How Much Money Do You Need to Retire Comfortably in New Zealand - The Complete 2025 Guide

Discover how much you need to retire comfortably in New Zealand. Our comprehensive guide covers retirement costs, savings targets, hidden expenses, and expert tips to secure a stress-free retirement by knowing the true costs.

How Much Do You Need to Retire Comfortably in New Zealand

Updated 1 July 2025

Summary

We believe that most New Zealanders require between $300,000 and $1.3 million in retirement savings to maintain their current lifestyle, in addition to New Zealand Super.
With New Zealanders living longer per government data and the increasing cost of living making retirement expensive, our view is that there are three types of retirement - comfortable, modest and luxury.

We believe a modest retirement requires an annual household income of $50,000 to $70,000.

We believe a comfortable retirement requires an annual household income of $80,000-$100,000.
We believe a luxury retirement requires an annual household income of $120,000 or more.

Our View:

As a background, NZ Super provides an after-tax income of around $28,000 for singles and $43,000 for couples. If you're relying on NZ Super for a comfortable or modest retirement, your savings gap will be anywhere from $7,000 to $50,000 per year, which means a shortfall of anywhere from $140,000 to $1,000,000, depending on your lifestyle goals.
If you are planning for a luxury retirement, a household income of $120,000 or more per year will usually be required, which means having a significant amount of savings and investments to draw down on, given the limits of NZ Super.

To help explain what you need to know, our guide covers:

Know This First: The difference between a stressed retirement and a joyful one often comes down to this: can you say 'yes' to the things that matter without checking your bank account first? Achieving this freedom requires sacrifice in your earning years, but the payoff is priceless; retirement, where your biggest decision is what to do with your time, not whether you can afford to do it. With the government boosting KiwiSaver contributions, a surge in low-fee index funds, and abundant resources to guide your savings, our guide is here to clarify what truly matters for your financial freedom.

MoneyHub Founder Christopher Walsh Comments on Retirement Reality

"The brutal truth about retirement in New Zealand? Most people need a lot more money than they think; and far too many are unaware. I regularly speak with retirees who are genuinely struggling, not because they didn't save but because they underestimated the actual cost of retirement and made the fatal mistake of putting all their eggs in one basket.

I've watched what I call the "perfect storm" hit New Zealand retirees: soaring costs, longer lifespans, and a dangerous over-reliance on single assets. The statistics I see are tough to absorb. While NZ Super provides a foundation, it's barely enough to cover basic living costs, let alone healthcare emergencies or family support. NZ Super gives you about $28,000 if you're single and $43,000 as a couple, try living comfortably on that when your rates bill alone is $5,000, and your power bill hits $4,000 annually.

However, my biggest concern is the lack of diversification among New Zealand retirees. I see too many people betting everything on property, usually their family home plus maybe a rental. When property values stagnate or fall, when tenants stop paying, and when maintenance costs explode, these retirees have nowhere to turn. They're suddenly asset 'rich' but cash poor, and cash is in short supply in retirement.

The consequences of inadequate retirement planning are harsh. 'Struggle street' in retirement is real; it's choosing between heating and eating, between medication and a trip to the supermarket, between helping your kids and paying your bills. I've spoken to retirees who thought they were set for life with a $600,000+ property portfolio, only to find themselves borrowing money from their children within five years of retiring.

We've published this guide because I believe every New Zealander deserves better than financial stress in their golden years. The difference between a comfortable retirement and a desperate one often comes down to understanding the real costs, diversifying your savings across multiple asset classes and investing wisely in advance. Please don't let retirement become the most stressful period of your life, it should be the most rewarding".

Christopher Walsh
MoneyHub Founder

Know This: Many retirees discover too late that they need between $300,000 and $1.3 million in savings beyond NZ Super to maintain their lifestyle. However, proper financial planning can transform retirement anxiety into confidence about your golden years.

Our guide to retirement costs, created with insights from our friends at Lighthouse Financial, reveals the hidden expenses that catch most New Zealanders off guard - from $3,000+ annual rates bills to unexpected family support needs.

Lighthouse Financial provides personalised financial planning and advice that puts your goals first. Before giving advice, Lighthouse takes the time to understand what matters most to you.
Their services include budgeting, debt repayment, KiwiSaver, investments, property, and insurance.
If you're concerned about having enough to retire comfortably, understanding your true financial position is essential. Learn more about Lighthouse in our in-depth Lighthouse Financial review or visit their website.

Important: MoneyHub presents Lighthouse Financial as a trusted and well-regarded comprehensive financial advice service; however, this does not constitute an endorsement or recommendation. We encourage all readers to carefully and thoroughly compare financial advisers and fully understand their fee structures before making any decisions. You can also read our review of Lighthouse Financial.

