KiwiSaver trial beset by apathy

Apathy is proving to be KiwiSaver providers’ biggest challenge in helping New Zealanders prepare for retirement.

ANZ, the country’s biggest KiwiSaver provider, is working with the Financial Markets Authority and the Ministry of Business, Innovation and Employment on a behavioural insights trial designed to help people aged 55 to 64 make decisions about their retirement.

Randomly selected KiwiSaver members are receiving targeted communication encouraging them to check they are on track.

But ANZ’s general manager of wealth products, Ana-Marie Lockyer, said that while most members were happy to have been contacted, few did anything as a result.

‘‘What we’re finding still seems to be a level of apathy.’’

Of the small proportion who were prompted to action, most opted for a DIY approach with online tools. Projection calculators were most popular, Lockyer said.

Few took the option of financial advice, mostly citing a lack of time.

It comes as new research from the Financial Services Council (FSC) shows most retirees are reduced to living off only the pension after 10 years of retirement.

‘‘Those over 65 and retired think they need $655 per week to live comfortably. Our research shows that in reality they have, on average, $437 per week which is a shortfall of $218,’’ FSC chief executive Richard Klipin said.

‘‘This is a considerable gap which is even bigger for those who don’t own their own home.’’

He said people’s savings were running out not because they were spending excessively but because they needed more education and advice before retirement.

More than half the homeowners aged over 65 who were surveyed said they planned to sell their own house to fund retirement.