How much capital do I need to retire comfortably on ?

[Beagle]

Roger you don't work for stuff.co.nz do you they seem to be as hot on this issue of how much do you need. The latest which you may have already read.
http://www.stuff.co.nz/business/mone...lion-by-age-65
Here is hoping we can generate better returns than what he is proposing in this article. Although based on history I would be glad of 5% as some years my investment return has been negative.

I think the media are stalking me lol including Paul Henry who had the segment a while back on the same topic.
Thanks Aaron, I'll look forward to reading that later today when I get some more time, better do some work now (to save for my retirement lol).

Anyway...I managed to dig this history of N.Z's super out for you and others to have a look through and I'll also enjoy reading it later. It looks at how they've tinkered with the system over the decades to make it more affordable.
http://www.goodreturns.co.nz/article...t-changes.html

[fungus pudding]

Fair enough Aaron. Many of you won't recall or perhaps aren't even aware that at one stage we did indeed have a national superannuation surtax, (sorry I can't remember when it was instituted and then subsequently abolished), but ostensibly it operated in a similar manner to the Australian scheme whereby retiree's with personal income over a certain level had their superannuation reduced by a certain rate for every extra dollar they earned.

In Australia as I understand it, a retiree with $72,000 of personal income becomes ineligible for their super, (its abated before that personal income threshold). I understand they have tinkered with this in their latest $35b deficit budget yesterday and a tougher system has been implemented.

IIRC...we are going back over 20 years here... it became something of a political football and was it Labour that promised to abolish it, someone help me out here please.

As a nation I agree that we probably need to have another look at super's affordability. Should someone earning north of $100K and 65 years old still be eligible for super ?

Yes. Any move to target super will have negative consequences. Best to encourage more people to retire on over 100k. You client on over 500k will be paying tax of over 155,000 and receive around 11,000 (if individual) so taxman is still up over 140k. I know a few people like that and they generally are very generous, especially with charitable donations. Certainly they don't need it, but there's no other single argument to support removing it.

[Aaron]

Food for Thought
http://www.stuff.co.nz/national/poli...ng-fall-behind

[artemis]

Food for Thought
http://www.stuff.co.nz/national/poli...ng-fall-behind

I expect to see more targeted assistance for low income people in the Budget rather than across the board increases. That fits with the government's investment approach, which I agree with.

[Beagle]

Food for Thought
http://www.stuff.co.nz/national/poli...ng-fall-behind

As a society I think we bend over backwards and turn cartwheels to support needy children in our society. The working for families child support system is incredibly generous and the more children you have the more you get to the point where some large families are eligible for circa $1,000 a week payments.

Surely I can't be the only one who is asking where does personal responsibility come into this ? If you can't afford to raise children properly why should other taxpayers be expected to subsidise your desire to have a large family when often those choosing to have one are least equipped to afford it ?

There's something fundamentally wrong going on here. Enough is enough, we raised two children without government assistance, why should I pay for families that may have only paid tax for a few years, if at all, that chose to have ten ?

If retirees who have earned the right to their superannuation through payment of taxes all their lives are better off than beneficiaries who haven't earned that right, then I have no problem with the apparent social injustice this situation appears to suggest.

As mentioned earlier, people over 65 are getting superannuation, this is not a benefit per se, its a super payment based on their contributions. The two types of payments continue to deserve to be treated quite differently because one is earned and the other should be pegged at a modest level to discourage state dependency by working age adults.

[BIRMANBOY]

LOL personal responsibility has, along with Elvis, left the building. Its a slippery slope that is lubricated by a constantly changing amount of socialistic government policies implemented to ensure politicians stay in power as long as possible. The classic case of good intentions undone by failure to understand the current realities of human nature.

As a society I think we bend over backwards and turn cartwheels to support needy children in our society. The working for families child support system is incredibly generous and the more children you have the more you get to the point where some large families are eligible for circa $1,000 a week payments.

Surely I can't be the only one who is asking where does personal responsibility come into this ? If you can't afford to raise children properly why should other taxpayers be expected to subsidise your desire to have a large family when often those choosing to have one are least equipped to afford it ?

There's something fundamentally wrong going on here. Enough is enough, we raised two children without government assistance, why should I pay for families that may have only paid tax for a few years, if at all, that chose to have ten ?

If retirees who have earned the right to their superannuation through payment of taxes all their lives are better off than beneficiaries who haven't earned that right, then I have no problem with the apparent social injustice this situation appears to suggest.

As mentioned earlier, people over 65 are getting superannuation, this is not a benefit per se, its a super payment based on their contributions. The two types of payments continue to deserve to be treated quite differently because one is earned and the other should be pegged at a modest level to discourage state dependency by working age adults.

[Beagle]

LOL personal responsibility has, along with Elvis, left the building. Its a slippery slope that is lubricated by a constantly changing amount of socialistic government policies implemented to ensure politicians stay in power as long as possible. The classic case of good intentions undone by failure to understand the current realities of human nature.

