Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


41% say “force me to save”

30 April 2014

For Immediate Release

New Zealanders reject claim they don’t have a retirement savings problem: 41% say “force me to save”

The public resoundingly disagree with one university expert’s opinion that New Zealand does not have a savings problem and don’t need compulsory KiwiSaver.

The Financial Services Council (FSC) says a co-director of the University of Auckland’s Retirement Policy Research Centre, Michael Littlewood, is “totally out of step” with the majority of New Zealanders when he said on radio today that “New Zealand does not have a savings problem”.

The FSC’s Chief Executive, Peter Nelson, says research conducted independently for it finds a staggering 41% of adults - equivalent to 1,384,000 New Zealanders 18+ - feel they need to be compelled to save.

The research, covering 3060 respondents nationwide in October last year, and released for the first time today, finds

70% support for making KiwiSaver compulsory:

65% support a compulsory savings scheme and 5% “lean toward” supporting it.

12% oppose a compulsory savings scheme and 3% “lean toward” opposing it.

8% are neutral – and could go either way.


Mr Neilson says Kiwis believe overwhelmingly that they are not saving enough for retirement and that they won’t be able to live comfortably on the NZ Super pension alone. The pension currently pays $282 for each of a couple after tax.

“New Zealanders on average believe they need twice NZ Super to live comfortably,” Mr Neilson says. “Yet our research finds only 6% are currently contributing 10% or more to their KiwiSaver accounts (the level required over 40 years to fund a comfortable retirement at 2 times NZ Super on current policy settings).

“It’s abundantly clear that Kiwis want to lift retirement incomes, are prepared to save to do that through a compulsory KiwiSaver scheme – and more than 1.3 million actually say they need to be forced to do that, because they know they won’t get around to doing it themselves,” Mr Neilson says.

“People know we have a savings problem – and survival on the pension alone is going to be an extremely long term affair without increased savings. Today’s job starters will face living more than 30 years after reaching age 65, compared with the 15-20 years of their grandparents.

“If they are presented with a package of policies which mean they can gradually start contributions (at 0.5% a year each from employer and employee per year until they reach the minimum required under KiwiSaver), investments being defaulted into balanced funds (instead of conservative) and fairer taxes on savings, then they’re huge fans of compulsory KiwiSaver.

“Kiwis are not silly: they know that a long-term policy and long-term savings are needed to build their wealth. They simply don’t believe experts who say they are saving enough and they won’t have a problem in the future. Already large numbers of people trying to live on NZ Super alone are struggling, especially those who must pay market rents.

The FSC’s members include most of the large KiwiSaver fund managers. The organisation, however, does not have a policy on compulsory or voluntary KiwiSaver. The FSC provides research and polling to enable political parties and the public to make up their minds on the issues but says the future of saving for a comfortable retirement income is one of the most important conversations the country needs to have.

Research results and notes:

October 2013, Horizon Research survey of 3,060 respondents nationwide aged 18+ Weighted to represent the adult population at the 2013 census. At a 95% confidence level the maximum margin of error is ±1.8%.

Need for extra retirement income:

• 8% of New Zealanders 18 years of age or over (but only 7% of 18-64 year olds) believe they could live comfortably in retirement on New Zealand Superannuation with no other income.

• 70% believe they could not do so.


Support for compulsory KiwiSaver:

• 70% support for making KiwiSaver compulsory:

• 65% support a compulsory savings scheme and 5% “lean toward” supporting it.

• 12% oppose a compulsory savings scheme and 3% “lean toward” opposing it.

• 8% are neutral – and could go either way.

Now that you have thought about it some more, what do you think of New Zealand making KiwiSaver compulsory, where all employees and employers have to contribute? ALL 18-64 years 65+ years
It's a terrible idea and I'd oppose it 6.9% 7.6% 3.5%
It's probably a good idea for New Zealand, but not for me and so I'd oppose it 5.5% 5.0% 8.2%
It's a good idea and I'd support it, with some reservations 29.7% 31.1% 23.1%
It's a good idea and I'd fully support it 35.2% 33.7% 44.2%


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Must Sell 20 Petrol Stations: Z Cleared To Buy Caltex Assets

Z Energy is allowed to buy the Caltex and Challenge! petrol station chains but must sell 19 of its retail sites and one truck-stop, the Commerce Commission has ruled in a split decision that acknowledges possible retail price coordination between fuel retailers occurs in some regions. More>>

ALSO:

Huntly: Genesis Extends Life Of Coal-Fuelled Power Station To 2022

Genesis Energy will keep its two coal and gas-fired units at Huntly Power Station operating until 2022, having previously said they'd be closed by 2018, after wringing a high price from other electricity generators who wanted to keep them as back-up. More>>

ALSO:

Dammed If You Do: Ruataniwha Irrigation Scheme Hits Farmer Uptake Targets

Enough Hawke's Bay farmers have signed up for water from the proposed Ruataniwha Water Storage Scheme for it to go ahead as long as a cornerstone institutional capital investor can be found to back it, its regional council promoter announced. More>>

ALSO:

Reserve Bank: OCR Stays At 2.25%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2.25 percent, in a decision traders had said could go either way, while predicting inflation will pick up as the slump in oil prices washes out of the data and capacity pressures start to build in the economy. More>>

ALSO:

Export Values Down: NZ Posts Biggest Annual Trade Deficit In 7 Years

New Zealand has recorded its biggest annual trade deficit since April 2009, reflecting weaker prices of agricultural commodities such as dairy products, beef and lamb, and increased imports of vehicles and machinery. More>>

ALSO:

Currency Events: NZ's New $5 Note Wins International Banknote Award

New Zealand’s new Brighter Money $5 note has been named Banknote of the Year in a prestigious international competition. The $5 note was awarded the IBNS Banknote of the Year title at the International Bank Note Society’s annual meeting. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news