Here's a stat that stopped us in our tracks: according to Inland Revenue's own data, in July 2026, 5,110 people withdrew money from KiwiSaver due to significant financial hardship. Only 4,660 withdrew for a first home purchase in the same month. Across the 2024–25 financial year, it was 45,870 hardship withdrawals to 43,600 for first homes.

For the first time, more Kiwis are breaking into their KiwiSaver plan to get through hardship than to buy a house.

What that number is really telling us

A significant financial hardship withdrawal isn't an easy button. It's specifically for people who genuinely cannot meet minimum living costs or mortgage payments, and it's meant to be an absolute last resort, therefore the process is deliberately rigorous. So, when more people are clearing that bar than are hitting the milestone of a first home, it's not a sign people are careless with money. It's a sign of how much pressure a lot of households are quietly under right now.

And the numbers back that up. Annual inflation climbed to 4.1% in the June 2026 quarter - its highest level in over two years - driven largely by sharp rises in fuel, electricity, and food costs, with petrol up more than 25% over the year and household power bills up over 12%. At the same time, unemployment reached 5.6%, its highest level in more than a decade.

What does that look like in real life? It’s the petrol that costs noticeably more to fill up, a power bill that's harder to cover, and for a growing number of households, someone out of work altogether. When rent, groceries, and power are all pulling harder on the same pay cheque, it's not surprising that more people are reaching the point where a hardship withdrawal starts to look like the only option left.

We hear this from our own team too - the people who process these applications see, up close, how stretched and stressed people already are by the time they reach out. It's a genuinely tough process on both sides, precisely because what's behind it is real financial strain.

There's a longer-term cost that's easy to lose sight of in the moment. Every dollar withdrawn under hardship stops growing for retirement permanently, not temporarily. Our team also sees some people come back for a second or even third hardship withdrawal over time, and each one chips further into a balance that doesn't get rebuilt on its own. That's a heavier hit for someone in their late 50s or 60s, with little time left for it to recover, than for someone decades out from retirement.

It's an understandable decision under real pressure. But it's a withdrawal from your future, not just your present, and without a plan to rebuild it that gap doesn't close on its own - it just shows up later, at retirement.

Why we're bringing this up ahead of Mental Health Awareness Week (23–29 September)

Money stress is mental load, even when it doesn't get talked about that way. It shows up as sleeplessness, as avoidance, as short tempers, long before anyone calls it "financial stress" out loud. And it tends to get carried alone because money is still one of the few things people feel genuinely awkward bringing up, even with people close to them.

This week is about reconnecting with the people who support you. That includes the money stuff. Not because talking about it fixes the underlying pressure, but because carrying financial worry in silence tends to make it heavier than it needs to be, and isolation is its own risk to wellbeing on top of whatever the actual money problem is.

Mental Health Awareness Week runs from 23 to 29 September. If any of this feels close to home, that's worth saying out loud to someone before things get tighter, not after.

Sorted.org.nz has free tools if you want a clearer picture of where things stand, but you don't need a plan ready before you bring it up. Tell a partner the mortgage is stretched. Tell a mate the power bill's doing your head in. Just say the thing. Sometimes it's just one honest sentence to one person. This week's as good a week as any to say it.

Sources:

Inland Revenue, Statistics on KiwiSaver fund withdrawals, by number: https://www.ird.govt.nz/about-us/tax-statistics/kiwisaver/withdrawals/number

Stats NZ Consumers Price Index, June 2026 quarter, as reported by 1News/Interest.co.nz: https://www.interest.co.nz/news/71316/statistics-nz-reports-unemployment-rate-fell-56-june-quarter-after-fall-participation-rat

Radio New Zealand, Unemployment rises to 11 year high of 5.6%: https://www.rnz.co.nz/news/business/892951/unemployment-rises-to-11-year-high-of-5-point-6-percent 

1News, NZ's unemployment rate hits 11-year high in June quarter, citing Stats NZ's Household Labour Force Survey: https://www.1news.co.nz/2026/08/05/nzs-unemployment-rate-hits-11-year-high-in-june-quarter/

*This content is for informational purposes and should not be considered financial advice. Before making any financial decisions, consider consulting a financial adviser. Kōura Wealth Limited is the issuer and manager of the Kōura KiwiSaver Scheme. A copy of the Product Disclosure Statement is available at kourawealth.co.nz/pds