1 in 3 Kiwis have less than $500 in savings as people grapple with high costs – Westpac

Westpac data show 36% of its customers have less than $500 in savings. Photo / 123rf

More than a third of New Zealanders have a savings balance of less than $500, according to new data from Westpac.

And a breakdown of nationwide customer savings accounts showed that Aucklanders were struggling the most to put money aside.

An overview of the bank’s customer accounts found 36% of people didn’t have $500 in savings, with only a quarter (25%) making monthly automatic payments into their savings accounts.

The average Kiwi has a median savings balance of $2700, while 28% have a savings balance of more than $15,000.

Sarah Hearn, Westpac New Zealand managing director of product, sustainability and marketing, said households and businesses continue to grapple with high costs.

“Saving more money might feel unrealistic for many people right now ... but taking some time to review your overall spending and making small savings commitments can have a big impact over time.”

Hearn said while some people will be channelling any extra funds into paying off their mortgage rather than saving, the data showed 81% of Westpac home loan customers do also have a savings account, with 36% of them having set up a monthly automatic payment.

“Good savings habits can make a big difference in the long run. Simply establishing the behaviour is a great start,” she said.

Southern regions top list of best savers

Kiwis in Canterbury and Otago are the best savers in the country, according to the data.

The median savings balance of Westpac customers in both regions was $4200, while 32% of people in both regions had a savings balance of more than $15,000.

Canterbury and Otago also led the way with 28% of Westpac everyday banking customers making monthly payments into their savings.

At the other end of the table, those in Auckland had the lowest median savings balances ($1200).

Aucklanders were the most likely to have a savings balance of less than $500 – which was the case for 43% of people.

Hearn said it can be tough to get ahead in the country’s biggest city, where only 19% have an automatic savings payment set up.

“We know costs are typically higher in Auckland than in other regions and that’s reflected in this savings data.”

Northland had the second-lowest median savings balances among Westpac customers ($1400), while 42% in the region had a savings balance of less than $500.

Wellingtonians had the North Island’s highest median savings balance at $3600, while 31% had more than $15,000 in savings.

Wellington and Southland tied for first place, with 42% of Westpac customers having Westpac KiwiSaver balances of more than $40,000.

Overall, 38% of the country had a Westpac KiwiSaver balance of more than $40,000.

“It’s important to make sure you’re in the right KiwiSaver fund for your stage of life,” Hearn said.

“There are numerous simple and free online resources available to help you to work that out.”