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

 

Scoop Business: NZ Dollar Catches Breath After "Goldilocks" Slump

The New Zealand dollar edged up following its dramatic slump yesterday after the Reserve Bank confirmed speculation it intervened in the currency market last month and PM John Key suggested a “Goldilocks” level far lower than at present. More>>

ALSO:

Biosecurity: Kiwifruit Claim To Hold Officials Accountable For Psa

Kiwifruit growers have joined forces to hold Biosecurity NZ accountable in the courts for its negligence in allowing 2010’s Psa outbreak that devastated New Zealand’s kiwifruit industry and exports. Foundation claimants representing well ... More>>

ALSO:

Poison: Anglers Advised Not To Eat Trout In 1080 Areas

With the fishing season opening in just a few days (1 October 2014), anglers are being warned by the Department of Conservation(DOC) not to eat trout from pristine backcountry waters and their downstream catchments, where the department is conducting 1080 poisoning operations. More>>.

ALSO:

Quotas: MPI Swoop On Suspected Fraudulent Fishing Activity

Ministry for Primary Industries (MPI) compliance officers swooped on a Hawkes Bay fishing enterprise today to secure evidence in an investigation into suspected fraudulent activity... “The investigation involves activity throughout the commercial supply chain – catching, landing, processing and exporting.” More>>

ALSO:

Scoop Business: Fonterra Slashes 2015 Milk Payout, Earnings Tumble 76%

Fonterra Cooperative Group cut its forecast 2015 milk price payout by about 12 percent, citing weaker global dairy prices and said there is a risk of further declines given strong global milk production. More>>

ALSO:

Scoop Business: RBNZ Keeps OCR At 3.5%, Signals Slower Pace Of Future Hikes

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5 percent and signalled he won’t be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected. The kiwi dollar fell to a seven-month low. More>>

ALSO:

Weather: Dry Spells Take Hold In South Island

Many areas in the South Island are tracking towards record dry spells as relatively warm, dry weather that began in mid-August continues... for some South Island places, the current period of fine weather is quite rare. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand

Mosh Social Media
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news