Visit Lighthouse Financial

The Real Cost of Retirement in New Zealand - What You Need to Know

Our view is simple - NZ Super is not designed to provide for a lifestyle in any sense. It is a state benefit, much like the Jobseeker's Allowance. NZ Super is there to cover essentials, including heating, food, rates bills, and insurance. It arguably assumes retirees are homeowners with no mortgage outstanding. This means its generosity is limited, and the annual increase (in line with inflation) doesn't keep up with the true cost of living. Relying on NZ Super to cover retirement is likely to mean long-term financial hardship.

We classify three types of retirement below:

Modest Retirement ($50,000-$70,000 annually): This covers basic needs with some discretionary spending. You'll own your home outright, take occasional domestic holidays, dine out monthly, and maintain a reliable car. Healthcare costs are manageable (as you'll rely on infrequent GP visits and public health waiting lists), and you can help grandchildren occasionally.
Comfortable Retirement ($80,000-$100,000 annually): This enables the lifestyle most New Zealanders expect. You'll travel overseas every few years, eat out weekly or once a fortnight, drive a newer car (but probably not buy a new one), pursue hobbies actively, and handle unexpected health and dental expenses without stress using savings rather than relying on the public system. You can be generous with family and contribute meaningfully to causes you care about.
Luxury Retirement ($120,000+ annually): This enables a lifestyle fewer than around 20% of retirees enjoy. You'll have private healthcare (or self-insure for expensive surgeries) and regular dental check-ups, enjoy regular international travel, dine out frequently, drive new or newer cars, pursue extensive hobbies, and have financial freedom, allowing you to offer significant family financial support.

Know This: Many New Zealand households spend a lot more than $120,000 in retirement and don't fear doing so, but the purpose of this guide is to look at what the average New Zealander is expected to spend and why it's important to anticipate the true cost of retirement well before reaching 65 years of age.

Are the retirement income figures for a single person or a couple, and do they include NZ Super?

The figures above represent annual household income for both singles and couples and include NZ Super payments.
The amounts may seem low for couples as they assume a mortgage-free home and typical retirement expenses (e.g., $4,000+ rates, $3,000+ power, insurance, healthcare, and moderate travel).
For example, a couple targeting a comfortable $100,000 lifestyle (including $43,000 Super) needs ~$57,000 from savings, equating to just less than $2,000/week for expenses.
Higher costs like rent, mortgages, frequent overseas travel, or supporting family (e.g., adult children or grandchildren) require additional savings.

Warning: The Hidden Retirement Costs (Almost) Everyone Underestimates

Retirement is expensive - our list below explains what you need to be aware of and outlines the associated costs.

Healthcare

Private Health Insurance: Our research into health insurance costs suggests that premiums for a couple aged 65 and above can reach $10,000+ annually, with exclusions for pre-existing conditions. These costs force many retirees to face the cruel choice: pay premiums that eat 15% of their income or risk catastrophic medical bills.

Dental: Many retirees underestimate the costs of dental work. Major work (crowns, implants, bridges) can add up to $15,000-$40,000+ over a retirement period, in addition to ongoing hygenist visits and remedial dental work.

Pharmacy costs: Most essential medicines are covered by Pharmac, but many pharmacy items still need to be paid for even if they are subsidised.

Aged Care Reality Check: Rest home care averages $60,000-$80,000 annually, with hospital-level care exceeding $100,000. The asset threshold for subsidised care is around $285,000 (including home), meaning most retirees cover these costs with their savings (at least initially).

Council Rates

Rates: Average Auckland rates now exceed $4,000 annually per this Post article from June 2025, with many properties paying $5,000-$8,000 or more. Rates typically increase by 4-7% annually, which is significantly higher than the general inflation rate. This May 2025 Reddit post shows the discomfort causes by ongoing rates increases.

Regional variations from TaxPayers' Union data suggests Wellington rates average around $3,000, Christchurch $3,000, Hamilton $2,900. Even smaller cities like Tauranga ($3,500) and Queenstown ($3,500+) have substantial rates bills.

Know This: Unlike mortgage payments that eventually end, rates are permanent and ever-increasing, often at rates well above inflation levels. A $4,000 rates bill today becomes $8,000+ in 20 years at a 4% annual growth rate; NZ Super is very unlikely to keep up with rates bill increases.

Insurance

Home Insurance: Insurance premiums have doubled in many areas following earthquakes and floods, and many areas are becoming increasingly difficult and expensive to insure, as our guide outlines. You'll likely need to budget $2,000-$4,000 or more annually for comprehensive home insurance, as per our comparison research, with further increases likely as climate risks intensify.

