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How do you work out how much money you need in retirement?

This is a core part of the financial planning work that Moneyworks does with our clients. We do a Retirement Savings Analysis as part of the initial financial plan and then review progress towards those goals regularly at our annual review meetings with clients. Having this framework is important as it helps you make all your financial decisions in an informed manner. However, if you don’t feel that working with a financial planner is the best solution for you, ANZ have launched an online retirement calculator to help you work out your own goals and targets.

KiwiSaver is becoming a core part of our clients retirement savings strategy, combined with their other investments.

There are many variables to take into account in this process including:

  • What age will you retire at?
  • How long do you think you will live for?
  • How much superannuation income do you expect to get from the NZ Government?
  • How much are you contributing to KiwiSaver?
  • Is your employer contributing to KiwiSaver for you?
  • What other income sources do you anticipate receiving?  Other superannuation or pensions?  Working part time for a few years?
  • What income do you need to live off in retirement?
  • What lump sum expenses are you likely to have in retirement (vehicle, whiteware, house maintenance, travel)?
  • What financial legacy do you want to leave?
  • What is your risk profile? Is is different for KiwiSaver and for your non-KiwiSaver investments?
  • What assumptions do you want to make?
    • What rate will inflation be at while you are saving for retirement? What will inflation be in retirement?
    • What investment return will you be aiming to get while saving? in retirement?
    • What tax rate will you be taxed at before retirement? After retirement?

If you prefer the ‘do-it-yourself’ approach, head over to the ANZ Retirement Calculator by clicking on this button. It will help if you have information on your existing investment values before you start the process. ANZ RETIREMENT CALCULATOR