Only half of millennials expect to have their own home by the time they retire – a ‘significant change’ from previous generations, new research shows.
In addition, only 30 per cent of millennials expect to have NZ Superannuation by the time they retire, research conducted on behalf of the Financial Services Council shows.
Richard Klipin, chief executive of the FSC, told JUNO younger Kiwis are more engaged in KiwiSaver than other generations.
They’re calling the millennials ‘Generation KiwiSaver’, he said, because they expected KiwiSaver to make up a large amount of their retirement income.
“Interestingly, younger New Zealanders are all about KiwiSaver, because the younger New Zealanders, the under-35s, they don’t have property. They don’t have an option. It’s either KiwiSaver plus NZ Super, or nothing.”
In the report, the council concluded: “This is clearly a very different environment to that faced by older New Zealanders. For those who entered the workforce 40 years ago, there is a strong reliance on property and on having a mortgage-free home to fund their retirement lifestyle.”
Two-thirds of 18 to 34-year-olds who expect to have KiwiSaver money are expecting an average of NZ$204,900 in their KiwiSaver accounts. Around 60 per cent of 18 to 34-year-olds expect to have savings accounts, with an average balance of NZ$152,900.
The research also revealed many millennials don’t know where to start when it comes to retirement planning.
“They’re calling out for help to better engage with their KiwiSaver savings to understand how much they will need by the time they retire,” the council wrote.
Millennials also wanted help with how to make their savings work harder for them while they’re accumulating a retirement kitty, and how to make their assets last them to an expected average age of 83.
The survey of 2,199 respondents was conducted by Horizon Research, on behalf of the Financial Services Council. See the full report here.
First published 6 July, 2018
Story by Claire Connell
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