Sinclair, who scored a double hundred on Test debut against West Indies in 1999, said his six-month cricket pay was not enough to support his wife and two children and was seeking unemployment benefit in Napier.
"This week "Skippy" Sinclair walked into Work and Income in Napier to sign up for the unemployment benefit," New Zealand's stuff.co.nz reported on Wednesday.
"The reality is, this is what it's like. It has been quite a tough decision to make," Sinclair, 37, was quoted as saying.
"I would rather get out on my own terms. I have never brought the game into disrepute and I can walk out with honesty and integrity," he added.
On a job after cricket career, he said: "It has been very hard to look for some sort of meaningful employment."
Sinclair scored two double centuries in his first 13 Tests but could not continue the same form. He played 33 Tests and scored 1,635 runs at 32.05 with 3 tons.