Want a comfortable retirement?

18 May 2020

Here’s how much you’ll need a week

When you’re still working and paying rent or a mortgage, it can be hard to imagine what your retirement might look like. That makes it difficult to guess what sort of income you’d need – and therefore how much you’ll need to save while you’re still working.

How much will you need?

It’s a good idea to start thinking about what sort of retirement you’d like to have. According to a report by Massey University, single people who live in a big city with a no-frills, frugal lifestyle will need about $600 a week if they live in their own home mortgage-free. You’ll need an extra $200 or so on top of NZ Super ($400). A no frills lifestyle means you won’t be able to afford any luxuries – you won’t have much at all for entertainment, travel or new clothes, for example.

If you, like most Kiwis, would like your retirement to come with some luxuries, you’ll need more like $1,190 a week, including NZ Super. With this, you’ll be able to buy new clothes, visit the grandkids and go out for a meal now and then.

How much do you need to put into KiwiSaver?

To hit that comfortable per-week figure, you’ll also need to think about how long you’ll be retired – that is, how long you’re likely to live past 65! Average life expectancy for women and men is 90, but things like your lifestyle and genetics play a big part. If your grandparents or parents lived to a ripe old age, you’ve never smoked and are fit and healthy, you could live years longer than that average. That’s good news, but it also means you need more saved to live on during your retirement.

A good place to start is by planning your retirement journey where you can see what your retirement might look like. Try different fund types or contributions without committing to a change.  Look out for our new smarter retirement calculator coming soon in My AMP.

To work out how much you need to be saving for your retirement, go to our KiwiSaver journey planner now.

Don’t have enough? Here’s what to do

If you’ve found that you won’t have enough for a comfortable retirement, don’t worry. There’s still time – and small changes now can make a big difference in the long run. Here are some things you could do:

-     Increase how much you’re putting into your KiwiSaver account.

If you’re putting the minimum 3% of your income into your KiwiSaver account, just boosting that to 4% or 6% can make a huge difference.

-     Plan to work a bit longer.

While saying goodbye to the 9-5 grind sounds like a dream, it might pay to keep working past 65. At the moment everyone over 65 gets NZ Super, regardless of what they’re earning. Continuing to bring in your usual salary on top of that can give a real bump to your savings. Say if you continued to work until you were 70, the picture will look quite different. You could probably save more, which means you’re likely to have more money a week to cover the basics, plus a few luxuries.

-     Make lump-sum payments into your KiwiSaver account.

If you get a bonus, win a bit on Lotto, or are left an inheritance, resist the temptation to spend it, or leave it sitting in your bank account! Instead, it’s a great idea to put it into your KiwiSaver account. There it will be invested on your behalf, so you’ll probably end up with far more in the end.


Have a mortgage? It might be wise to pay that off first.

It might sound counterintuitive, but instead of putting more money into your KiwiSaver account, it can often be smarter to focus on getting mortgage-free faster.

How much do you need for retirement?

·       These guidelines do not represent recommended levels of expenditure.

·       The levels of expenditure shown in the guidelines may be used to assist in the development of projected retirement budgets, by providing information about actual levels of expenditure in retired households in standard expenditure categories.

·       The guidelines are based on averages for 1/5th of the data range.

·       There are too few responses for spending in some expenditure sub-classes to permit reliable estimation. However, these responses can be included in the class estimation where there are more responses.  As a result, the classes are not always the totals of the sub-classes.  

·       The Household Economic Survey (HES), on which the guidelines are based, relies on participants to accurately record their expenditure, and is only for a two-week period, which may not represent a typical fortnight for that household.

·       The guidelines should not be used as a substitute for professional advice specific to individual circumstances.

·       There is no retirement age in New Zealand, but the age of eligibility for NZ Superannuation (currently 65) is commonly used as a proxy for this.  The definition of a retired household follows from this, as being a household where one form of income is New Zealand Superannuation, a war pension or other government pension.  However, it is recognised that a retired household may include one or more persons who are still working part-time or even full-time.

Important information

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This calculator is intended as a guide only and does not constitute financial advice. While care has been taken to ensure the information supplied is accurate no person accepts any liability for any loss or damage arising out of the use of this calculator. Results do not reflect actual returns and are not predictions of future returns (which are subject to investment and other risks, including loss of income and principal invested). Returns are not guaranteed by any person and fees are subject to change.

Investing in the AMP KiwiSaver Scheme is subject to risk, which includes the potential for you to lose income and any amounts invested. When using this calculator, you should have regard to your particular objectives, needs and financial situation. This calculator and the results it produces are intended to be of a general nature only and are not intended to be financial advice. If necessary we recommend that you seek appropriate professional or financial advice before acting on any of the results provided by this calculator.