Retirement planning must take heed of economic headwinds

Retirement planning must take heed of economic headwinds

The latest retirement expenditure figures from Massey University’s Fin-Ed and Financial Advice New Zealand shows the effect of inflation on expenditure for each of the household groups looked at in the research was in the range of 1.80% to 3.46%, with only two household groups having an effective inflation rate above the CPI rate of 3.30% for the same period.

“As households continue to spend at levels in excess of NZ Superannuation, New Zealanders need to consider the changing economic environment to determine the savings they need to achieve their retirement objectives,” says Massey University Associate Professor Claire Matthews.

The report shows weekly expenditure for a one-person “no frills” household in the provinces saw the largest increase of 3.46% to $564.25, while city dwelling two-person “no frills” households also outpaced inflation, at 3.34% to $909.90.

Households generally continue to spend more than they receive in New Zealand Super, reflecting their ability to fund their lifestyle with other income sources or savings, the report outlines.