Studying up on NZ Super
Many Kiwis look forward to the freedom that comes with retirement, but most of us don’t know how much we need to save to enjoy the kind of retirement lifestyle we want.
10 February 2011
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A Nielsen survey, commissioned by the Retirement Commission, found 42% of New Zealanders hadn’t calculated how much money they need to save for retirement.
The survey also found, 84% of 45 to 59 year olds didn’t know how much NZ Super a single person living alone would receive. And 81% didn’t know how much a couple aged 65 or older would receive.
With each year, more and more of us head towards retirement. This year will see the first baby boomers (40,000 people) turning 65. In 10 years time 52,000 people will turn 65. To be able to enjoy the retirement you want, it’s important to work out how much money you’ll need to support your lifestyle.
Around 40% of today’s retirees live on NZ Super alone - currently $333 per week for a single person and $511 per week for couples (after tax at ‘M’ rate). And another 20% live on NZ Super and approximately another $100 a week of other income.
If you want more than that for your retirement, it’s time to work out a savings plan. Think about the sources of income you will have besides NZ Super. You may have joined KiwiSaver or another work-related savings scheme or you may have another savings plan or investments.
Also consider the cost of your ongoing expenses. Will you still be paying a mortgage or renting when you retire? There is home maintenance as well as rates and other bills to think about in addition to the money you’ll need for your hobbies, travel, transport and healthcare.
Sorted.org.nz's Quick Retirement calculator can show you how much you need to save and our KiwiSaver calculator will show you how much you could save by age 65 – depending on how much you contribute.
The most important thing to do, is to do something. It is never too late to make a plan no matter what your age.