How much do you need to retire?

Very few people think NZ Super is enough to live comfortably on, especially for people who do not own their own homes.

The most comprehensive research on the gap between what NZ Super currently pays, and the amount of income needed to live a ‘‘no frills’’ or a ‘‘choices’’ lifestyle in retirement, is done by Massey University’s FinEd Centre.

The latest 2019 version of the research showed a twoperson household who wanted a no-frills life in provincial New Zealand needed an extra $7.36 a week on top of NZ Super to achieve it.

A two-person household in a big city who wanted a ‘‘choices’’ lifestyle would have to add in an extra $800 a week.

The Massey researchers calculated that a two-person household living in the city would need to have saved just short of $790,000 to fund a ‘‘choices’’ lifestyle, while a couple living in the provinces would need to have saved just over $490,000.

Those figures assumed those people would slowly spend their capital, leaving nothing for the children.

Even a metropolitan twoperson household with a ‘‘no frills’’ lifestyle would still require savings of around $260,000 at retirement to supplement their superannuation, the researchers said.

Researcher Claire Matthews said an updated version of the research would be published within weeks.

It would show a modest rise in the income gap, and also the lump sums people needed to save to cover them, she said.

Common methods people use to save money to cover the gap included saving into KiwiSaver, property investing, downsizing the family home in retirement, and even using reverse mortgages to cover some spending needs, such as maintenance on the family home.

But those who do not have enough saved at age 65 can, if they are healthy, continue working if they can find an employer, or continue in selfemployment.

The 2018 Census indicated eight in 100 pa¯keha¯ people over the age of 65 were still working, compared to four in 100 of Ma¯ori, one in 100 Pasifika, and two in 100 Asian people.

Working past age 65 and saving and investing NZ Super can boost people’s retirement nest eggs, as well as enabling them to leave their existing savings and investments untouched, helping them amass money to close the NZ Super ‘‘gap’’.

If a couple both carried on working past 65, they would currently get $768.92 each a fortnight before tax in NZ Super payments they could save towards the day when they had to stop working.