Ageing fast, saving slow: NZ's retirement timebomb keeps ticking
Like many other countries, our population is ageing rapidly and in just five years, we'll have more than one million people aged over 65.
'We're ageing
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
NZ Herald
5 hours ago
- NZ Herald
Shane Te Pou: 6 ways Christopher Luxon can save his Prime Ministership
Luxon spent enough time in corporate management to know that a CEO delivering numbers like that is in danger of getting the chop. He also likes to boast of his credentials in doing 'turnaround jobs'. Well, he needs one now. So, how can Luxon get his Prime Ministership 'back on track'? It's the economy, stupid New Zealand's economy isn't just bad – it's one of the worst in the developed world. We had a deep recession last year; other countries did not. And we're looking at round two. Partly, that's due to the Government suddenly cancelling, delaying or scaling back a bunch of infrastructure work, which contributed to the large loss of construction jobs. Partially, it's soaring energy prices killing our manufacturing sector. You can launch all the policies with energetic names like Investment Boost and Going for Growth you like; it doesn't matter if none of them move the needle. You spend your time trying to blame Labour for spending during a pandemic, while borrowing even more yourself for tax cuts; it doesn't create a single job. You can't spin away a crisis. It's time to take this seriously. Increase government investment and fix the energy shortage. Talk to us like adults You can practically hear the groans across the suburbs each Monday morning as Luxon whines 'well, what I would just say to you is' before repeating the same old talking points on his weekly media round. You're not trying to sell us soap, Mr Luxon. Show us you have a brain and treat us like we have brains, too. Give us genuine, considered thoughts and answers on the issues facing New Zealand. Is Christopher Luxon looking likely to be the first National Prime Minister to last only one term? Photo / Mark Mitchell Have a heart Before the National Party conference, party president Sylvia Wood said the problem is voters aren't seeing Luxon's 'humanity'. I agree. It's hard to see the humanity when he labels poor New Zealanders as 'bottom-feeders', scraps the pay equity process for 180,000 low-income workers and restricts access to emergency housing. If he is a humane guy, it's time to show it. As a Christian, Luxon must know Matthew 7:16: 'By their deeds you will know them.' Spend more time at home When Luxon said he was going to be a Prime Minister who didn't spend a lot of time inside the Wellington beltway, I don't think many of us realised just how far away he planned to be. I'm a man who likes to travel, but Luxon is taking it too far. At least one overseas trip a month, often on some pretty thin premises (what was he doing in Papua New Guinea the other week?) and with very little to show for it in diplomatic outcomes. Spend less time in the Koru Club and more time at the desk. Don't be afraid to change direction No one could accuse Luxon and his ministers of lacking self-confidence. They've ripped up ferry contracts, water reforms, light rail plans, the state house building programme, the RMA Act, the NCEA and more – all with the blithe assumption that they'll come up with something better. It's not exactly working out great, eh? Maybe it's time to revisit some of those impulsive decisions. Maybe it wasn't a great idea to borrow $14 billion for tax cuts and increase the Government's debt. Maybe, it's time to have the humility to adopt some of the Opposition's ideas, rather than reflexively scoffing at them. Pull the minor parties into line Luxon failed from the start to exert any authority over Act and New Zealand First's ministers. Casey Costello's dealings with tobacco companies should've seen her sacked. Karen Chhour's bootcamps disgrace would normally see the portfolio taken off her. Luxon's done nothing. Yeah, Winston Peters and David Seymour can threaten to pull down the Government if Luxon disciplines their ministers. But would they? It would cost them more than him. Have some guts – look them in the eye and see who blinks first. All is not lost for Luxon. But he's looking more and more likely to be the first National PM to last only one term, or less, unless he changes his ways.
NZ Herald
a day ago
- NZ Herald
Kiwis moving to Australia: Incomes, house prices and interest rates compared
It means houses in major Aussie cities cost about 6.5 times the typical salary compared with eight times in New Zealand. Even Sydney comes out ahead of Auckland, with its houses at 8.5 times the price of typical city salaries compared to 9.2 times in the City of Sails. And there are other pain points for New Zealanders. The Herald estimates Kiwis pay around $839 or 42% more at the pump each year for every 14,000km driven. Yet it isn't all good news in Oz. Sydney resident and former Aucklander Keitah Tuleitu's family were hit hard by a curveball last year. Having lived in Australia for seven years, they earlier told the Herald they had been feeling comfortable and planning to buy a house in 2024. Instead, they spent much of the year raiding their savings. 'I would say 2024's been a struggle because my husband did lose work for a period of time,' Tuleitu said when the Herald checked back in this week. It's a reality check that backs warnings from property commentator Nick Goodall of analysts Cotality for Kiwis to look beyond headlines about salaries. Goodall cautions that the big salary advantages from industries like mining can create the impression that every job is better paid in Australia and advises people to look closely at opportunities and hidden costs when pursuing their chosen professions. The exodus has worried many New Zealand commentators. The Herald's business editor at large, Liam Dann, has been warning of a brain drain as New Zealand's young, trained and educated people move to Australia. While new migrants from other countries are replacing many of the Kiwis who go to Australia, experts believe this creates a churn in jobs as people come and go and the most experienced are lost. Winners and losers: City-by-city comparisons Looking deeper into Australia's affordability advantage, some cities stand out as potentially better opportunities for Kiwis than others. Mining hotspot Darwin emerges as the ultimate financial sweet spot, boasting the highest salaries at $173,000 (NZD) yet the cheapest house prices at just $588,000, according to Australian National University income data and Cotality house prices. At the other extreme, Dunedin residents earn barely half what their Darwin counterparts make – resulting in a staggering $93,000 income gap between the highest and