Source: Radio New Zealand
RNZ money correspondent Susan Edmunds. RNZ
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Why does the first person turning 65 in a couple only receive the reduced shared-superannuation amount? Why not the higher single-person amount, until the second person in that couple is 65?
You’re right that when the first person in a couple turns 65 and qualifies for NZ Super, they receive the sharing pension rate of $984.28 a fortnight before tax, not the rate for someone who lives alone, which is $1294.74.
That’s because the system is designed on the basis of shared living costs between a couple. The “shared” reference is in relation to a couple being able to split their household costs, not that they are sharing the pension itself.
“New Zealand’s social security system is built on the understanding that people in a relationship share costs and support each other financially,” the Ministry of Social Development confirms. “The different rates for couples are applied regardless of a partner’s eligibility for NZS.
“For example, if a New Zealander is over 65 and eligible for NZS, and they have a partner who is younger than 65, the person over 65 will receive NZ Super at the couple’s rather than ‘shared’ rate.”
I know there is debate from time to time about whether it is still appropriate to assume that couples share costs and are willing to support each other in the case of other types of government support.
Why does the Sorted KiwiSaver retirement calculator use the assumption that my income will have an annual increase of 3.5 percent? I find that to be a wildly out-of-date assumption.
If anything, my income has reduced, due to a decline in relative purchasing power. How can I find an honest, genuine forecast tool?
I asked Sorted about this. Personal finance lead Tom Hartmann told me that the assumptions used in calculators were what actuaries had advised were appropriate.
He said there had to be some assumption of income growth across a person’s career and that 3.5 percent figure was widely used.
He pointed out that, while it was probably unreasonable to think you were getting 3.5 percent wage growth consistently each year, people would go through periods where pay stagnated and then might shift to a new job, and their pay might jump up.
Over the past 10 years, the average annual growth rate was about 4 percent, although that included a period with a strong inflation spike.
It’s really hard to find a tool that will match an individual’s specific circumstances. I suppose your best option here is just to be aware of the assumptions and keep them in mind, when you’re looking at the calculations.
My wife has a KiwiSaver account with a modest balance. She is employed on a casual/oncall basis as a nurse at a medical practice.
She has not been called in since January, so no wages and no contribution to her saver account. She asked me if she should withdraw her KiwiSaver and put it in a term deposit.
She is 68 years old.
This really will come down to what you want or need the money for.
At 68, there are no restrictions on how and when she accesses her KiwiSaver money. If she’d like to have some available in a term deposit, she could withdraw the money to do so and keep her KiwiSaver account open to make contributions from her future work.
I’m not in a position to give personalised financial advice, but generally, people are told to align their investments to their investment profile. If you don’t need the money for a while, it’s usually worth keeping it invested with some exposure to growth assets.
KiwiSaver can be an easy way to do this, but if you do need the money now, it’s usually worth putting it in a low-risk investment, such as a bank deposit.
I’m a New Zealand citizen, have been a permanent resident in Australia for 50 years and worked in New Zealand for approximately four years. Where does that sit with qualifying for a pension from New Zealand?
You can use your time living in Australia to meet the New Zealand residency requirements for NZ Super.
While Australia’s pension is means-tested and people who move from New Zealand to Australia have to meet those requirements, that does not apply to Australians moving to New Zealand.
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