New research shows that 55% of New Zealanders are struggling with their financial situation – up 17% compared to February 2021 and the highest level since surveying began.

Out of those surveyed, 51% say they are ‘starting to sink, or treading water’ and a further 3.5% are ‘sinking badly’.

Since February 2021, Te Ara Ahunga Ora Retirement Commission has commissioned TRA to survey 4000 people annually, gathering insights on how people are feeling about money and how they are coping.

The latest findings have revealed that women, Māori and Pacific Peoples are being hit the hardest, with 61% of women saying they are in a difficult position financially (compared to 48% of men) and 60% of Māori and 58% of Pasifika are also struggling.

Sorted Personal Finance Lead Tom Hartmann says it’s concerning so many Kiwi are feeling the pressures of cost increases.

“We have now tipped into more than half the population feeling squeezed financially. This significantly reduces people’s ability to grow their money for tomorrow, which has long-term consequences for their future financial wellbeing.”

Those people in the survey who are struggling with money have reported experiencing more financial stress as a result.

Te Ara Ahunga Ora Research Lead Dr Jo Gamble says financial stress impacts relationships with more women, Māori and Pasifika hiding or concealing their financial situation from their family or friends than the average New Zealander.

“Sixty percent of the average population have experienced financial stress within the last year, however this was significantly higher for 18–35-year-olds at 76%, Māori at 76% and 78% of Pasifika,” she says.

“Financial stress can ripple across a person’s whole life impacting not only their financial wellbeing but how they relate to the friends and family, and the choices they make socially.

“It’s important for New Zealanders to reach out for help if they are struggling, as with support and small changes it can be easier to manage money, which benefits your mental wellbeing.”

This research also looked at New Zealander’s financial behaviour in four key areas; budgeting, saving, tackling debt, and KiwiSaver and retirement, which link to Sorted’s key money management pillars.

The research showed some positive movements across all groups with people focusing on their money management skills – including keeping a close watch on their money and considering purchases before they buy them.

“Developing these skills means New Zealanders may be in a better position to improve their financial position once cost of living pressures ease,” says Hartmann.

“When money is tight it can be challenging to keep budgets on track, but developing money management skills can help people keep going during tough times, and then help them get ahead when costs decrease.

“As part of Sorted Money Month, we’ve been encouraging people to hit pause, and take a moment to look at their money situation, and seek out help where they need it. This might be using the tools on Sorted, joining a money event or seeking out help from financial mentors or advisers.

“Even when times are tough, small changes can make an outsized difference and help you stay on track.”