lowest-paid cities. Tauranga delivers another shock. Its $690 weekly rents now exceed Melbourne's $670 – a regional New Zealand city outpricing one of Australia's largest metropolises. The city salary pecking order tells a harsh story for New Zealand. All five top-earning cities sit across the Ditch, while New Zealand's best, Wellington, manages only sixth place, according to ANU and Infometrics' NZ income data. Comparing public servant hotspots, Canberra's residents typically earn $154,000 compared with Wellington's $134,500 – a $20,000 gap between the two capital cities. Adelaide leads the property growth with 7.8% in annual house price gains, while Wellington has suffered the steepest decline at minus 6.2%. New Zealand's Christchurch and Dunedin offer the cheapest rents in either country at $550 weekly – but Infometrics income data shows residents earn just $90,000 and $80,500 respectively. Keitah Tuleitu with her extended family. She's made Sydney home despite tough times last year. Pros and cons of life over the Ditch Cotality's Goodall said Kiwis are being drawn not only by better wages but also by a more optimistic feeling in Australia about the economy. Australia has weathered the downturn better than New Zealand, where unemployment has risen faster as house prices have stayed flat, he said. Kiwis have repeatedly listed higher salaries and strong economic prospects as the top attractions when talking to the Herald. Maths teacher Liam McMahon told in 2023 how he scored an instant $31,000 pay rise just by moving to Melbourne from Hamilton. Architect Kyle Anaru started 'accumulating savings straight away' after moving to the Sunshine Coast in 2023, while beauty therapist Bridget Jane told last year how she and her fiance left Queenstown on the hunt for salaries that better matched house prices. But Goodall's 'not all rosy' warning has also shone through in Herald conversations. Anaru was among Kiwis saying how hard it could be to find rentals, while Jane had to live far from Melbourne's centre for affordable rent and talked about a more high-pressure working environment in Australia. Teacher McMahon was also among many missing 'family, friends and Hamilton day trips', while others miss New Zealand's culture. Tuleitu, meanwhile, highlighted how the highs and lows can come in both countries. In 2023, she told the Herald how higher Sydney salaries had meant her family were living 'comfortably' while still donating to their church. It was in contrast to the struggle her parents had gone through in New Zealand, she said at the time. However, their recent struggles had forced them to 'pick' at their savings and reset their goals. Nevertheless, with most of her family having joined her in Australia, she has become an Aussie citizen and says she isn't coming home any time soon.
NZ Herald
a day ago
- NZ Herald
Rate-cut reality check - too little, too late: Nick Stewart
Higher starting debt, unfavourable interest rates, adverse growth trends and long-term pressures from aging and climate change are converging into a perfect storm. Despite claims of $44 billion in savings, the Government has reallocated spending rather than shrinking it. It's hard for hope not to fade when our government appears to lack the mettle to take the bull by the horns. The 'price of butter' facade may have fooled some, but not many. Butter is a product that hasn't changed in eons – full cream milk, add salt and churn. No smoke and mirrors or PR spin, just butter. Yet politicians obsess over its retail pricing while avoiding hard decisions on fiscal consolidation that might actually address underlying inflation pressures. The great capital migration Capital flows as freely as people in an interconnected world. Just as 230,000 Kiwis have voted with their feet over two years seeking better opportunities offshore, smart money increasingly looks beyond our borders for superior returns. The recent emigration shows a damning verdict on New Zealand's economic trajectory. These are productive citizens, who see limited prospects in a country determined to tax productivity whilst subsidising speculation. Human capital flight and financial capital mobility share parallels –both respond to incentives and seek the best risk-adjusted returns. Housing market dysfunction remains Our housing market remains in purgatory, with prices stubbornly elevated while transaction volumes are sluggish. Latest data shows 'days to sell' extending and prices slipping nationally for six of the past seven months. Wednesday's modest rate cut is unlikely to break this deadlock. Young Kiwis are emigrating, recognising their homeownership prospects have been systematically destroyed by policies prioritising incumbent wealth over economic dynamism. The social contract promising hard work would lead to homeownership has been broken: 72% of Kiwis without a home believe buying a property is beyond their reach. Yet, many Kiwis remain dangerously over-exposed to residential real estate. Rethinking investment The traditional Kiwi approach of leveraging into property and hoping for the best is dangerous where house prices may stagnate while debt service costs remain higher. Global equity markets continue to climb, with the S&P 500 delivering 5-year annualised returns of 15.71%. Meanwhile, New Zealand's NZX50 has delivered a dismal 1.8% annualised return over the same period. The performance gap is devastating. A $100,000 investment in the S&P 500 over five years would have grown to $208,000, versus approximately $109,000 in the NZX50. This $99,000 difference is a documented reality for investors who remained domestically focused while global opportunities compounded wealth at dramatically higher rates. Complexity extends beyond simple asset allocation. Tax implications vary dramatically between domestic and international investments. Currency hedging decisions can make or break returns. Liquidity needs must account for potential emigration scenarios – a consideration rational investors now embrace. Economic crossroads ahead New Zealand stands at an economic crossroads between fiscal irresponsibility leading to Japanese-style stagnation, or making hard decisions to restore economic dynamism. Next Wednesday's timid rate cut suggests we're choosing the former. For investors, the message is clear: adapt or suffer consequences. Capital, like talent, flows to where it's best treated. The 230,000 Kiwis who've recognised this reality are canaries in the coal mine. Smart investors should ensure their wealth enjoys the same mobility their fellow citizens have embraced. The coming rate cut won't be cause for celebration – it will be a symptom of deeper malaise and policy impotence facing structural decline. - Nick Stewart's iwi affiliations are Ngāi Tahu, Ngāti Huirapa, Ngāti Māmoe, Ngāti Waitaha).
