Category Archives: Retirement Savings / KiwiSaver

Politicians need to face up to reality and discuss the future of NZ Super. – Geoff Simmons. 

In New Zealand there are currently 4.4 people working for every retired person, but this will shift to 2.4 people working for every retired person in 20 years.

The number of people over the age of 65 (and therefore receiving NZ Super) will double over the next 20 years, and the cost of paying for NZ Super will triple.

The Government’s response is to claim that NZ Super is sustainable as long as the spending is “controlled” elsewhere. When you build in the Government desire for tax cuts, that means keeping spending growth under the rate of economic growth, and often under the rate of inflation and population growth. In other words that means other areas of spending will be cut in real terms.

In the eight years of this Government, NZ Super spending has been rising by 6% per annum, while Government spending has been increasing by closer to 3%.

Taking health and Super together, if current trends continue then health and super spending could swallow the whole Government budget by 2074. In the long run it is mathematically impossible to keep a lid on all spending to allow for NZ Superannuation without increasing taxes.

Morgan Foundation 

NZ Superannuation: Equality finally at 65.

John Roughan: I’ve applied for a cash benefit I don’t need. NZ Herald

Actually John, as your Neoliberal brain well knows, New Zealand’s ‘Universal Basic Income’ for everyone over 65, unconditional of assets or income, is looked on with great envy by experts around the world. Imagine what it would do for our economy if we lowered the eligibility age down to 18 years of age.  A basic income for everybody is being advanced by many experts and economists around the world as the only viable way of saving our capitalist economies in the face of massive and growing unemployment due to technological automation. In order for our economy to function people must have money to spend.

You’re “investing” in your house, after all, so it’s not consuming your future wealth, is it? 

Our easy finance culture makes it simple to borrow to get the things we “deserve”, and coupled with a dose of excusitis, we convince ourselves that we’ve made an “investment”.
The idea is that when you retire, your super can be used to pay off your supersized mortgage. The problem here is that you’ve just consumed your retirement savings in one fell swoop paying off the bank. It won’t be long before the banks here want to know how much KiwiSaver you’re expecting when you turn 65. NZ Herald 

In legal circles, there is an established principle that ignorance is no excuse. Surely, a similar principle should apply when it comes to our retirement savings.

Carmel Fisher: Want KiwiSaver details? Just look.

If a KiwiSaver member has not taken any interest in where their retirement savings are invested – even though that information is freely and readily available – is that member partially or fully responsible for “not knowing enough”? NZ Herald