More than half of over 65 year olds in KiwiSaver are leaving it there - debunking theories that once we can get out hands on the money we will spend it up large.

Data provided by a number of KiwiSaver providers to the Commission for Financial Capability (CFFC) showed 62 per cent had made no withdrawals from their retirement savings despite hitting the age of eligibility.

At 65 people in KiwiSaver can withdraw all their money provided they have been in the scheme for at least five years.

But the research showed just 29 per cent had taken all their money out.

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A further 8 per cent had taken occasional lump sums and just 1 per cent had made regular withdrawals.

Of those who had taken the money out 46 per cent planned to put it in the bank either on call or in a term deposit.

Another 18 per cent planned to use it to pay off debt or a mortgage, 15 per cent were going to make a big purchase with the money and 12 per cent were going to travel with it.

And it appears Kiwis aren't alone in taking that approach.

Jeremy Cooper, chairman of Australia's largest annuities provider Challenger, told attendees at a forum on "decumulation" held by the commission last month that research showed Australian retirees were not blowing their money.

"They are hoarding it because they fear running out."

He said Australia's superannuation system was good for building up savings but was not built for providing a retirement income.

In your mid-60s you are handed the largest amount of money an ordinary person is ever given and asked to make future calculations about inflation, about life expectancy...

"We are all sold a bit of a pup."

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He said defined contribution schemes like Australian super and New Zealand's KiwiSaver scheme took people to the "cliff edge" but provided little in the way of help once they got there.

"In your mid-60s you are handed the largest amount of money an ordinary person is ever given and asked to make future calculations about inflation, about life expectancy... at a time in our lives when people's risk aversion dramatically shifts from when you are working to not."

Australian research showed the average superannuation balance for a household in their early 60s was now A$425,000.

But there was also a growing number of people reaching retirement with a mortgage - 30 per cent of retirees had a mortgage up from 20 per cent 20 years ago.

Cooper said decumulation - or how to get people to pay themselves an income in retirement - was the number one problem for Australia's A$3 trillion superannuation industry at the moment.

KiwiSaver balances are much smaller than Australian balances with the average now around $10,000.

The commission is looking at decumulation as part of its three-yearly review of retirement income policy.

David Boyle, group manager of investor education for CFFC, said as KiwiSaver balances grew New Zealand needed to ensure there were a range of income options for people.