If you're self employed, KiwiSaver can seem like a luxury. 

Maybe your income is lumpy, or you don't know from month to month whether you'll have work. Making those voluntary payments can seem like you're trading security today for certainty in old age. 

If paying into your retirement fund comes at the expense of being able to pay your mortgage or bills, then obviously KiwiSaver won't make that much sense. Remember however, that it only takes $20 a week to get $521 a year for free! That's a coffee Monday through Friday for most people.

In most circumstances, it's pretty hard to imagine saying no to $521 in 'free money.' And assuming those sweeteners are still around when you retire, you're saying no to a whole heck of a lot more than $521. If you're 45, and still have 20 years to go, that's $10,420. Factor in the compounding interest of that extra money and the potential returns, it's even more.

Should mortgage repayment or high interest debt take priority?

You'll be hard pressed to find a better return on investment than paying down the mortgage faster or repaying your high interest-bearing debt, but when we're talking about $20 a week, or five lattes, it's seems crazy why you wouldn't pad your nestegg and hit both these biggies at the same time.

How do you do it?

Setting up auto-payments is probably the easiest way to do it. Simplicity's bank account number is 01-1839-0816624-00, just include your name and IRD number in the reference field so our team can make sure it goes to the right account.

The benefit of doing this is the money comes out before you get a chance to spend it and you'll adjust your other spending accordingly. A few less takeaways perhaps or less alcohol or movies at home. There are very simply ways to rationalise the budget that won't impact your lifestyle in a significant way.

If money is too tight, then maybe make that $1,043 contribution on a good pay day if you're a contractor. As long as it's made before June 30, you're eligible to receive the maximum top up of $521.

Even if you can't make $1,043 in a year, the government will still meet you half way for your contributions. Still, why would you want to leave $521 on the table when it's just sitting there. Beats me!

Amanda and The Team at Simplicity