In their most recent budget, the government announced that starting from the 1st of July 2025, they are halving the government KiwiSaver contribution – from a maximum of $521.43, to $260.72.
This will negatively impact sole traders, who could see their KiwiSaver retirement fund reduced by up to 17% because of it.
We firmly believe that sole traders deserve better, all round. So we’re stepping up, and randomly selecting 500 Hnry customers to top up their KiwiSavers the $260.72 they’ll miss out on this year.
It’s a small way we can give back to our community, and let them know we have their back – and we’ll keep pushing for a better deal on their behalf.
- The KiwiSaver changes
- What the changes mean for sole traders
- The Hnry KiwiSaver Giveback
- How Hnry advocates for sole traders
The KiwiSaver Changes
In case you missed it, the government announced two major changes to KiwiSaver in their 2025 budget.
The first was that the matched employer contribution will be gradually increased from 3% to 4% over the next few years.
At the same time, the government would be halving the government KiwiSaver contribution – from $0.50 contributed for every $1 up to a max of $521.43, to $0.25 contributed per $1 up to a max of $260.72.
In order to be eligible for the updated maximum contribution, you’d still need to contribute $1,042.86 yourself. And once you hit the earnings threshold of $180,000, you’ll no longer be eligible for government contribution at all.
📖 For more information about all announced KiwiSaver changes, check out our more detailed explainer.
What the changes mean for sole traders
Right, so. Firstly, full-time sole traders don’t have an employer contributing to their KiwiSaver fund. Increasing the employer contribution percentage doesn’t benefit them at all.
The government contribution was the only incentive for them to regularly put money towards their retirement fund. Halving this effectively halves their incentive to save – and results in a significantly lower final fund when it comes time to retire. Modelling from Sorted.org.nz shows that this policy could reduce retirement savings for sole traders by up to 17%.
This policy feels like a penalty for sole traders, who actually contribute significantly to the New Zealand economy. Research shows that sole traders are the most productive business type by far, and yet remain significantly undervalued and unsupported by the government.
This KiwiSaver proposal is yet another blow for a group who don’t deserve it. While those in traditional employment stand to gain overall (the increase in contributions to 4% makes a significant difference down the line), sole traders will lose out yet again.
The Hnry KiwiSaver Giveback
What’s Hnry doing about all this? We’re stepping up into the hole the government left behind, that’s what.
We’ve randomly selected 500 Hnry customers to top up their KiwiSavers the $260.72 they miss out on under this policy.
Why are we doing this? Well, truthfully, it’s because we feel this KiwiSaver change is a raw deal for sole traders. An additional $260.72 a year, earning interest at 7% annually means an extra ~$24,000 in 30 years time. That’s a big increase!
To put it another way - the ~$130,000 we’re contributing across these 500 customers could boost the group’s collective funds by $1,000,000 by the time they retire.
We firmly believe that this is the kind of financial support sole traders need. While we’re glad to be in a position to help this time, we don’t believe private companies should need to step up to compensate for the government’s withdrawal of vital funding.
Making sure everyone can afford retirement is good for us all. Sole traders are the most productive businesses in the economy – frankly, they deserve better than this.
How Hnry advocates for sole traders
Hnry has been advocating for sole traders since we first started in 2017. We noticed that in general, sole traders were lumped together with small businesses – despite them having different ways of working and different business needs.
So we set out to do something about it. Our accounting and tax service is built with sole trader needs in mind, making tax admin so easy that our users never have to think about it again. We save sole traders time, money, and stress, helping them do more of what they love (unless what they love is sorting taxes, which it normally isn’t).
We also raise awareness about the problems sole traders face, whether that’s through bringing attention to our outdated GST threshold, or broadcasting the results of The Hnry Sole Trader Pulse, the only one of its kind. Right now, we’re working with the Retirement Commission to understand and address the challenges facing sole traders when it comes to saving for their retirement.
Making the lives of sole traders easier is what we do, and the Hnry KiwiSaver Giveback is just one way we can support the community who supports us.
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