Kiwis in trouble if pay dries up

RICHARD MEADOWS
Last updated 12:59 25/07/2013

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Twenty-five per cent of Kiwis would not make it to the end of month if their main source of income dried up, a survey shows.

The research from credit card company MasterCard found that while most New Zealanders had the right intentions, with 89 per cent intending to save more, many live from pay day to pay day.

It was surprising that even post-recession a staggering 26 per cent believed they would not survive a month without their regular pay, MasterCard's NZ country manager, Albert Naffah, said

While most could make it through an average of four months, New Zealand still ranked bottom of the table in the Asia-Pacific region, equal with Australia.

Naffah said KiwiSaver had helped improve awareness of the importance of regular saving.

Besides precautionary measures, people were putting money aside for retirement (44 per cent), buying or renovating (33 per cent), international travel (31 per cent) or investing (28 per cent).

While retirement was the top priority, less than a third of respondents had calculated how much they needed to retire, ranking New Zealand 11th in the Asia-Pacific region.

Naffah said it would be interesting to see how mobile applications for money management affected Kiwis' financial skills.

One in five was using the technology - an increase of more than 50 per cent from last year - with a further 15 per cent considering doing so.

MasterCard surveyed 500 New Zealanders aged between 18 and 64.

The survey results follow research from the Commission for Financial Literacy and Retirement Income that found 71 per cent of people could access three months of income in an emergency.

However, only 42 per cent could get the money through their savings and investments.

The rest would have to sell something, take out a loan, hit up family for cash or make an insurance claim.

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- BusinessDay.co.nz

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