Contents Insurance: Full replacement contents insurance for a typical family home costs $800-$1,500 annually. Many retirees under-insure, not realising the true significance of the replacement cost of their accumulated possessions.

Car Insurance: Comprehensive cover for older drivers can cost $1,500 to $3,000 annually, according to our comparison research, especially in Auckland.

Life Insurance: Many retirees drop life insurance to save premiums, but this can be catastrophic for the surviving spouse's financial security if debts are still owing upon death - this 2018 Stuff article is still relevant in explaining the risks.

The Bank of Mum and Dad Can Create Family Financial Pressure

Housing Crisis Impact on Retirement: According to Consumer's 2022 research, 14% of New Zealand parents provide financial assistance for their adult children's housing, with an average parental contribution of around $108,000 per child for house deposits.

The Divorce Domino Effect: Unfortunately, Adult children's relationship breakdowns often trigger financial crises requiring parental bailouts. This can happen when children are in their 30s or 40s, meaning parents will be close to retirement or in retirement. The costs that need to be covered can be significant, including legal fees, emergency accommodation, and child support gaps, all of which are frequently funded by retired parents who make withdrawals from their investments.

Grandchildren Costs: School fees, sports equipment, birthday parties, birthday and Christmas gifts all add up. It's not unusual for a set of grandparents to find minding grandchildren also expensive, as this historical Stuff.co.nz article from 2018 outlines.

The Guilt Factor: Many retirees sacrifice their financial security rather than say "no" to adult children. Our dedicated guide to preventing adult children from ruining your retirement explains how such emotional manipulation can significantly impact your retirement plans.

Multi-Generational Housing: Rising housing costs have forced more families into multi-generational living, given retirees face higher utility bills, supermarket costs and general expenses that become unaffordable without a nest egg saved.

Utilities

Power Price Explosion: Electricity costs are volatile; our comparison research is constantly changing, and a June 2025 Stuff.co.nz article confirmed that prices had risen by over ten per cent in the first half of 2025. Winter heating bills for older homes can exceed $400 per month, with annual power costs ranging from $2,500 to $4,000, according to our research.

Water Charges: Many councils are introducing water meters and charges as the costs of providing services. Wellington announced plans in December 2024, while Palmerston North has discussed the issue. Auckland's water charges add $600-$1,200 annually to household costs, and with other regions following, water will need to be paid for by all users.

Internet and Phone: Modern retirees require reliable internet for banking, healthcare appointments, and staying in touch with family. These costs add up per our broadband pricing and mobile comparisons. Currently, we estimate retirees spend between $80 and $120+ per month for adequate broadband and mobile services.

Transport: Beyond Just Fuel Costs

WOF and Registration Costs: Vehicle WOF costs continue to rise, as do registration fees. We recently named the oppressive administration fee on Road User Charges (RUC) for Electric Vehicles in our Fleeced Kiwi awards. Retirees with fixed incomes, unable to top up RUC in bulk, will be among the most penalised. Consider that older vehicles often require multiple WOF attempts, and it becomes clear that the cost of transport can be high for older New Zealanders.

Public Transport: While SuperGold cards provide off-peak concessions, many services are limited outside major centres. Taxis, ride-sharing services, and specialised driving services (such as Driving Miss Daisy) for medical appointments can cost $50-$100 or more per trip.

Car Replacement Cycles Retirees often keep cars longer but face higher maintenance costs. This means setting aside money for repairs as well as the eventual replacement.

Technology

Device Replacement: Smartphones last 3-4 years and will cost $800+ to replace, while laptops last 3-7 years (with a $1,000-$2,500 replacement cost), and televisions may last 7-10 years ($800+ to replace). Technology isn't optional anymore.

Subscriptions: Netflix, Spotify, cloud storage, antivirus software, medical alarms and other digital subscriptions can easily total $100+ per month for basic entertainment, health and security.

Food and Grocery Reality

Inflation Acceleration: Food prices have increased significantly since 2020, as illustrated in this 2023 Consumer Report. A couple's weekly grocery bill of $150 in 2020 is likely now over $200, with further increases likely.

Dietary Requirements: Age-related health conditions often require specialised diets. Gluten-free, low-sodium, and diabetic-friendly foods cost 20-50% more than standard options, and there's usually no going back to normal foods once you start, meaning these costs need to be factored in.

Dining Out: Retirement gives you a lot of spare time, and you'll likely have friends who want to meet for coffee, lunch, or dinner. Social dining is crucial for retirement, but prices at cafes and restaurants have surged. When you're working, going out is more affordable - it can be a struggle during retirement.

