024

New research from the Financial Services Council (FSC) has shown that 82% of Kiwis are confident making financial decisions but just 62% have a good understanding of financial concepts.

In other words, Kiwis are confident in their finances and are making money decisions without full knowledge of the implications they might have. This ‘perception gap’ may partly explain why New Zealand is one of the most under-insured countries in the OECD, and why many struggle to save enough for retirement. 

What the research showed us

For the research, the FSC quizzed a number of Kiwis on their financial confidence then tested them by asking four questions about financial concepts. Interestingly, the ‘confident’ respondents answered incorrectly more often than the respondents who weren’t as confident. 

The research also proved that overall financial literacy improves with age. In fact, of those 29 years and below just 20% answered all four questions correctly, whereas of those 60 years and older 56% answered all questions correctly. 

Bridging the perception gap


Overconfidence can be dangerous when it comes to your finances, and may lead Kiwis to forego insurance, make overly risky investment decisions, or not seek help when they need to.

Under confidence can be equally dangerous and may mean that people avoid investment and financial planning altogether, to the detriment of their own success with money. 

The FSC’s goal with its research is ultimately to improve financial literacy and confidence so that Kiwis can:

  • Better manage their finances and seek advice.
  • Better manage and understand their risk.
  • Have a dignified retirement.
  • Have accessible and affordable healthcare.

How you can improve your financial literacy and confidence 

There are free and paid resources available for all Kiwis looking to start or continue on their money journey.

Free resources include sites like Sorted and MoneyTalks, which also provides free budgeting and debt help. For more specialised help, there are services such as Debtfix, or Good Shepherd which support women. 

A registered professional financial adviser is a great option to receive in-depth advice for your situation, and they can create plans to help you to achieve your financial goals - check out our article on finding help. 



This ‘How 'perception gap' holds back Kiwi finances’ 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 registered 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.  

February 2024. 


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