Innovation must enhance wealth prospects for Maori/Pasifika
The answer to improving the financial future of Māori and Pasifika could be tailoring financial products and services to meet specific cultural needs, says Kiwi Wealth.
Kiwi Wealth’s State of the Investor Nation report – a landmark examination of Kiwis’ perceptions of wealth and wealth creation – found Māori and Pasifika were falling further and further behind financially.
While the gap between the haves and the have-nots had widened across all demographics, the Kiwi Wealth report showed it was particularly pronounced for Māori and Pasifika.
“Our report found a third of all Māori and Pasifika felt worse off financially today than they did a year ago,” says Joe Bishop, Kiwi Wealth General Manager Customer, Product and Innovation.
“Almost 40% were struggling or only just getting by week to week. That means there’s no money left over for saving or investment.
“These are alarming findings and proof that we, the financial services sector, aren’t doing enough to help those most in need to build better financial futures.”
Helping Māori and Pasifika get more out of KiwiSaver was the best place to start. With Māori and Pasifika least likely to know what KiwiSaver fund they are in, or make changes, they are missing out on opportunities to build wealth for retirement, says Bishop.
“Again, it’s on us as KiwiSaver scheme providers to understand why Māori and Pasifika aren’t more actively involved in KiwiSaver and to do something about it. Are we using the right channels to reach them? Is the information we provide suitable? Are the products we offer fit for purpose?”
In the coming months, Kiwi Wealth will launch a major update of its online KiwiSaver retirement income planning tool, the award-winning Future You®. It will soon allow members of the Kiwi Wealth KiwiSaver Scheme to factor in their partner’s KiwiSaver account, providing a projection of what a couple’s retirement income may be from their KiwiSaver and New Zealand Superannuation accounts.
Bishop says feedback from Kiwi Wealth members shows planning for retirement is something that often went beyond individuals.
“As well as factoring in couples, something else that came out of our Bigger Than Me study was that a lot of people – Indian and Chinese members especially, as well as Māori and Pasifika – are often part of extended family units, with wealth managed on a whānau basis. They wanted to see future financial plans and advice presented and communicated on that basis.
“We want to understand how we might incorporate that dynamic in our tools and products so that we can give a clearer understanding of how families and whānau are tracking together, rather than individuals.”