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NZers in retirement want it all... but not saving


MEDIA RELEASE
Sunday 17 December 2000

New Zealanders in retirement want it all…but are not saving for it


Despite the Government’s aim to increase certainty with the launch of the New Zealand Superannuation Fund, three out of four people surveyed by AMP Superwatch aren’t confident that the present level of NZ Super will continue.

John Drabble, General Manager AMP Financial Services, says: “These people aren’t confident that a similar level will be around for them when they retire.

“They also believe it is primarily their responsibility to provide for their retirement, while only 19% believe it is the Government’s,” he says.

The December AMP Superwatch surveyed 470 New Zealanders aged 18 and over during September and October 2000.

“Most think the $208 per week in NZ Super (for a single person)* will cover day to day basic living expenses. But nearly everyone surveyed aspires to a lot more than just survival in their retirement, yet they are not saving enough to meet their intentions,” says Mr Drabble.

78% expect travel or holidays
82% expect to pay for recreation activities
68% expect to financially assist their family
52% expect to buy a late model car
More than half expect to do all of these things

Those already retired have more modest expectations: 29% expect to buy a late model car; 55% expect to financially assist family. “Should we be looking to our retired parents and grandparents for a reality check on life in retirement?”

The December AMP Superwatch shows that although New Zealanders’ attitudes to saving are changing, there is still a substantial shift needed for people to afford their dream of a comfortable and fulfilling retirement.

“People go to great lengths to plan and save for a 30-day holiday, but when it comes to the longest holiday of their life, the research is showing that New Zealanders think ‘she’ll be right.’

“The aim of the New Zealand Superannuation Bill currently before Select Committee is only to address a base level of superannuation. For 83% of people surveyed that won’t be enough for their retirement, and many of them are not preparing for that fact,” says Mr Drabble.

This shows an urgent need for people to gain a greater understanding of what they need to do to save.

“A significant proportion of people surveyed earn more than $60,000. They now have the opportunity to make a 6% tax saving through employer contributions to a super scheme. But many of these people are not aware of this opportunity.

“This is but one example. The question is, are the right vehicles in place to encourage people to save? Or, is it time New Zealand levelled the playing field to encourage saving in a diverse range of options that lend themselves to provide income in retirement?

“Some combination of education and encouragement would appear to be needed if we are to increase the number of people saving for the long term.

“We’re encouraged by the tax review initiated by the Minister of Finance, and look to this review to take a lead and recommend ways to encourage long term saving,” says Mr Drabble.

(Ends)

AMP Superwatch asked: Which of the following do you expect to be able to do when you retire?
Income Age
Expect to be Able to Do When Retire %
Total
N=474 %
<$50K
N=186 %
$50K+
N=246 %
18-34
N=176 %
35-49
N=178 %
50-64
N=78 %
65+
N=42
Have a debt free home 91 87 94 93 93 89 79
Financially assist family 68 61 74 74 67 63 55
Buy a late model car 52 40 61 55 55 54 29
Travel of holidays 78 73 81 82 78 80 62
Recreation e.g. golf, bowls, fishing, arts, fitness 82 79 86 86 87 73 64
Covering day to day basic living costs 91 89 93 92 92 92 76
None 1 1 - - - 1 2
Don’t know 1 3 - - - 1 12


AMP Superwatch asked: What are you currently doing to save for your retirement?
Income Age
Currently Doing To Save for Retirement %
Total
N=474 %
<$50K
N=186 %
$50K+
N=246 %
18-34
N=176 %
35-49
N=178 %
50-64
N=78 %
65+
N=42
Paying off the mortgage on your home 45 39 53 34 66 37 12
Have a formal, long term superannuation savings plan 47 34 57 35 61 50 31
Bank or term deposit investments 33 30 34 17 37 51 45
Investing in shares 31 22 39 21 34 49 33
Residential property other than your own home 18 12 22 15 18 24 12
Unit trust investments 17 11 22 11 20 23 17
Investing in your own business 17 14 18 9 28 19 2
None 17 23 9 31 3 12 29
Don’t know 1 2 - - 1 - 7

AMP Superwatch asked: If you were retiring today, would the current level of NZ Superannuation be adequate to support you in your retirement?
Income Age
NZ Superannuation Adequate %
Total
N=474 %
<$50K
N=186 %
$50K+
N=246 %
18-34
N=176 %
35-49
N=178 %
50-64
N=78 %
65+
N=42
No 83 74 91 78 90 81 74
Yes 16 24 8 19 8 19 29
Don’t know 2 3 1 3 2 - -

AMP Superwatch asked: Are you confident that a similar level of government pension will be available for you when you retire?
Income Age
Confident Similar Level of Pension Available in Future %
Total
N=474 %
<$50K
N=186 %
$50K+
N=246 %
18-34
N=176 %
35-49
N=178 %
50-64
N=78 %
65+
N=42
No 74 67 80 79 87 60 24
Yes 17 21 13 14 10 33 33
Don’t know 9 12 7 7 4 6 43
AMP Superwatch asked: Which of these do you feel should take some responsibility to provide for you in your retirement?
Income Age
Take Some Responsibility To Provide For You in Retirement %
Total
N=474 %
<$50K
N=186 %
$50K+
N=246 %
18-34
N=176 %
35-49
N=178 %
50-64
N=78 %
65+
N=42
Yourself 92 90 95 94 95 87 81
The Government 54 59 50 56 49 58 62
Your employer 17 20 16 22 15 12 17
Your family 6 8 5 9 5 8 -
The community 3 5 3 2 4 4 5
Don’t know 1 2 - - 1 1 2
AMP Superwatch asked: And which of these should take the greatest responsibility?
Income Age
Take Greatest Responsibility To Provide For You in Retirement %
Total
N=474 %
<$50K
N=186 %
$50K+
N=246 %
18-34
N=176 %
35-49
N=178 %
50-64
N=78 %
65+
N=42
Yourself 74 65 82 74 80 65 64
The Government 19 27 13 22 11 26 29
Your employer 1 1 2 - 2 1 -
Your family - 1 - 1 - - -
The community - - - 1 - - -
Don’t know 4 5 2 2 5 8 5

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