Financial nous key to retirement

Retirement Commissioner Diana Crossan delivers her message in New Plymouth yesterday.
Retirement Commissioner Diana Crossan delivers her message in New Plymouth yesterday.

Financial literacy is critical for future retirees in New Zealand, says Retirement Commissioner Diana Crossan.

Ms Crossan was in New Plymouth yesterday speaking at a retirement seminar run by the New Plymouth Positive Ageing Trust.

A push to increase education in finances and retirement in schools was a key point highlighted by Ms Crossan during the seminar.

While teacher resources were available, Ms Crossan said their implementation needed further development.

"We are excited about the growth in financial literacy at a tertiary level, however, we are worried about it at a school level," she said.

"If you don't learn to manage your dollars throughout your life, then it's not going to help you at all when you reach retirement."

About 80 per cent of over-65s in New Zealand own their home, which has led to a very low poverty rate of 8 per cent within that age group. Most people within that 8 per cent experiencing hardship were renters.

Ms Crossan said those in their 30s and 40s were continuing to trickle out of the housing market, which could prove dangerous come retirement time.

"We just know our retirement income framework is predicated on people owning a house.

"The concern is to have that (80 per cent) dropping to 30 per cent for those 30 and 40-year-olds. How are they going to cope?"

New Plymouth Positive Ageing Trust chairman Jeff Blyde said the knowledge and information shared by Ms Crossan had been of great value.

"With Positive Ageing there's a perception that we deal with older people, but our issues are the issues of the future generation," he said.

There was always talk of the "baby-boomers", however it was the generation below who needed to take note, Mr Blyde said.

"To hear Ms Crossan put those statistics up and talk about financial literacy . . . it's that younger generation who need to be here listening to this."

Government projections show between 2005 and 2050, the number of New Zealanders eligible to retire is expected to double, meaning there will be fewer working-age people whose productivity can be tapped to fund New Zealand Superannuation.

Ms Crossan said her main objective was to ensure the New Zealand Superannuation Fund was sustained. "It really is a national treasure and we have to hold on to it," she said.

Yesterday's seminar was the second put on by Positive Ageing Trust, and Mr Blyde said more would follow.

"The last two seminars we've done have been fantastic and it's a sign that people are interested in what's happening with their future," he said.

Ms Crossan yesterday credited the Taranaki group as having the best programme for the ageing population in the country.

Taranaki Daily News