By Amanda Morrall
Half of New Zealanders worry they are not saving enough to fund the standard of living they want in retirement, according to a survey released today by KiwiSaver provider ANZ Wealth.
The survey, part of ANZ's new quarterly Retirement Savings Confidence Barometer, also found that women and Kiwis closest to retirement are among those most insecure about their financial well-being in old age.
ANZ Wealth's managing director, John Body, said the findings underscored most prominently the gap between the lifestyle Kiwis desire in old age and what they are putting aside in savings to achieve it. Survey respondents were presented with the lump sum they would need to save by age 65 to generate additional income above NZ Superannuation (NZS) and asked how confident they were of reaching their goal.
As an example, participants were told that to receive an additional income of NZ$100 per week over a 20 year period, they would need to have saved around NZ$83,000* by the time they retired at 65. For an extra NZ$300 a week the amount increased to NZ$249,000.
"These are sobering amounts of money for most people,'' said Body, in a prepared statement.
The survey, to be released in full in July, also found that men and younger New Zealanders were most confident about reaching savings goals while women and those closest to retirement were most insecure. Survey respondents were presented with the lump sum they would need to save by age 65 to generate additional income above NZS and asked how confident they were of reaching their goal.
Body credited the advent of KiwiSaver for boosting the confidence levels among younger New Zealanders with respect to their future savings levels. He said he was also encouraged by a higher than expected level of savers. Of the 1,000 Kiwis surveyed, 62 per cent of those aged under 65 indicated they had some form of retirement savings.
“This has been helped enormously by KiwiSaver,” said Mr Body.
“It has introduced the savings habit to a whole generation of New Zealanders, has focused people on the need to save for their retirement and will, over time, increase the confidence that people can reach their savings goals.”
*The lump sum figures used by ANZ Wealth in their projections were inflation adjusted at a rate of 2.5% and assumed an after tax and after inflation return of 3% per year.