Retirement Planning HINTS FOR A BETTER RETIREMENT
Useful Retirement planning tips, ideas and suggestions to help you enjoy a long and prosperous retirement.
We are not affiliated with any financial products or funds. We provide free independent financial planning and retirement planning advice. You can Download our free retirement planning guide and learn how to quickly see if you will have enough money for the retirement you deserve.
- Why you need a plan for your retirement
- Does your retirement strategy include these ideas?
- Checked your retirement plan each year?
Why you need to plan for your retirement
A 2023 survey by the Retirement Commission, found that a staggering 65% of people aged over 55 have either no plan or only a ‘vague plan’ for how they will fund their retirement. This vagueness is a recipe for disaster, causing stress and anxiety.
Not knowing how long your savings will last is a major source of stress, robbing you of the peace of mind you have earned in retirement. It can also lead to inefficient use of funds, where people draw down their savings too quickly, or conversely, be overly cautious re a “Fear of Running Out“ (FORO).
A previous Massey University Retirement Expenditure Guidelines report (2024), indicated that the ‘fear of running out’ (FORO) may lead to over-saving thereby reducing one’s quality of life, while in retirement it may cause under-spending even when sufficient funds are available”.
While their report confirmed that weekly expenditure costs reduced between their 2023 and 2024 reports, the “reduction in expenditure levels for several household groups in the latest Household Economic Survey (HES) reflects that in practice, households adjust their spending as a result of rising prices and therefore avoid some of the inflationary impact” i.e. that retirees could not afford to spend more (to keep up with inflation) so they had to cut back!.
Pre-retirement, when things get tough, you have options to both increase your income and reduce your expenses to bridge any financial gaps you experience. And you also have time. During retirement you don’t have time, you have very limited options to increase your income, so typically your only option is to cut back on your expenses – i.e. to go without!
Also, In July 2022, Stats NZ published their wellbeing statistics and associated report. It doesn’t make for good reading.
Wellbeing statistics give a picture of social wellbeing in the New Zealand population. They're based on people's assessments of their own lives such as how satisfied they are, along with objective information such as their labour force status, age, income bands etc.
Data is based on Stats General Social Survey. The data collection began on 1 April 2021, a year after the first COVID-19 lockdown, but finished early on 17 August 2021 due to the first community outbreak of the Delta variant. So while it represents some of the issues experienced during Covid, the survey was conducted prior to the Governments acknowledgement that we now have a ‘cost of living crisis’, inflation was not yet out of control, and significant increases in mortgage interest rates hadn’t yet occurred or had been signaled to occur.
One of the questions was participants “Adequacy of income to meet everyday needs”. Participants were requested to select one of four answers: Not enough money, Only just enough money, Enough money, or More than enough money.
Over 33% of those in the 65 – 74 age bracket indicated they had not enough money (11%), or only just enough money (22.4%). This group is already retired, but are struggling financially.
What was more concerning is the younger age bracket, the 55 – 64 year olds. Almost 30% indicated they had either not enough money (9%), or only just enough money (20%). This is the period in their life when they should be saving for retirement, and they don’t even have adequate income to meet their everyday needs.
Furthermore, looking at income adequacy in household income bands, 35% of households with annual income in the $70,001 – $100,000 indicated they either don’t have enough money or have only just enough money, with 33% in the $100,001 – $150,000 indicating the same concerns. Obviously as income reduces, the level of concern gets higher with 46% in the $30,001 – $70,000 band, and 53% in the less than $30,000 band indicating concerns with their level of income. So even people in the higher income brackets are experiencing financial pressure.
If people are not able to address these concerns, then they are not looking forward towards any quality of lifestyle in retirement. If you are scared about retirement, investing in or investing for your retirement, have no idea how you split your retirement funds into different buckets for better management, or you don’t yet understand the $’s needed for retirement or you cashflow needs, then you definitely need to read our free Financial Planning For Retirement Guide or come to one of our courses and get your retirement sorted. With current term deposits (< three years) now providing returns of under 2%, while inflation is running at 3.0% (before you’re even taxed!), you are already going backwards financially. Without understanding how to manage the risks when investing to obtain higher returns, you are not only risking your money and assets, but the quality of your retirement lifestyle. You need to increase your financial literacy now – so you can have the quality of retirement you want and deserve.
Download our planning guide and take control of your retirement.
If people are not able to address these concerns, then they are not looking forward towards any quality of lifestyle in retirement. If you are scared about retirement, investing in or investing for your retirement, have no idea how you split your retirement funds into different buckets for better management, or you don’t yet understand the $’s needed for retirement or you cashflow needs, then you definitely need to read our free Financial Planning For Retirement Guide or come to one of our courses and get your retirement sorted. With current term deposits (< three years) now providing returns of under 2%, while inflation is running at 3.0% (before you’re even taxed!), you are already going backwards financially. Without understanding how to manage the risks when investing to obtain higher returns, you are not only risking your money and assets, but the quality of your retirement lifestyle. You need to increase your financial literacy now – so you can have the quality of retirement you want and deserve.
Download our planning guide and take control of your retirement.