Reality bites for Gen X

As a Gen Xer and someone who works in funds management, such figures act as a stark reminder of the age my generation is now reaching.

"Unfortunately 25 per cent of people who had retired later than planned said it was because they didn’t have enough money to retire comfortably.”

The reality of retirement does tend to sneak up on us and some of us can find talking about it a bit overwhelming - particularly if we feel some things, like our savings, are not on track as you’d imagined they would be.

Using the group aged 45-54 as a proxy for Generation X, ANZ Investments here in New Zealand asked members at what age they expect to stop full-time paid work and retire.

• 35 per cent said they will retire between 65 and 69.
• 16 per cent said they plan to give up full time work in their 70s.
• 2 per cent expect to work into their 80s.
• 3 per cent said they will never retire.

However some said they intend retiring from full-time paid work before 65.

• 9 per cent expect to retire before the age of 60.
• 10 per cent said they expect to retire between the age of 60 and 64.

The survey results also showed a quarter of respondents aged 45 – 54 said they weren’t sure when they would retire because there are too many factors to consider.

But it is important to remember the way we have traditionally thought about retirement is changing as well.

We are living a lot longer and more people are working beyond the official New Zealand retirement age of 65.

For some this is out of necessity but for many working into their late sixties and even seventies, it is a lifestyle choice.

There is no magic number people need to have saved to retire, the amount will be different for each of us.

But it is really crucial for people to check in and get an idea of what that number is for them. That will help them create a plan for what they need to do to reach that goal.

ANZ Investments contacts its KiwiSaver members at 64 and again just before they turn 65 to encourage them to review their plans for retirement.

The researchers also talked to people who have already retired, asking them whether they retired earlier or later than planned, and why. The number one reason for retiring earlier than planned was for health reasons.

Among those who retired later than planned, 52 per cent said they had wanted to keep working part time and 19 per cent said they wanted to keep working full time.

Unfortunately, 25 per cent of people who had retired later than planned said it was because they didn’t have enough money to retire comfortably.

We hope the survey results will help more people to think about what sort of lifestyle they’d like to have after 65 and whether they are on track to achieve it.

Even for the oldest members of Gen X there is a lot they can do before they reach 65.

These tend to be very financially productive years, and even if you are planning to keep working beyond 65, it is a good reminder to stay focussed.

The findings of the survey by Horizon Research are based on an online survey of 1,632 respondents, representing the New Zealand population, aged 18 years and older. There is a margin of error on the overall sample of plus or minus 2.4 per cent.

Fiona Mackenzie, is Managing Director for Funds Management of ANZ NZ.