Less than two months before the introduction of KiwiSaver, more than half of adult New Zealanders report they are not saving for their retirement, and more than three quarters admit they know very little detail about the new savings scheme.Less than two months before the introduction of KiwiSaver, more than half of adult New Zealanders report they are not saving for their retirement, and more than three quarters admit they know very little detail about the new savings scheme.
These are the two main findings of a recent public survey of 490 New Zealanders aged 18-64, undertaken by New Zealand investment and superannuation specialist, ING.
The online nationwide survey canvassed opinion from those eligible to save through KiwiSaver, the new voluntary, work-based Government savings initiative designed to encourage New Zealanders to save for their future.
The new scheme will enable employees to have part of their salary – either 4% or 8% – deducted automatically by employers and invested into an approved superannuation platform.
However, the results of the survey show there is a long way to go before New Zealanders are adequately informed about KiwiSaver. This comes against an already weak savings record among New Zealanders.
In the survey, only 13% said they felt they had their retirement savings completely under control, while more than half of those surveyed (53%) said they currently have no retirement savings pan.
According to the survey, while 62% of working age New Zealanders are aware that a workplace savings scheme is about to be launched, 78% said they knew few details of KiwiSaver.
Even those who felt they did know something about the scheme revealed clear knowledge gaps, after completing a brief true/false quiz on KiwiSaver.
The question answered incorrectly by most was about where KiwiSaver contributions would be invested, with over half (52%) believing funds will go into the New Zealand Superannuation Fund – the so-called Cullen Fund.
However, some of the survey data was positive, with other key findings including:
- New Zealanders appear open to workplace savings schemes. At present, 25% of working age adults are in a workplace where a retirement saving scheme is on offer, and where such a scheme exists, 56% of those surveyed take part.
- Of those who don’t have a scheme currently on offer, 60% say they would like to have that option.
- Of all those surveyed, only 13% said they were against the concept of KiwiSaver, while two thirds said they support the idea to some degree.
And highlighting the sea change in sentiment since the landslide anti-compulsion retirement saving referendum 10 years ago, 50% of those taking part in the ING survey now say they favour or strongly favour the concept of mandatory saving through the workplace, with only 28% against the idea.
Steven Giannoulis, ING’s General Manager Marketing and Investor Services, says the survey clearly shows that Kiwis understand the need for a mechanism to help them save for retirement and see direct deduction from their wages as the most appropriate way to achieve this.
ING, one of six government-appointed default providers for KiwiSaver, intends running the survey again in June, just prior to the launch of KiwiSaver on 1 July 2007.