How much capital do I need to retire comfortably on ?

[JBmurc]

IMHIO Kiwisaver will become "compulsory" and in time the nation super will be nothing more than a small credit per week compared to living costs this will happen because of more kiwi's in retirement and more on a benefit (I don't see the future being more labour intensive than present more robots / machines etc.. all banking will be online or ATM ... factories , retail , retail ..etc

I know of many wealth baby boomers that have actually tired to stop their super payments ...as in their eyes its just stupid they have passive incomes upwards million + per year ... they see it better to go to those that need it ,,, wonder how many retired kiwis think the same...

[Bjauck]

The difference between a benefit for a young person in their early twenties and the superannuation of that of a retired person in their late sixties is that one is a temporary welfare benefit paid to encourage people who into full time work, many of whom have been doing nothing but suck off the taxpayers teat since they were in nappies through the education and family support welfare system and have never contributed a cent to society whereas the latter is an entitlement often earned through contributions to the taxation system for circa 50 years...pretty simple difference really, surely anyone can understand this fundmental difference for goodness sake....

I must admit I think that no government payments/benefits can be treated as entitlements. They are all dependant on the policies of the government of the day and the strength of the various lobby and interest groups that influence that government. NZ super is not a specific contributory scheme and is paid from general taxation. When the NZ old age pension was originally introduced, it was subject to a means test. As the disparity of wealth and income in NZ has regressed to Victorian or Edwardian era levels, maybe it is time to reintroduce the means test (provided settlors' wealth tied up in discretionary family trusts is also taken into account). Government payments targeted for need are a much more effective use of taxpayers' money.

[Aaron]

Dear Roger
Not sure how old you think I am, I suspect you have a few years on me but my university education was free(taxpayer funded). I think a small level of fees for university students is a good idea as it will help them focus on what is important. I remember my days at Uni as a lot of fun (maybe too much drinking and not enough study) admittedly I never worried about money or the future back then(poor decision in hindsight). I am concerned that the level of fees required to get a degree is getting to the point where only those kids who have the backing of well off parents can do it, creating a class society. I like the idea that every kid born in NZ has the same chance at a good education. They do what they like with their lives after that but at least they can't say they weren't given a chance. If they do well they can contribute through taxes if they don't then hopefully they aren't just bludgers. Anyway this is off track for the nat super debate.

In the words of Doctor Lisa Marriot. Who you can assume is a lot smarter than me, I have a degree but had to work hard for it as I am of only average intelligence at best.
The fiction
Many believe that New Zealand Superannuation is an entitlement.
Indeed, the universal nature of the pension is one of its many strengths.
Our health system is largely universal, but health care is provided according to need - to those who are sick.
So, why do we automatically pay a pension to those who have no need for the funds?
For argument's sake, New Zealand Superannuation could be tapered back for people with incomes over $50,000 and eliminated by the time this income is $100,000.

In conclusion I enjoy the anonymity of a website debate but hope that we could still share a beer at an Auckland Share Trader meeting one day without letting our difference of opinion get in the way.

[winner69]

Dear Roger
Not sure how old you think I am, I suspect you have a few years on me but my university education was free(taxpayer funded). I think a small level of fees for university students is a good idea as it will help them focus on what is important. I remember my days at Uni as a lot of fun (maybe too much drinking and not enough study) admittedly I never worried about money or the future back then(poor decision in hindsight). I am concerned that the level of fees required to get a degree is getting to the point where only those kids who have the backing of well off parents can do it, creating a class society. I like the idea that every kid born in NZ has the same chance at a good education. They do what they like with their lives after that but at least they can't say they weren't given a chance. If they do well they can contribute through taxes if they don't then hopefully they aren't just bludgers. Anyway this is off track for the nat super debate.

In the words of Doctor Lisa Marriot. Who you can assume is a lot smarter than me, I have a degree but had to work hard for it as I am of only average intelligence at best.
The fiction
Many believe that New Zealand Superannuation is an entitlement.
Indeed, the universal nature of the pension is one of its many strengths.
Our health system is largely universal, but health care is provided according to need - to those who are sick.
So, why do we automatically pay a pension to those who have no need for the funds?
For argument's sake, New Zealand Superannuation could be tapered back for people with incomes over $50,000 and eliminated by the time this income is $100,000.

In conclusion I enjoy the anonymity of a website debate but hope that we could still share a beer at an Auckland Share Trader meeting one day without letting our difference of opinion get in the way.

