The three age bands that matter
| Age | Can join? | Employer contributions | Government contribution |
|---|---|---|---|
| Under 16 | Yes (parent/guardian signs up) | No | No |
| 16–17 | Yes, in their own right | Yes — 3.5% since 1 April 2026 | Yes — up to $260.72 |
| 18+ | Yes, and auto-enrolled in most jobs | Yes — 3.5% (4% from 1 April 2028) | Yes — up to $260.72 |
Two recent changes make 16 a genuinely valuable birthday: from 1 July 2025, 16- and 17-year-olds became eligible for the government contribution, and from 1 April 2026 their employers must contribute 3.5% of their pay. A 16-year-old working part-time at $20 an hour for 15 hours a week now gets roughly $54.60 a fortnight from their employer, plus a 25% top-up on their own contributions.
Can you start KiwiSaver for a child under 16?
Yes. A parent or guardian can open an account for a child under 16 with any KiwiSaver provider. The mechanics:
- Choose a provider and fund — for a child with a 50-year horizon, a growth or high-growth fund is normally appropriate.
- Apply through the provider with the child's IRD number and the parent's identification. Children need an IRD number; getting one is free through IRD.
- Contribute by automatic payment — even $10 a week compounds meaningfully over 50 years.
- The account is the child's, legally. It cannot be cashed in by the parent, and at 18 the child takes control.
What $10 a week from birth is worth
| Contribution | Balance at 18 (5% net) | If left to 65 (5% net) |
|---|---|---|
| $10/week from birth | ~$15,200 | ~$350,000 |
| $20/week from birth | ~$30,400 | ~$700,000 |
| $50/week from age 15 to 18 | ~$8,200 | ~$40,000 if left alone* |
*Assumes no further contributions; the balance keeps compounding untouched. Time in the market, not the amount, is the dominant factor — which is why an under-16 account started at birth is the cheapest head start available.
Key rules parents need to know
- No employer contribution for under-16s. Your own contributions are the whole balance unless the child also works.
- No government contribution for under-16s. The 25-cent match starts at 16.
- Withdrawals: under-16 accounts are locked in the same way as adult accounts. A parent cannot withdraw the money for general spending — only through the standard first-home, hardship or serious-illness routes.
- Opting out is not available for under-16s in the same way as new employees; the account simply continues.
- The money is not counted as the parents' asset for most purposes — it belongs to the child.
Practical setup checklist
- Get the child an IRD number (apply online through IRD, allow 10 working days).
- Open the account with a low-fee provider — a 0.25% index fund versus a 1.25% active fund is roughly $15,000 of difference on a $350,000 balance.
- Choose a growth fund and set an automatic payment you will not notice.
- Record the login details somewhere the child will find them at 18 — funded accounts are frequently forgotten for years.
Deep dive — 2026 update
Choosing a fund for a 50-year horizon
A child's account has the longest investment horizon in the household, which makes the fund choice simple and the fee choice critical:
- Fund type: growth or high-growth. There is no withdrawal planned before adulthood, and a market fall in year 4 is irrelevant if the money is untouched for 50 years.
- Fees: choose a provider with no flat administration fee while the balance is small. A $36 annual admin charge on a $500 balance is 7% a year — the single fastest way to destroy a child's head start.
- Provider type: a low-cost index fund at roughly 0.25% leaves about $15,000 more on a $350,000 balance than a fund charging 1.25%.
- Life-cycle option: some providers' life-cycle funds automatically de-risk as the child approaches the fund's target date. Check what the target date is — a fund set for age 65 is fine, a fund set for age 18 is not what you want for retirement savings.
What changes when they turn 18
- Control transfers to them. The account is legally theirs from the start, but at 18 they can log in, change the fund, change the contribution rate or withdraw under the standard rules.
- If they start a job, they are auto-enrolled and their employer must contribute 3.5% (4% from 1 April 2028) — the family contribution effectively doubles.
- The government contribution of up to $260.72 becomes available from 16, but only if they contribute $1,042.86 themselves in the year to 30 June.
- Nothing forces them to stay. They can take a savings suspension after 12 months of membership, or opt out only in the first 13 weeks of a new job.
Four mistakes parents make
- Starting at 15 instead of 0. Fifteen years of compounding on a small balance is worth more than doubling contributions later — $10 a week from birth is roughly $15,200 by 18.
- Choosing the bank's default fund because it is familiar. Familiarity is not a fee strategy; bank funds commonly charge 0.49%–0.85%.
- Forgetting the account exists. Write the provider name and login somewhere the child will find it. Many accounts sit forgotten in cash funds for a decade.
- Contributing irregularly. An automatic payment of $10–$20 a week beats occasional lump sums, because the money goes in before it gets spent.
One more thing worth doing at 16: help them check their PIR. A teenager who starts working part-time is usually on the 10.5% rate — if the provider keeps them at 28% by default, they lose a large share of their returns silently.