Legal and Professional Services

Wills and Trusts: Wills arguably should be reviewed every 3-10 years, costing $300+ per update. Enduring Powers of Attorney updates cost $300+, and you may want to consider a Living Will too.

Tax Return Complexity: Investment income from multiple sources often requires professional tax assistance; annual tax preparation costs range from $300 to $800 for complex returns.

Financial Advice Fees: Comprehensive financial planning costs $2,000 to $5,000 initially, with annual reviews ranging from $500 to $1,500. This is arguably essential but often unexpected costs.

Seasonal and Cyclical Costs

Heating and Cooling: Climate change increases both heating and cooling costs. Heat pumps, insulation upgrades, and higher utility bills can add $2,000 to $5,000 or more to your annual expenses.

Garden Maintenance: As you age, mowing the lawn and working in the garden may become less realistic. Professional garden maintenance costs over $100 per visit, with quarterly visits being common. Annual garden costs, including plants, tools, and services, can cost $2,000 to $5,000.

Holiday and Gift Inflation: Christmas, birthdays, and weddings all add up, and attending these events and buying gifts can become expensive.

Christopher Walsh comments:

"These aren't 'maybe' costs, they're guaranteed costs. I've never met a retiree who didn't face at least half of these expenses, usually all at once. The reality is that just when your income drops to its lowest point in 40 years, life hands you the biggest bills you've ever seen.
I call it the 'retirement perfect storm': your income halves, your expenses can double, and your time to fix it runs out. The retirees who survive this situation saw it coming and prepared. The ones who suffer are those who thought NZ Super and their mortgage-free home would be enough. Spoiler alert: it's not".

Lighthouse Financial provides personalised financial planning and advice that puts your goals first. Before giving advice, Lighthouse takes the time to understand what matters most to you.
Their services include budgeting, debt repayment, KiwiSaver, investments, property, and insurance.
If you're concerned about having enough to retire comfortably, understanding your true financial position is essential. Learn more about Lighthouse in our in-depth Lighthouse Financial review or visit their website.

Visit Lighthouse Financial

Income Replacement: How Much of Your Current Income Do You Need?

Traditional financial guidance suggests you may need around 60% of your pre-retirement income for a comfortable retirement. However, we believe this outdated formula ignores the modern reality of living in New Zealand.

Our view is simple - the replacement percentage varies dramatically by pre-retirement income level, and getting it wrong means either over-saving (and missing out on life) or under-saving (and facing financial stress in retirement). Generally, we believe:

High Earners ($100,000+): Need 60-65% replacement due to lower eliminated work expenses.
Middle Income ($50,000-$100,000): Requires 75-85% replacement to maintain their current lifestyle, which will neither improve nor worsen in retirement if the income percentage is replaced.
Lower Income ($50,000 or less): Must replace 90-100% as basic living costs remain fixed regardless of income, given the general cost of living in New Zealand and the costs incurred when just buying the basics to live.

Know This: The 60% rule was created for American retirees but Americans have different living and housing costs, tax structures, healthcare costs, and pension systems. Relying on the rule is easy to do - many New Zealand financial experts share their enthusiasm for 60% or 70%, but we believe it's not accurate and risks a miserable retirement.

Christopher Walsh comments:

"The 60% income replacement rule isn't realistic because it's dangerous financial advice dressed up as wisdom. It assumes your costs magically disappear when you retire - they don't. Your rates bill doesn't shrink, your power company doesn't give pensioner discounts, and your car doesn't break down less often. Your Super Gold card only goes so far, and medical costs climb.
Most New Zealanders arguably need a much as 80-90% of their working income to maintain the same standard of living in retirement. Anyone telling you otherwise is either selling you something or hasn't contemplated the true costs of living in New Zealand as a retiree".

Understanding the 25x (4%) Rule - Adjusted for New Zealand Reality

The global benchmark suggests saving 25 times your annual expenses (enabling 4% annual withdrawals, known as the 4% rule). Need $40,000 beyond NZ Super? Save $1 million. However, the 4% rule requires adjustments for our tax system and PAYE rates, NZ Super payments, and inflation.

Age-Based Savings Benchmarks:

By Age 30: 1x annual salary saved
By Age 40: 3x annual salary saved
By Age 50: 6x annual salary saved
By Age 60: 10x annual salary saved
By Age 65: 12-15x annual salary saved

Know This: These targets assume comfortable retirement goals and include all savings (KiwiSaver, investments).

Income-Specific Savings Targets

The numbers below assume 20 to 30+ years of consistent saving and reasonable investment returns. Start late, and you'll need to save 40-50% of your income to catch up - often impossible without dramatically reducing your current lifestyle.

