Experts Contemplate Compulsory Kiwi Saver-Good Return

That number can be daunting-more than $ 1 million for a couple to retire comfortably-but many kiwis don’t have anything close to their Kiwi Saver account by retirement.

Wednesday, September 22, 2021 1:23 pm

Matthew Martin

So do you need to force KiwiSaver?

Given that 35% of New Zealanders over the age of 60 do not know how much they need to retire comfortably. Studies show Provided by the Financial Services Council (FSC).

Compulsory Kiwi Saver was a major discussion topic at the recent “FSC Connect” panel event during the Level 4 blockade in Auckland.

The panel includes Helen Skinner, Head of Emerging Assets at Craigs IP, Murray Harris, Head of Distribution at Kiwi Saver at Milford Asset Management, Nigel Jackson, Head of Investment at WestpacNZ, Geoff Rimmer, Chief Operating Officer of Trustees Executors, Richard Klipin, Chief Executive Officer of FSC, and FSC Content Manager. Did. Clarissa Hurst.

Murray Harris says Kiwi feels unprepared for retirement and talking about money isn’t really about Kiwi.

“And the level of financial literacy is low … In the case of a no-frills retirement, some people are very scared when they see the amount of money they need, while others have to continue working when they reach retirement age.” “

Harris says young people are in the best position to start saving, but many don’t even think about it until they’re in their fifties.

“Kiwi Saver has been a huge success and we must admit that it is the best financial and savings product New Zealanders have ever seen.

“But for financial and low-income people, shifting to obsession can be a household burden, especially for those who live weekly.

“But that’s an argument that needs to happen. There are some tax exemptions from the government and options for compulsory employer contributions,” says Harris.

According to Skinner, New Zealand is on a similar trajectory to pension funds around the world, with a particular focus on coercion.

“Many New Zealanders don’t know how Kiwi Saver works and how much to invest.

“It’s all about how much you really need at the endpoint and get back to work from there,” she says.

Jackson says people recognize the importance of saving for retirement, but we’re not doing enough, especially for the more vulnerable.

“But compulsion is a blunt instrument and a dangerous area for politicians.

“Obviously it is [KiwiSaver] It works better for high-income people who have long-term employment. “

Limmer, who has 30 years of experience in Australia’s old-age pension scheme, said the funding gap identified in this study is already significant.

“The Australian system has matured for over 30 years, starting with a 3% contribution and up to 9% for some time … and over time, it becomes less and less dependent on taxpayers. prize.”

Few people think of retirement when they are young, he says, but increasing money with schemes like Kiwi Saver means people are more interested in savings.

“Force itself is not a good idea,” he says.

“There are other levers that can be pulled to avoid making a big difference between what you have and what you don’t.”

tag: Financial literacy FSC Kiwi Saver Richard Klipin

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Experts Contemplate Compulsory Kiwi Saver-Good Return

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