Should our Government ensure its pensioners don’t starve?

Guest Post:

NZ Super on its own is not an adequate income for retirees.

Those over 65 and retired think they need $655 per week to live comfortably. Our research shows that, in reality they have, on average, $437 per week, equating to a shortfall of over $200 per week. This is a considerable gap and even bigger for those who don’t own their own home.? This gap between expectation and reality sends a clear message to those of us still working to make the most of opportunities to grow our retirement nest egg and do everything we can to increase our sources of income in retirement.

Despite this, research shows

that many of us use all our savings and other assets?within ten years?of retiring. With the average person now expecting to be retired for 20 plus years, most retirees expect to live the last ten or more years of their lives on the government pension only.

So should the Government ensure retirees receive a livable income after exhausting their nest eggs?

Realistically we know this is never going to happen and there are good reasons why it shouldn’t.

For one thing, where is the money going to come from when the ageing baby-boomer population is increasing exponentially compared to the workforce?

And even if we could fund the money for a liveable pension, some people would abuse its availability the same way they never grew a decent nest egg in the first place.??They’d blow their savings in a heartbeat to access another source of funding for their latest car or overseas holiday.

Then there are the immigrants receiving the same retirement income a lifelong resident has paid 50 years taxes for.

Long story short, in our “golden years” we are on our own.

For the next generation, there is always KiwiSaver.??It’s a shame it’s not compulsory or at least with a tax adjustment option to make it more attractive to young entrepreneurs.