Sad but very true unfortunately. The irony that quite a bit of this well intentioned family support for these irresponsible breeders comes back to the government in the form of tobacco and alcohol taxes and TAB profits isn't lost on me.

[Bjauck]

...As a nation I agree that we probably need to have another look at super's affordability. Should someone earning north of $100K and 65 years old still be eligible for super ?...

I think it also depends on other assets owned and whether the person owns their own home or not. For example if a person has a multi-million dollar home should they receive the same state benefit as someone with a $250,000 home.?

What about pensioners who do not own their home at all and would therefore need to find rent out of tax paid income? The pensioner in the multi-million dollar mansion has an asset, the benefit derived therefrom remaining untaxed. This will increasingly be an issue for retiring Aucklanders as home ownership rates are falling.

I think any pension means testing should include all assets and not exempt the value of a home. Otherwise the system would encourage the acquisition of "palaces" as a way to store wealth and pass down to heirs.

[Bjauck]

...There's something fundamentally wrong going on here. Enough is enough, we raised two children without government assistance, why should I pay for families that may have only paid tax for a few years, if at all, that chose to have ten ? ..

Fair point to an extent. Though dictating family size would be Orwellian. Some people are net recipients of government largesse at certain points of their life and at other points become net contributors. Some of the children who were in poor families grow to be net contributors as a result of being able to grow up healthier as a result of government help to their poor parents.

I am not sure how any poorer family could avoid GST - unlike wealthier families who can afford to invest money. Granted in many cases it would not balance out other government credits and benefits over their lifetime. It would be great if you could target only the children for assistance. However some parents too may have had their earning capacity affected by accident or illness.

If you don't provide assistance to the poor families, then you may have to pay for security compounds, self-defence classes and weapons as those poor kids turn to crime. So increasing social division and deprivation could become more costly to the wealthier than the status quo of a tax supported comprehensive system of benefits.

Government help for raising kids is pervasive. There is state provided help to wealthy families too. Did your kids see the dental nurse, have an accident or go to a subsidised doctor or hospital? Did they go to a state school or even a private school?
http://www.scoop.co.nz/stories/ED130...ding-by-40.htm

[Aaron]

As a society I think we bend over backwards and turn cartwheels to support needy children in our society. The working for families child support system is incredibly generous and the more children you have the more you get to the point where some large families are eligible for circa $1,000 a week payments.

Surely I can't be the only one who is asking where does personal responsibility come into this ? If you can't afford to raise children properly why should other taxpayers be expected to subsidise your desire to have a large family when often those choosing to have one are least equipped to afford it ?

There's something fundamentally wrong going on here. Enough is enough, we raised two children without government assistance, why should I pay for families that may have only paid tax for a few years, if at all, that chose to have ten ?

If retirees who have earned the right to their superannuation through payment of taxes all their lives are better off than beneficiaries who haven't earned that right, then I have no problem with the apparent social injustice this situation appears to suggest.

As mentioned earlier, people over 65 are getting superannuation, this is not a benefit per se, its a super payment based on their contributions. The two types of payments continue to deserve to be treated quite differently because one is earned and the other should be pegged at a modest level to discourage state dependency by working age adults.

Totally agree on personal responsibility Roger why should, I pay taxes to look after someone else’s parents because they didn’t save enough for retirement, let them starve aye Roger it is their own stupid fault for voting in governments that didn’t put anything aside for them. Especially with their high health care costs enough is enough. Even worse if they earn more than me and don’t need a handout.

Money wasn’t put aside by previous govts for national super and we are running deficits now to cover it so that future generations can pay for it (generational responsibility??? I think it is called a Ponzi scheme) but that said I also think we have some responsibility to the people around us and our local community and our country. We should be providing national superannuation to those who need it for whatever reason they didn’t provide for themselves in retirement.(maybe they leveraged up before the great 2016/17 stock market crash and got wiped out). Think about that when tax cuts are offered as a bribe next elections without any proposal to make universal national superannuation affordable.
Everyone wants a handout no one wants to put into the pot. Most people if they have a couple of kids on an average income will be getting more out than they put in. I haven’t done the figures but suspect I have in dollar terms, as well as growing up in a safe caring society. I suspect if I was richer my views would change but I hope not.

Bjauck makes a good point about what sort of society you want to live in. A caring society with everyone contributing what they can (or are forced to through taxation) or a selfish uncaring one. You will know my personal view that the last election result indicated the latter.

The kids of these parents you talk about Roger didn't get to choose who their parents are. There is a hope that our support via taxes and government organisations that those kids will have a chance to do well for themselves and NZ and not just absolve their parents of any responsibility to raise their own kids.
Asset testing seems a bit harsher as we would end up forcing old people out of their expensive homes to fund their own retirement. Maybe we can afford to leave asset testing for a generation.

Sorry what was this thread about again I keep losing track with my rantings.