The majority of retirees have yet to decide if they will take their money out of KiwiSaver when they become eligible, according to a survey by Gareth Morgan KiwiSaver.

The Kiwibank-owned provider questioned 2600 people who will be able to take their money out this year and found 20 per cent intended to either partially or fully withdraw their money and a further 20 per cent would continue to add to their savings.

The remaining 60 per cent said they would either do nothing or had not decided what to do yet.

The first savers became eligible to take their money out on July 1. About 75,000 people meet the criteria by being in the scheme for five years and aged over 65 in the next year.


Gareth Morgan Investments director Andrew Gawith said he expected the number of people withdrawing their money to be higher than 20 per cent. "The 60 per cent of members who haven't decided - some of them will fall into the withdrawing camp."

A recent survey of 600 people by GrownUps website - a community website for the over-50s - revealed 46 per cent of respondents planned to take their money out of KiwiSaver as soon as they turned 65 and became eligible.

Gawith said investors did not have to take all of their money out and he expected some people to keep contributing at the same rate if they were still working.

Those who are eligible to get their money out no longer get the Government contribution and employers do not have to keep contributing either.

Gawith said some savers were also planning to add other money to their KiwiSaver fund such as other superannuation money or endowments.

"We see a consolidation of savings into KiwiSaver."

Gawith said KiwiSaver was a cheap and flexible way to manage retirement savings. Each scheme has different rules about how much can be withdrawn in a regular payment but most start at either $50 or $100. Gawith said balances in KiwiSaver were still small and he expected many savers to treat the money as a bonus rather than core retirement savings.

Gareth Morgan Investments has launched a cash plus investment option targeting over 65s who want to keep their money in KiwiSaver but take a conservative investment approach.