She a plonker that Doctor Lisa Marriott picking on the elderly - she just does not get it.

Her passion is child poverty

[Bjauck]

She a plonker that Doctor Lisa Marriott picking on the elderly - she just does not get it.

Her passion is child poverty

I don't think her suggestion picks on most elderly. Her suggested income testing of pensioners with a graduated abatement of the pension for those individuals with incomes>$50,000 would hit a minority of seniors. Most seniors' wealth is in their owner-occupied homes (and investor housing) and not in income producing assets as that is what the NZ tax and benefit/subsidy system has encouraged. There is little tax to be had from long-term investor rental housing.

In fact a means tested pension may mean that pension rates are more likely to be maintained at current rates and starting age for those who need it to survive. Maybe one of her passions is to alleviate poverty in general. I would suggest that were means testing introduced, it should also be an asset test (with appropriate threshholds) extending to all assets including owner-occupied housing and family trust assets.

[Aaron]

I don't think her suggestion picks on most elderly. Her suggested income testing of pensioners with a graduated abatement of the pension for those individuals with incomes>$50,000 would hit a minority of seniors. Most seniors' wealth is in their owner-occupied homes (and investor housing) and not in income producing assets as that is what the NZ tax and benefit/subsidy system has encouraged. There is little tax to be had from long-term investor rental housing.

In fact a means tested pension may mean that pension rates are more likely to be maintained at current rates and starting age for those who need it to survive. Maybe one of her passions is to alleviate poverty in general. I would suggest that were means testing introduced, it should also be an asset test (with appropriate threshholds) extending to all assets including owner-occupied housing and family trust assets.

Well said Bjauck.
Interesting article in the Herald this morning from Gareth Morgan re national superannuation. Can't find it online so can't share link but he has a solution in tomorrows paper. Stay tuned.

National's solution appears to be to cut tax rates before the next election if they can squeeze out a surplus before then. This seems almost completely absurd but you can't deny their success last elections and reading some of the comments below Lisa Marriott's (hilarious and scary) this could be the way to go for them to win the next election. I am not convinced this is the best solution to the issue but it is probably based on sound neo liberal principals such as "trickle down" and "people can look after themselves without government interference provided we have a good police force to enforce property rights"

[Aaron]

An opposing view
http://www.stuff.co.nz/dominion-post...he-same-basket

Her argument is that national super is an entitlement. A view shared by many on this thread. The article seems to ramble a bit so can someone clarify why she is of the view that it is an entitlement for all over 65yrs. Not the "I've paid tax all my life" chestnut. There hasn't been a fund built up over years of govt deficits, gareth morgan describes it as a Vaucous argument and goes on to show why it is Vaucous. If we can get over the emotion maybe govts could have a realistic look at solutions. It is a bit like mentioning capital gains tax 7 or 8 years ago.

[winner69]

Even if really wishy washy well said Rosemary. She a good soul.

Taking money (the root of all evil anyway) out of the discussion just remind ourselves that one thing that has never really changed in society over the centuries is that the younger generations look after and take care of the old.

The challenge today for the younger generations is how that will continue to be, don't forget that one day you will be 'old'.

[Aaron]

Even if really wishy washy well said Rosemary. She a good soul.

Taking money (the root of all evil anyway) out of the discussion just remind ourselves that one thing that has never really changed in society over the centuries is that the younger generations look after and take care of the old.

The challenge today for the younger generations is how that will continue to be, don't forget that one day you will be 'old'.

No one is suggesting that we stop looking after old people in fact the argument is how to make it sustainable so we can keep looking after old people not just for the current generation but future generations as well.

here is the link to todays Gareth Morgan article. Look forward to the solution tomorrow.
http://www.nzherald.co.nz/business/n...ectid=11466733

[Bjauck]

No one is suggesting that we stop looking after old people ....

True...it is all about how we can continue to look after pensioners, especially the vulnerable, in the most effective way. However it has never been a one way street. As statistics show, the just about to retire and the recently retired have, on average, the most assets of any age group. While they may be income poor, they are more often asset rich. Traditionally asset rich grandparents have helped their families with deposits and bills. In places like Auckland it may be the only way for many to get deposits for housing. However the disparity in wealth is increasing across all age groups in contemporary NZ.

As an aside I read in the Guardian that because of their recession and despite cuts, Greek pensioners provide the main income in up to 45 to 50% of households there. They had a particularly generous pension system which their government is loath to change further, despite pressure from the EU and IMF.