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Have You Financially Prepared For Your retirement?
The Financial Services Council (FSC) has released its latest Money & You research showing that 69% of women do not feel financially prepared for retirement.
Richard Klipin, Chief Executive Officer, FSC said, “The reality is that an estimated 2.3 million or 56% of New Zealanders aged 18 or over aren’t financially prepared for retirement, and the majority are women.
The report reveals that 42% of New Zealanders are contributing the minimum 3% and the two-thirds of employers (64%) are matching that, meaning many won’t have created sufficient KiwiSaver funds for even a ‘no frills’ retirement.
The FSC’s latest Money & You research shows that there is a general ‘Perception Gap’ that is blindsiding Kiwis financial management ability when planning for short-term and longer-term needs.
“It’s a balancing act that is harder in today’s high interest environment. Kiwis are having to manage on less day-to-day and make trade-offs between living today and saving up for a comfortable tomorrow.
The Perception Gap is created when there is a mismatch between confidence in making financial decisions and a real understanding of financial concepts, especially when it comes to more complex decisions around managing risk, investment and retirement.
The research shows that there is a 20% gap between the number of Kiwis that perceive financial confidence (82%) and those that have a real understanding of the four financial concepts tested (62%).
“Finances can get complicated, so whether your concern is short-term cost of living or long-term investment and retirement planning, talk with your provider or an adviser and close your Perception Gap – it will help improve your financial confidence and wellbeing,” concluded Klipin.
Top five tips to close your perception gap
1. Balance short-term day-to-day needs with a longer-term plan, you’ll be prepared and know where you are headed.
2. Keep a track on your finances and set a savings goal for your desired retirement lifestyle. 3. Check your KiwiSaver settings and make sure you are in the right type of fund to help build your retirement pot.
4. Find out how much you and your employer are contributing to your KiwiSaver and see if you can afford to sacrifice a little more today for your future retirement.
5. Seek advice and get help and support now to close your perception gap, don’t wait until it’s too late.
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