‘Redundancy used up a lot of our savings’
Anne Lewis thought that when it came to retirement, the savings she and her husband John had worked hard to accumulate throughout their working lives, topped up with NZ Super, would be enough to see them through.
But things didn’t quite work out that way. When John was made redundant in his early fifties from a management job he’d only been in for a couple of years, it had a huge impact on their finances. He only got a small redundancy payout and it took him nearly two years to get another job, which paid a lot less than he’d previously been earning.
“We went through just about all of our savings at a time when there were a lot of expenses, such as university educations for two of our kids,” says mum-of-three Anne (75). “It set us back, so that by the time we were due to retire, we couldn’t. We had very little money
in the bank, quite a few large debts and we weren’t mortgage-free.”
John (now 76) continued working until he was 68 and Anne didn’t retire from her part-time administration job until she was 70. They eventually sold their large family home and downsized to a townhouse, and the extra money that gave them has provided them with a small financial cushion.
“That has helped a lot, but it is still quite stressful,” says Anne. “I worry about money all the time. One thing that was difficult was the fact that most of our friends didn’t have to worry about money, while we did. They’d invite us out to dinner and shows, but we couldn’t go because we couldn’t afford it.”
Anne avoided seeing some of her friends because she was embarrassed that she couldn’t keep up financially. But she has remained close to others and says their support has helped in the tough times.
“It hasn’t been easy, but I don’t know what we could have done differently. I imagined we would be able to travel all over the world but that hasn’t been the case. We go to see our daughter and grandchildren in Australia once a year, but get the cheapest flights and save money by staying with her.”
Anne says they have tightened their belts by doing things, such as having one car instead of two and cancelling their Sky TV subscription.
“You just have to accept that you have to make concessions when you are retired. Luckily, we both still have our health, apart from a few minor niggly things, and that’s what is important at this age.”
Make savings by downsizing to a smaller home, only having one car and cutting down on entertainment.