$50,000 Annual Salary:

Target Retirement Fund Size: $600,000-$800,000
Combined with NZ Super: Delivers $65,000-$75,000 retirement income
Lifestyle: Modest to comfortable retirement

$75,000 Annual Salary:

Target Retirement Fund Size: $900,000-$1,200,000
Combined with NZ Super: Delivers $80,000-$90,000 retirement income
Lifestyle: Comfortable retirement with occasional luxuries

$100,000 Annual Salary:

Target Retirement Fund Size: $1,200,000-$1,600,000
Combined with NZ Super: Delivers $90,000-$105,000 retirement income
Lifestyle: Comfortable retirement with regular travel

$150,000+ Annual Salary:

Target Retirement Fund Size: $2,000,000+
Combined with NZ Super: Delivers $120,000+ retirement income
Lifestyle: Luxury retirement with financial freedom

Christopher Walsh comments:

"The 4% rule was designed for American retirees with different tax systems, healthcare costs, and living expenses. I am unsure if it still applies to New Zealand in 2025 and beyond, and we are looking to update our guidance on this matter in dedicated MoneyHub guides.
What worries me is seeing people calculate they need $800,000 based on this rule, then discover they're burning through money twice as fast as expected because they didn't account for our unique cost pressures. The 4% rule might work if you're planning to live modestly, but if you want to enjoy retirement, you need the New Zealand reality adjustment.

Our Five Must-Know Tips to Prepare for Retirement

Even the most diligent saver and investor can still find themselves unprepared for the true cost of retirement. We list essential tips to help you stay aware of what waits ahead.

Tip 1: Don't Trust Your KiwiSaver Statement Balance

Your KiwiSaver statement shows your current balance, but it doesn't show what that money will buy in retirement. This fundamental misunderstanding leaves thousands of New Zealanders drastically underprepared.

The Inflation Reality Check: A $100,000 KiwiSaver balance looks impressive today, but in 20 years, it will have the purchasing power of roughly $62,500 in today's dollars (assuming 2.5% annual inflation). Factor in New Zealand's actual cost inflation - council rates rising 4-7% annually, insurance premiums doubling, healthcare costs exploding - and your real purchasing power shrinks even faster.

What You Must Do: Always calculate retirement needs in today's purchasing power, then inflate those numbers by your expected retirement timeline. A comfortable retirement requiring $80,000 annually today will need $128,000+ annually in 20 years just to maintain the same lifestyle. New Zealand is becoming more expensive. You will need to consistently contribute to your retirement funds throughout your life to achieve financial freedom in retirement.

Tip 2: Diversify Beyond New Zealand Property or Face Concentration Risk

Most New Zealand retirees face a significant concentration risk - too much wealth tied up in property, particularly their family home, plus possibly one rental property. Our guide explains the risks of investing in property and how it's often not suitable for retirement. When property values stagnate, maintenance costs skyrocket, or tenants stop paying, these retirees discover they're asset-rich but desperately cash-poor.

Tip 3: Understand Why New Zealand Retirement Calculators Don't Factor in Real Costs

We believe KiwiSaver retirement calculators may underestimate your true needs given inflation and the general cost of living.

Most retirement calculators are designed for American or Australian markets and miss New Zealand's unique cost pressures. They account for basic living expenses but ignore the reality of New Zealand retirement, including:

Skyrocketing council rates increasing at 4-7% annually
Increasing insurance costs, including water bills being introduced into many areas
Healthcare costs paid privately, a proven alternative to the growing waiting lists on the public system
Technology replacement (iPhones, hearing aids, iPads, etc) that weren't factors for previous generations

We believe there is a risk that retirees can feel more confident about their future because calculators don't take into account these significant costs that continue to increase.

Tip 4: Build Proper Emergency Reserves

We suggest saving 3-6 months of expenses in emergency funds. However, there is a risk that retirement reality demands 6-12 months because retirement emergencies are relatively more expensive because home maintenance can't wait for payday, health crises are more expensive and frequent, and you can't earn extra income through overtime. You need to have funds available to pay bills when they are due, and there is no way to predict what your big item costs will be.

For this reason, we suggest keeping 6-12 months of expenses in high-interest savings accounts or term deposits. This money earns lower returns compared to growth-focused investment funds but it provides crucial liquidity when retirement emergencies strike.

Tip 5: Build Your Buffer Zone Strategy

We suggest adding 25% to all retirement expense projections to account for hidden costs and inflation surprises. An example of a Buffer Zone calculation:

Planned retirement budget: $70,000 annually
25% buffer addition: $17,500 annually
Revised target: $87,500 annually
Additional savings required: $437,500 (using the 4% rule)

Know This: We believe it's better to have excess savings and enjoy financial peace than face lifestyle cuts in your 80s when your options are limited. The difference between a comfortable retirement and a desperate one often comes down to this buffer.

