The KiwiSaver gender-linked savings gap has stabilised year-on-year, according to a new Melville Jessup Weaver (MJW) analysis, while more retirees than ever are remaining as scheme members.
In its third annual interrogation of granulated scheme data prepared for Te Ara Ahunga Ora Retirement Commission, MJW found male scheme members have on average a quarter more saved than female counterparts – or about the same the previous report.
“The average balance for a male is 25% higher than the average balance for a female, a gap of $7,314,” the MJW study says. “While expanding in monetary terms, the ratio of the average male balance to the average female balance has remained around 25% .”
During the 2022 calendar year the gender differential in average KiwiSaver account balances increased from 20 per cent to a quarter.
Michelle Reyers, Te Ara Ahunga Ora policy lead, said in a statement: “It’s good to see the gap hasn’t widened in the past year.”
However, Reyers said more work was needed to close the gender imbalance in KiwiSaver, which primarily reflects pay male-female pay differences in NZ as highlighted in a report released by the Commission in April.
The KiwiSaver gender gap persists through cohorts, the MJW data shows, with “significantly more females than males” in the $10,000-and-below account bracket in all age groups: males dominate, too, in the $80,000 plus account balance category except for those aged over 80 where females hold a slim majority.
MJW also found a small proportional – but numerically significant – jump in the number of 65-plus KiwiSaver members.
“Approximately 180,000 members (5.5%) are aged over 65, and appear to be using KiwiSaver as an investment vehicle in their retirement,” the report says. “This is an increase on last year (165,000 and 5.4%).”
Following a 2018 law change, people aged 65-plus can now join KiwiSaver but are not eligible for the mandatory employee contribution nor the annual government ‘tax credit’ of up to almost $1,043.
Average KiwiSaver account balances rose about $4,444 year-on-year (or $5,109 for males and $4,147 for females), the MJW data reveals, to $31,823, likely as the result of “the strong recovery financial market experienced over 2023”.
In a report also published last week financial advisory firm, National Capital (owned by Saturn), estimated the gender gap between retirement age KiwiSaver balances would be in the order of billions for most age cohorts – driven both by lifetime pay differences and the aggregate conservative bent to female investment portfolios.
The MJW survey covered almost 3.3 million KiwiSaver member or 98 per cent of the total as at the end of last year, representing a year-on-year increase of 4 per cent after eight more providers supplied information for the 2023 edition.
Reyers said Te Ara Ahunga Ora would incorporate the MJW data in policy recommendations slated for release in June.