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13% of 55 to 64 year-olds unsure how they'll fund retirement

25 Oct 23

13% of 55 to 64 year-olds unsure how they'll fund retirement

Thirteen per cent of people aged 55 to 64 don’t know how they will fund their retirement, according to a Horizon Research survey of 1,600 Kiwis for ANZ Investments.

It comes as a large number of those 65 and over continue to contribute to their KiwiSaver accounts.

“For many people, 65 is no longer the finish line. They’re still working, through choice or necessity,” said Fiona Mackenzie, managing director of ANZ Investments, the New Zealand Herald reports (pay walled).

“It might seem surprising that almost a third of our baby boomer members aged 65 and older are still contributing to their KiwiSaver accounts.

“But it reflects how the way we think about retirement is changing.”

The research found clear differences between the generations when it comes to how they plan to fund life after 65.

“Gen Z and Millennials particularly view KiwiSaver as their main way of saving for a comfortable retirement,” Mackenzie said.

Sixty-nine per cent of respondents aged 18 to 24 said they plan on using KiwiSaver to fund their retirement, compared to only 17 per cent who said NZ Super.

However, 69 per cent of respondents aged 55 to 64 said they planned to use NZ Super, while 67 per cent would also use KiwiSaver.

“KiwiSaver is 16 years old, and we wanted to understand what importance our members place on KiwiSaver as opposed to other forms of saving and investing,” Mackenzie said.

“The findings tell a really interesting story and remind us of the impact socioeconomic factors can have on different generations.”

Mackenzie said that many older KiwiSaver members have not had the benefit of the savings scheme – where an employer contributes at least 3 per cent of your gross earnings – for their full working lives.

She said it is a misconception you need to withdraw your savings as soon as you turn 65.

“You can leave your money in your KiwiSaver account until you decide to withdraw some or all of it,” Mackenzie said.

“If people are working, they can choose to make regular contributions from their salary or wages, as many of our members are doing. They can also make lump sum contributions at any time.”

According to ANZ Investments, 32.5 per cent of its members aged 65 and over are making employee contributions and 18.5 per cent are making voluntary contributions.