You can build a buffer by increasing your savings rate or spending 25% less than your projected retirement income. Either approach provides crucial protection against the unexpected costs that ambush most retirees.

Christopher Walsh comments:

"These five tips aren't suggestions, they're survival strategies. I've developed them after hearing from or seeing first hand hundreds of New Zealanders thriving or struggling in retirement. The difference between these two groups isn't luck or inheritance, it's following these exact principles.
The retirees living their "best lives" are those who diversified beyond property, built proper buffers, and understood that retirement calculators don't always mean reality. Please don't ignore the warnings - retirement is too important to leave to chance".

Lighthouse Financial provides personalised financial planning and advice that puts your goals first. Before giving advice, Lighthouse takes the time to understand what matters most to you.
Their services include budgeting, debt repayment, KiwiSaver, investments, property, and insurance.
If you're concerned about having enough to retire comfortably, understanding your true financial position is essential. Learn more about Lighthouse in our in-depth Lighthouse Financial review or visit their website.

Visit Lighthouse Financial

Retirement Planning Checklist by Age

Retirement doesn't need to be tough - our checklist below can be used at any age to grow wealth and help you live your golden on your terms:

Your 20s: Building the Foundation Checklist

Priority Actions:

Consider joining KiwiSaver immediately
Consider choosing a growth fund option
Build an emergency fund covering 3-6 months of expenses
Establish a habit of saving 15-20% of gross income (including KiwiSaver)
Research first home purchase options if homeownership fits long-term plans

Common Mistakes to Avoid:

Avoid lifestyle inflation as income increases
Don't delay joining KiwiSaver
Don't choose conservative funds too early in your career unless they suit your short-term needs

Your 30s: Accelerating Accumulation Checklist

Priority Actions:

Reassess KiwiSaver contribution rates - the more you put in, the better your retirement
Review and potentially change KiwiSaver fund choice if your fund is under-performing
Begin investing outside of KiwiSaver
Obtain life and income protection insurance (if you have risks that need to be covered, e.g. mortgage and family)

Key Considerations:

Balance children's costs with retirement savings priorities
Remember, retirement savings benefit from a longer compounding period

Your 40s: Peak Earning Years Checklist

Priority Actions:

Target having 3-6x annual salary saved by mid-40s
Reassess investment mix while maintaining growth focus
Begin a detailed retirement planning process

Mid-Life Reality Check:

Compare actual savings to age-based targets
Implement aggressive catch-up strategies if behind targets
Maximise high-income earning years

Your 50s: Transition Planning Checklist

Priority Actions:

Consider gradually shifting to a less aggresive or growth-focused investment mix
Plan for potential early retirement or career changes
Develop detailed retirement income planning

Wealth Preservation Focus:

Preserve accumulated wealth while finishing the accumulation phase
Balance growth and security in investment approach

Early 60s: Final Preparation Checklist

Priority Actions:

Fine-tune asset allocation for retirement phase
Plan optimal KiwiSaver withdrawal timing (age 65)
Consider part-time work transition strategies
Optimise retirement timing based on financial position

Final Optimisation:

Review withdrawal strategies to minimise tax impact
Ensure all retirement income sources are coordinated

Immediate Actions Checklist (This Month)

Calculate Your Current Position

List your KiwiSaver balance
Document investment account values
Calculate property equity (home valuation less mortgage balance)
Value any business interests
Calculate total net worth
Identify savings gap amounts

Optimise KiwiSaver

Review current contribution rates
Confirm you're maximising employer matching (for example, if your employer matches above the minimum levels, consider increasing them to the limit)
Assess if fund choice suits your age and risk tolerance
Compare providers to identify potential fee savings
Make any necessary changes to contributions or provider

Project Your Retirement Needs

Estimate retirement expenses based on desired lifestyle
Factor in inflation over your time horizon
Calculate required savings beyond NZ Super
Document retirement income target

Short-Term Actions Checklist (Next 6 Months)

Increase Savings Rate

Consider increasing KiwiSaver contributions and/or setting up a regular contribution from your bank account
Establish regular investment contributions outside KiwiSaver
Implement chosen savings rate increase

Diversify Investments

Review current asset allocation across all accounts
Increase international diversification if needed
Consider professional investment advice for portfolios over $200,000
Implement any recommended portfolio changes

Protect Your Financial Plan

Review life insurance coverage adequacy
Review income protection insurance needs
Update or create current will
Establish enduring powers of attorney
Evaluate whether the family trust structure adds value by seeking legal advice

