Fewer sole traders plan to contribute to KiwiSaver this year after the Government halved its annual contribution; a move Hnry says is deepening inequality between employees and the self-employed.

The Budget 2025 change halved the Government’s maximum contribution from $521.43 to $260.72, helping to reduce government spending by $2.5 billion over the next four years. However, for the country’s 400,000 sole traders, who don’t receive employer top-ups, it’s their only incentive to save into KiwiSaver - and this change is already having a negative impact.

New data from Hnry’s October Sole Trader Pulse shows fewer than half (46 per cent) of sole traders intend to contribute to KiwiSaver in the year ahead, down from 50 per cent last quarter. Almost a third (28 per cent) say they’ve cut contributions directly because of the reduced Government match - up from 24 per cent in June.

Hnry CEO James Fuller says the results expose how the KiwiSaver system continues to overlook the self-employed and evolving nature of work in New Zealand.

“Only 4 per cent of sole traders believe KiwiSaver is made for them, compared to 61 per cent who see it as designed more for full-time employees. In some industries and professions, particularly in health, where a high number of women work, being a full-time employee isn’t an option. Among women, the perception gap is even starker: just 1 per cent believe KiwiSaver is designed for sole traders, while 69 per cent say it’s made for employees. Only seven per cent supported the cuts, compared to 19 per cent of men.

“As time goes on, more people disagree with the cuts; 57 per cent are opposed to them, up from 52 per cent in June. This issue isn’t going away, and negative sentiment is only growing,” Fuller says.

The survey also revealed plummeting confidence in the economy, now at its lowest in 18 months.

While confidence in KiwiSaver tumbles, the self-employed are turning to other ways to secure their financial future. Forty-three per cent have money in term deposits or private funds, 30 per cent invest in shares and 29 per cent in property. Yet only 17 per cent plan to sell their business to fund retirement, debunking the idea that small-business owners can rely on a future buyout.

“Many sole traders don’t have any other option than self-employment - particularly in essential professions like midwifery and physiotherapy; and it seems beyond belief that they’re being penalised in this way”.

The October Sole Trader Pulse - New Zealand’s only independent survey of sole traders - ran from 16 September to 2 October 2025, with a maximum margin of error of ±4.4 per cent.

About Hnry:

Founded in 2017, Hnry is one of New Zealand’s largest accountancy firms. It provides a pay-as-you-go all-in-one digital accounting service handling invoicing, expenses, payments, taxes, filings, and expert on-demand support. Hnry takes care of all the financial admin for contractors, freelancers, sole traders, and the self-employed, allowing them to focus on getting the job done rather than worrying about tax and compliance. Hnry recently won the ‘Innovation in Financial Services’ category at the 2024 INFINZ Awards. In 2023 and 2024, as well as being one of the leading companies in the Deloitte Fast 50, it was also recognised as the Fastest Growing Technology Business in the Wellington and Lower North Island region.

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