How to save money for retirement in your 30s

4 min read

When it comes to saving for your retirement, people in their 30s are in a great position. This is because of the simple fact that time is on their side - there’s plenty of time to pay down debt and the sooner the saving starts, the better. They’ll probably have a few pay rises under the belt, and with some 35 years or so until retirement, there’s a lot of time to really grow those savings. Naturally, saving is easier said than done, so here are five pointers to consider if you’re in your 30s.

1. Destroy that debt

Debt is your enemy and needs to be eliminated, preferably before you reach your 40s. That’s because people in their 40s are, on average, at the peak of their earning powers and want to be putting as much of that earning power to work as savings, rather than paying down debt. If you’ve got a few lingering debts, it’s time to knuckle down and knock them off.

Tip: Pay more than the minimum monthly payment on any debt. Over time, the savings in interest alone will mount up and you’ll pay less over all. If you have more than one debt, pay off the highest interest ones first, then once cleared, use those payments to clear the smaller ones.

2. Don’t be too risk averse

When we say don’t be too risk averse in your 30s, we don’t mean going out and splashing your money around, we mean it’s ok to play a slightly riskier hand when it comes to investing. That’s because, even if an investment doesn’t perform as well as hoped, there’s time to recover. Investments, such as Kiwisaver, are a good example of how this works. Most Kiwisaver providers offer a range of funds, some will be designed to work best in the short term, others will be geared for longer terms. Take a look at the six BNZ Kiwisaver funds to get an idea of how this works in practice.

Tip: Compound interest refers to the way savings can grow exponentially over the long term as interest is earned on top of interest. Even if you only save the same amount each week, because of the way compound interest works, the total will grow larger thanks to ever increasing interest earnings.

3. Make the most of Kiwisaver

We’ve touched on Kiwisaver already, but it deserves its own section. For many New Zealanders in their 30s, that Kiwisaver fund could be well underway by now. But if you’ve paid no attention to it since you agreed to sign up to a default provider, it could be worth checking in on it. All Kiwisaver providers offer different investment profiles, these range from low risk options (generally with slightly lower returns), to higher risk investments (usually offering slightly higher returns). You might even decide it’s worth bumping up your contribution if you can afford it to maximise returns. Lastly, make sure you’re contributing enough to collect the full government contribution or just over $500 per year.

Tip: Collect those Kiwisaver benefits. As long as you contribute $1042 over the course of the year, the government will chip in a solid $521. For a better idea of how Kiwisaver works, check out our guide.

4. Find ways to live on less than you make

Naturally, in order to save, spending less money than is coming in is an essential skill to master. Since many people in their 30s are also starting families or raising young children, chances are high that costs are continually rising just through having extra mouths to feed, clothes to buy and school costs to cover. Now, more than ever, is the time to start a budget in order to get the full picture of your finances. Once you know where you stand, it’ll be easier to figure out places where savings can be made.

Tip: Set small savings goals and stick to them. Once you get a few quick savings wins under your belt, you’ll be motivated to continue and, hopefully, create a habit along the way.

5. How much will I need?

This is a tricky question, because it’s going to be different for everyone and there are many variables. has a handy retirement calculator that shows you how much you need to save each week in order to guarantee a certain minimum income once you retire. For example, if you’ve just turned 30 and would like to have an income of $500 per week once you retire (including NZ superannuation at the current rate of $390 per week), you’ll need to invest $63 per week.

Tip: Putting a windfall to work is the best way to deal with any extra cash that may show up. It could be a bonus from work, an inheritance or a big sell off on TradeMe - whatever it is, use that money wisely and pay down debt or put it into savings where that money can actually work for you. Every little bit counts.