Ongoing Actions Checklist (Annual Review)

Monitor and Adjust

Conduct an annual review of progress toward savings targets
Rebalance investment portfolios to target allocations
Adjust contribution amounts based on income changes
Update retirement projections with current data

Stay Informed

Monitor any changes to NZ Super eligibility or payment rates
Stay current on tax law changes affecting retirement savings
Review and update retirement income projections
Consider any new investment or savings opportunities

Professional Advice Trigger Checklist
Consider seeking professional financial advice if you check any of these boxes:

Your total retirement savings exceed $200,000
You're significantly behind age-based savings benchmarks
You're within 10 years of planned retirement
You have complex family situations affecting your finances
You have business ownership or complex investments
You're considering major property investment decisions
You're planning a business sale or major asset disposal
You need help with estate planning strategies

Quick Reference: Age-Based Savings Targets

Age 35: Net worth equal to annual salary
Mid-40s: 3-6x annual salary saved for retirement
Age 50: Continue aggressive accumulation while preserving wealth
Age 60: Final preparation and withdrawal strategy optimisation

Our Conclusion

Retirement in New Zealand is expensive, and the cost is increasing every year. The numbers in this guide aren't designed to scare you, they're designed to prepare you for the financial reality of living comfortably after you stop working.

Here's what we know for certain:
NZ Super alone will not fund the retirement most New Zealanders expect. At $28,000 for singles and $43,000 for couples annually, it currently covers basic survival, not a luxurious lifestyle. If you want to travel occasionally, eat out regularly, maintain your health privately, and help your family when needed, you'll need significant savings beyond government support.

Most New Zealanders will require between $300,000 and $1.3 million in retirement savings to maintain their current standard of living. That's not a nice-to-have, that's the mathematical reality based on actual costs, inflation projections, and lifestyle expectations.

The hidden costs will find you whether you plan for them or not.
Council rates increasing at 4-7% annually, insurance premiums doubling after natural disasters, healthcare expenses exploding as you age, and family financial emergencies requiring your help. These aren't possibilities, they're probabilities that compound over a 20-30 year retirement.

Time remains your most powerful ally
Start saving seriously in your 20s and 30s, and a comfortable retirement is achievable. Wait until your 50s, and you'll need to save 40-50% of your income to catch up, often unrealistic without sacrificing your current quality of life.

What action looks like:

Consider boosting KiwiSaver contributions to 6-8% (in addition to your employer contribution) and choose an appropriate fund type LINK
Invest beyond property to avoid dangerous concentration risk
Build emergency funds covering 6-12 months of retirement expenses
Add a 25% buffer to all expense projections for unexpected costs
Review and adjust your plan annually, retirement planning isn't set-and-forget

Our view: A comfortable retirement in New Zealand is achievable, but it requires honest planning and consistent action.

Thousands of New Zealanders are enjoying financial freedom in retirement because they understood these costs early and prepared accordingly. They're travelling, pursuing hobbies, helping family, and living without financial stress, not because they were wealthy, but because they planned properly.
The difference between a comfortable retirement and a desperate one often comes down to starting early, saving consistently, and understanding the real costs outlined in this guide.
This guide is designed to provide you with the tools to build the retirement you want. Use them wisely, start today, and remember: every day you delay makes it harder to achieve your goals.
Your retirement lifestyle will thank you for the decisions you make today.

Frequently Asked Questions

I'm 55 and only have $100,000 in KiwiSaver. Is it too late to catch up?

It's not too late, but it is late. At 55, you're in what we call the "final sprint" to retirement. However, you've still got time, especially if you own your home. The key is to increase your contributions, consider part-time work into your late 60s or early 70s, and reduce your expected lifestyle costs.

Warning: Downsizing and/or moving to a lower-cost region to free up cash may not always be a wise financial decision - you'll incur significant real estate, legal, and moving costs and be isolated from your home while you 'start all over again'.

How much does a retired couple spend each year?

It depends on lifestyle, housing, and health. But based on our analysis:

A modest lifestyle costs around $60,000/year
A comfortable lifestyle costs around $90,000/year
A luxury lifestyle can exceed $120,000/year

Do I need $1 million to retire comfortably in New Zealand?

If you want to spend $60,000–$90,000 a year in retirement and aren't relying solely on NZ Super, then yes, something close to $1 million is a realistic target. That amount generates around $40,000/year in income using the 4% rule. Add NZ Super payments, and you're in the comfortable zone. You don't need to have $1 million, but you do need enough income-generating assets to fund your desired lifestyle for 25–30 years.

