KiwiSavers plan to pay off mortgage
Many KiwiSaver members are planning to blow their money or use it to pay off the mortgage when they turn 65, a new survey has found.
AMP conducted an online survey asking more than 1000 workers about their plans for retirement, and found just over half knew what they wanted to do with their KiwiSaver money once they hit 65 and were eligible to withdraw it.
The survey found 15 per cent of respondents planned to use it to pay off their mortgage or other debt, 15 per cent plan to withdraw the money and invest it elsewhere, 14 per cent planned to withdraw the money and spend it, and 8 per cent planned to keep their money in KiwiSaver.
AMP chief customer officer Jeff Ruscoe said he was happy to see so many people had an idea what they wanted to do with their KiwiSaver funds.
He was not concerned by the number of people saying they would spend their money, saying it was up to individual savers to decide how they wanted to use it.
"For us it's about having a plan about what you want to achieve and how you are going to go about doing it," Ruscoe said.
"People's retirement is what they want it to be."
The number of people looking to use KiwiSaver to pay off mortgages "wasn't surprising at all" because the high level of housing debt and that many people were taking longer to pay off their mortgages.
Other results from the survey reveal the reasons why KiwiSaver members joined the scheme in the first place.
Six out of 10 are using it as a retirement savings tool, while 15 per cent are using it to save for their first home.
Another 15 per cent are in it to take advantage of government and employer contributions, 5 per cent said it "seemed like a good idea" and 5 per cent said their work had signed them up.
"The public are clear that they are in it because it's retirement savings," Ruscoe said. "Whether they have clear plans on what they want their retirement to be is where we need to focus."
It was important for people to understand what they wanted to do in retirement so they could save enough for it, he said.
"We're encouraging customers to think about whether they're in the right fund and what their contribution rate needs to be, because 4 per cent or 8 per cent might be too much or too little."