8 December 2022
64% of Kiwi believe they need to be saving more for retirement and only around a quarter (27%) have a clear idea how much money they’ll need when they retire, according to new research commissioned by ASB.
Of the almost one thousand New Zealanders surveyed, only 23% say they have a good overall understanding of KiwiSaver, more than 15 years after the scheme began.
To help address these challenges, ASB is launching a new KiwiSaver advice tool in its mobile app and online banking, providing guidance and advice personalised to customers’ circumstances and their financial goals. As well as accessing expert, on-the-spot advice on fund choice, savers can make changes within the tool, improving their financial prospects at the click of a button. Further iterations of the tool will also include goals-based projections and other support features.
“Our research continually shows that New Zealanders don’t have a good understanding of their KiwiSaver despite it making up an increasingly large portion of their retirement savings,” says ASB Head of KiwiSaver Distribution, Hamish Davidson.
According to the Retirement Commission, the average KiwiSaver balance for those between 51 and the retirement age of 65 is just over $49,000, which is significantly below recent guidance from Massey University which shows a retired couple requires $755,000 to live comfortably in retirement (or $480,000 in provincial New Zealand).
“Being in the right fund is one of the main factors that can have a significant impact on savings at retirement and our new self-service tool helps provide that information to our customers. Contributions is another critical component and customers can engage with us to discuss their options and see how small amounts today can make a significant difference to their future savings.”
A Retirement Commission report released last week shows one in three New Zealanders don’t think they will have enough for retirement unless they continue working after 65 years of age. ASB’s research backs this up, with 72% of survey respondents saying they don’t plan to retire until 65 or older, with 21% of these people saying they don’t expect this to be until after 70-years-old.
“Retirement can feel like a long way off, but the decisions people make now can mean the difference between being able to retire comfortably or not,” says Mr Davidson. “I’d really encourage people to take steps to understand their KiwiSaver and get some advice, whether that be through a financial advisor or their provider, or via one of the many online tools available.
“We know everyone’s goals are different when it comes to saving, including KiwiSaver, and we’ve designed this tool to provide relevant fund advice, whatever your goal might be.”