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IMPORTANT: Please note that the content provided in this guide is of a general nature. It is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance. Feel free to get in touch if you have any questions, comments or concerns.



In this quick guide, we’ll look at what ‘being on track for retirement’ means: how much you may need, what’s enough, and when is a good time to start fleshing out a structured plan. We’ll share some rules of thumb, but also raise thought-provoking questions and little nuggets of inspiration, to help you take a closer look at your own needs.

And of course, we’re here for any questions you might have. As you’ll see, a seemingly simple question like “Am I on track for retirement?” is multifaceted, and with quality advice, we can help you make sense of it all. So, let’s get started.

Where are you today?

Where are you today?

Retirement – it’s a journey, not a destination. And just like every journey, one must start at the beginning. By knowing where you are now, you can better understand the length of the road ahead, and what steps you can take to get closer to your goal. So, first things first, what’s your life stage?

20s and 30s

Generally speaking, if you’re in your 20s or early 30s, it’s likely to be too early for a structured retirement plan. In many respects, you’re just starting out in your financial life. You might be taking your first steps in your career, saving for a home or getting a mortgage, tying the knot, perhaps starting a family – it’s a time when many ‘financial seeds’ are planted. That’s why a structured retirement plan can probably take the back seat for now.

But that doesn’t mean retirement itself should be completely off your radar. Two steps, in particular, might set you up for a more comfortable retirement lifestyle: investing in KiwiSaver, and focusing on clearing debt as fast as possible (including your mortgage, if you have one). The earlier you start taking these two steps, the better. With KiwiSaver and investing, even small contributions – coupled with employer contributions, annual Government contributions, and the power of compounding returns – can really add up over time. It’s not a retirement plan, strictly speaking, but a good foundation for your future plans.

40 and over

When it comes to retirement planning, your 40s are a crucial time. That’s when the need for a retirement plan becomes more apparent. By now, the ‘financial seeds’ you planted in your 20s and 30s have started to sprout and grow. You might have paid down a good chunk of your mortgage, increased your savings, and hopefully kept your debt levels under control.

In your 40s (and continuing in your 50s), it’s important to clearly define what your retirement lifestyle may look like, think about what assets you can use to support your retirement needs, and create an action plan to supplement your existing tools. In other words, if you’re in your 40s and 50s, the remainder of this quick guide is for you.

How much do you need?

How much do you need

To understand if you’re on track, you’ll need to first imagine what your desired retirement lifestyle looks like.

How would you like to live in your senior years? Would you like to pick up a new hobby, or maybe go on the adventure of a lifetime around the world? Do you see yourself spending more quality time with the family? Or the thought of having too much free time on your hands doesn’t appeal to you, and you’d rather work part-time for a few more years?

Of course, we could go on with examples forever: retirement means different things to different people. But at its core, it boils down to one thing: having the freedom to choose how you spend your time. Whether or not you’re looking at leaving the workforce at 65 on the dot, the key thing is to have the resources to fund a healthy and happy daily life, for the rest of your life.

How to calculate your retirement saving needs?

How to calculate your retirement saving needs?

So, how much may you need? There’s no one-size-fits-all, of course: it depends on several factors. But a good place to start is to consider two things: NZ Super and projected longevity.

As you’ll know, the New Zealand Superannuation is a universal payment for eligible NZ citizens and residents who are 65 or older. How much you get depends on your circumstances, but at the moment, it’s around $330-400 per week per person. This amount is unlikely to be enough to fund a comfortable retirement, or even one without bells and whistles in most cases. Plus, there’s no guarantee that NZ Super will even exist as we know it, 20 or 30 years from now.

That’s why KiwiSaver was introduced in the first place: to help Kiwis bridge the gap between the pension and living expenses, on its own and/or in combination with other tools. A robust retirement plan is designed to address the pension gap (or even remove the reliance on NZ Super altogether), and help ensure that the money you save lasts you as long as you need it to.

Which brings us to the other key factor: longevity. In general, when we talk about longevity projections with clients, we start with an average. Typically, we build plans based on a life expectancy of 85 or 90 years – that’s 20 or 25 retirement years, if they stop working at 65. But a family history of longevity also matters, so your projected life expectancy may be age 95 or 98, which can make a significant difference to your retirement income needs.

Like to learn more? Our calculator is a good place to start, and once again, if you’d like to discuss this further, we’re here to answer any questions you may have.

What's enough?

What’s enough

This is another good question: once you know how much you need, it’s also important to understand what’s actually enough for you.

Let’s say you have a plan, and you’re actively working towards your desired retirement lifestyle. Your retirement plan may entail contributing to your KiwiSaver on a regular basis. Perhaps you’re also building an investment/property portfolio in the meantime, to supplement wealth generation. If all goes to plan, at some point you may realise that you don’t need to save more than that (or not at the same rate, at least): you already have what it takes for a comfortable retirement.

Once again, the goal of your retirement plan is to give you choices, now and in the future. If you want to, you can always choose to save even more and have more buffers in place. Or, you can choose to enjoy those funds right now. At the end of the day, it’s about striking a balance between long-term goals and current quality of life.

Balancing time horizon and risk

Balancing time horizon and risk

How much time do you have before retiring? And what does that have to do with investment risks?

Whether it’s KiwiSaver or other investment vehicles, investing always entails a certain level of risk (or volatility) in exchange for potential returns. The higher the risk, the more volatility you’re likely to see – and the greater the likelihood of higher returns over time.

That’s why it’s important to understand your risk profile. On one side, there’s your attitude to risk – broadly speaking, how much risk you’re comfortable to take, and how you feel about investment losses. On the other side, there’s your ‘capacity’ for risk: the amount of volatility you can handle in your investments, which largely depends on your goals and when you’ll need the funds.

In other words, your investment time horizon is a factor that can work for or against you, in terms of volatility. For example, if you have a three-to-five-year time horizon, you may want to ‘protect’ your funds as much as possible, by choosing a less volatile, lower-risk KiwiSaver fund.

But with longer time horizons, ten years and over, you may not need to be as conservative with your KiwiSaver (or other investments). Keep in mind that, since the 1920s, there’s only ever been one decade in which investors lost money over a 10-year timeframe: that was 2000-2010, which included both GFC and the Dot-Com bubble.

While past performance is never an indication of future performance, understanding the relationship between time horizon and investment risk is about thinking strategically. If your time horizon is reasonably long, being too conservative may see you miss out on significant growth opportunities.

Shortfall: What are my options?

Shortfall: What are my options?

If you’ve realised that you’re not on track, it’s never too late to take action. And there’s a number of things that you can do.

The first step is to look at additional measures that might be available to supplement your income. Sometimes, we talk to clients in their 50s who haven’t been saving for a long time; some have been invested in KiwiSaver for little over a decade. Our recommendation to them is to seek advice on alternative investment options, and focus on boosting wealth over the next 10 years or so.

Those who have time on their hands can also consider increasing their KiwiSaver contribution rate, provided it doesn’t compromise other financial goals (like repaying the mortgage in full).

Lastly, in some cases, you may need to reassess expectations: not necessarily your savings goal or the type of lifestyle that fits your desires, but also the timeframe of your last day of work. Staying in the workforce for a few more years could mean more savings for your desired retirement lifestyle.

We're here to help

We’re here to help

There’s a lot to think about – From knowing where you’re at and understanding where you’d like to be, through to creating and periodically reassessing your action plan.

Feel free to use our handy online tools for some personal planning, and to get in touch should like to talk to one of the advice team.


How much you’re contributing, your fund type, your risk appetite and capacity, and more: use our handy Quiz to take a good look at your KiwiSaver settings and goals.

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