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Superwatch: Kiwis banking on home sales for comfortable retirement

Monday 27th of November 2000

AMP Superwatch surveyed 470 New Zealanders aged 18 and over during September and October 2000. Research was conducted by Colmar Brunton Research.

AMP Superwatch asked: Which of the following are you currently saving for?

Paying off your house/mortgage. Superannuation/retirement. Travel or holidays. You own or your children’s education. A new car. Setting up or investing in own business. Deposit for a home purchase. None.

49% of respondents are currently saving for their retirement. However, only 33% of respondents earning under $50k per annum were saving for their retirement. This compares to 60% of those earning over $50k. However, 37% of those earning under $50k per annum were saving for holidays/travel abroad. This under $50k group will obviously contain a considerable proportion of under 35s.

Only 31% of respondents under 34 are saving for their retirement, as opposed to 44% saving for travel or holidays.

67% of 35-49 year olds are saving for their retirement. They are also saving to pay of their mortgages (66%), travel/holidays (35%), their own of children's education (46%), setting up or investing in own business (20%). So there are many areas competing for their share of wallet.

59% of 50-64 year olds are saving for their retirement. This group is the most focused on saving for their retirement. However, 28% are still saving to pay off their mortgage, and 39% for travel/holidays.

		Income		Age
Currently Saving For	% Total N=474	% <$50K N=186	% $50K+ N=246	% 18-34 N=176	% 35-49 N=178	% 50-64 N=78	% 65+ N=42
Superannuation/retirement	49	33	60	31	67	59	24
Paying off your house/mortgage	42	36	51	34	66	28	5
Travel or holidays	39	37	43	44	35	39	36
Your own or your children’s education	32	28	37	32	46	13	12
A new car	14	11	15	19	11	6	17
Setting up or investing in own business	14	11	17	13	20	9	-
A deposit for a home purchase	14	17	14	27	10	3	2
None	11	17	4	10	3	18	41
Don’t know	1	1	-	1	-	-	-

		Income		Age
Priority For Saving	% Total N=474	% <$50K N=186	% $50K+ N=246	% 18-34 N=176	% 35-49 N=178	% 50-64 N=78	% 65+ N=42
Paying off your house/mortgage	39	34	45	31	61	23	5
Superannuation/retirement	35	25	42	17	47	58	21
Travel or holidays	26	28	26	33	17	27	33
Your own or your children’s education	22	22	22	23	29	9	10
A deposit for a home purchase	11	13	11	24	5	3	-
Setting up or investing in own business	8	7	9	9	9	6	-
A new car	6	7	5	12	2	3	10

AMP Superwatch asked: What are you currently doing to save for your retirement?

47% of respondents said they had a formal long term super savings plan. This differed greatly across age groups from 35% of 18-34 year olds, to 61% of 35-49 year olds and 50% of 50-64 year olds.

The next most popular option was paying off the mortgage (45%) of respondents. As would be expected this varied across the age breaks considerably.

33% of the sample were using a bank or term deposit to save for their retirement. This was the preferred option for over 65's with 45% of them saying they were using a bank/term deposit. It was also a popular option for the 50-64 age group at 51%.

31% of respondents said they were investing in shares to save for their retirement. 50-64 year olds were the most likely group to use this option at (49%).

Only 18% of respondents were investing in additional residential property to save for their retirement. This compares to 17% investing in Unit Trusts and 17% investing in their own business.

17% of respondents were doing none of the options we prompted on. Including 31% of 18-34 year olds and 23% of those earning under $50k.

		Income		Age
Currently Doing To Save for Retirement	% Total N=474	% <$50K N=186	% $50K+ N=246	% 18-34 N=176	% 35-49 N=178	% 50-64 N=78	% 65+ N=42
Paying off the mortgage on your home	45	39	53	34	66	37	12
Have a formal, long term superannuation savings plan	47	34	57	35	61	50	31
Bank or term deposit investments	33	30	34	17	37	51	45
Investing in shares	31	22	39	21	34	49	33
Residential property other than your own home	18	12	22	15	18	24	12
Unit trust investments	17	11	22	11	20	23	17
Investing in your own business	17	14	18	9	28	19	2
None	17	23	9	31	3	12	29
Don’t know	1	2	-	-	1	-	7

AMP Superwatch asked: Do you anticipate selling your family home and moving to a smaller home when you retire?

50% of respondents intend to sell the family home when they retire.

38% said no.

13% were unsure.

This statistic is relatively constant across all income and age bands, except people aged over 65, 24% of who intend to sell, 41% don't intend to sell and 36% don't know.

		Income		Age
Intend to Sell Family Home when Retire	% Total N=474	% <$50K N=186	% $50K+ N=246	% 18-34 N=176	% 35-49 N=178	% 50-64 N=78	% 65+ N=42
Yes	50	47	52	52	56	44	24
No	38	38	38	32	39	46	41
Don’t know	13	15	10	16	5	10	36

AMP Superwatch asked: Do you expect to make a profit on the sale when retire?

83% expect to make a profit.

Those aged 50 to 64 aren’t so confident, as only 74% said they expected to make a profit.

		Income		Age
Expect to Make a Profit on the Sale of Family Home	% Total N=235	% <$50K N=87	% $50K+ N=128	% 18-34 N=91	% 35-49 N=100	% 50-64 N=34	% 65+ N=10
Yes	83	83	84	82	87	74	80
No	13	14	13	11	12	21	20
Don’t know	4	3	3	7	1	6	-

AMP Superwatch asked: Do you expect to use the profit from the sale to help fund your retirement?

Of those who expect to make a profit on the sale 81% expect it to help fund their retirement. Except those aged 50 to 64 years, where only 60% expect this profit to help fund their retirement.

		Income		Age
Use Profit from Sale of Family Home to Fund Retirement	% Total N=195	% <$50K N=72	% $50K+ N=107	% 18-34 N=75	% 35-49 N=87	% 50-64 N=25	% 65+ N=8
Yes	81	79	79	80	89	60	75
No	19	19	21	19	12	40	25
Don’t know	1	1	-	1	-	-	-

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