What's the biggest mistake New Zealanders make with retirement planning?

In two words: underestimating costs. Many people starting retirement don't factor in rising council rates, insurance, dental bills, and family emergencies. They also rely too heavily on NZ Super and property. The result? They hit retirement asset-rich but cash-poor, and realise too late that they can't afford the lifestyle they assumed would be automatic.

Is it better to rent or own a home in retirement?

Owning your home outright is the single most powerful advantage you can have in retirement. Rent is a cost that never goes away and will likely increase faster than NZ Super. If you're renting, you'll need hundreds of thousands more saved to generate income to cover rent. Homeownership offers security and drastically lower living costs.

Can I rely on investment property to fund my retirement?

Property can be a great asset, but it comes with risks, maintenance, bad tenants, rising costs, and illiquidity. If you're relying on rental income, it's not a guaranteed source of income. We've seen retirees caught off guard when their property sits vacant or they need cash quickly but can't sell it fast. Always balance property with liquid investments like cash funds or managed funds.

Is KiwiSaver enough to fund my retirement?

For most people, the answer is no, given the low average balances. Furthermore, KiwiSaver was designed as a supplement, not a full retirement solution. If you contribute the minimum, you're unlikely to reach the level needed for a comfortable retirement. But if you boost contributions to 6%–10%, add lump sums when possible, and stay in a well-performing growth fund early on, KiwiSaver can, over the long term, be a powerful tool, especially if you retire mortgage-free.

Should I keep investing in my 60s, or move everything to conservative funds?

It depends on your timeline and tolerance for risk. Many New Zealanders retire in stages, semi-retiring at 65, fully retiring at 70, and gradually drawing down their income. If you have a 20–30-year horizon, keeping part of your investments in growth assets makes sense. Going fully conservative too early can limit long-term returns and leave you short in your 80s and 90s.

How often should I review my retirement plan?

At least once a year, and anytime your life changes significantly (e.g., job change, inheritance, buying/selling property, family needs). Retirement planning isn't "set and forget." Costs change, your needs shift, and the earlier you adjust, the better prepared you'll be. Don't neglect this - it's critically important.

Will I pay tax on my retirement withdrawals in New Zealand?

It depends on where your income comes from:

NZ Super is taxed at your marginal rate.
KiwiSaver withdrawals themselves aren't taxed, the fund already pays tax on income/gains.
Investment income (dividends, interest, fund withdrawals) can be taxed depending on the structure.

Our guide to tax on investments has more details.

What's the best way to withdraw my retirement savings - monthly, annually, or as needed?

The safest approach is to set a sustainable monthly withdrawal rate based on a 4% annual drawdown (or less if you want to preserve capital). Monthly drawdowns make it easier to manage budgeting and avoid overspending. If markets dip, you can tighten your belt in the short term, annual withdrawals leave you more exposed to timing risk.

What if I want to help my children with house deposits, how much is 'too much'?

The answer is simple: only give what you can afford to lose without compromising your own retirement. Many parents help out with $50,000–$150,000 but end up needing to borrow or sell assets later. Your children can get a mortgage; you can't get one at 75. It's generous to help, but it's responsible to protect yourself first.

What happens if I get dementia or need long-term care? Who pays, and how much does it cost?

This is the question nobody wants to ask, but everyone should. Dementia affects 1 in 10 New Zealanders over 65, and the financial impact is devastating. Rest home care averages over $80,000 annually, with dementia-specific care costing over $100,000.

The government only helps pay once your assets drop below $285,000 (including your home). This means that most retirees will exhaust their entire life savings before receiving any assistance. A couple with $800,000 in assets could be completely depleted of savings within 5-7 years if one partner requires care.

My adult children keep asking for money - how do I say no without guilt?

Boundaries are financial protection. You are not a retirement plan for your children. Our guide covers this issue in detail. Frame it honestly: "We've worked hard to be financially independent in retirement, and helping you beyond what we already have puts that at risk." Saying no now could prevent you from needing their help in 10 years. a conversation they'll be glad you had (in many cases).

Lighthouse Financial provides personalised financial planning and advice that puts your goals first. Before giving advice, Lighthouse takes the time to understand what matters most to you.
Their services include budgeting, debt repayment, KiwiSaver, investments, property, and insurance.
If you're concerned about having enough to retire comfortably, understanding your true financial position is essential. Learn more about Lighthouse in our in-depth Lighthouse Financial review or visit their website.

Visit Lighthouse Financial

Related Resources

1. Retirement Planning and Income

2. KiwiSaver and Investments

3. Financial Independence and Early Retirement (FIRE)

4. Personal Finance and Wealth Building

5. Lifestyle and Support for Seniors

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