Who wants to retire at 65?

Growing numbers of people are reaching retirement and realising there’s one thing they can’t live without — their job — according to BNZ Financial Futures research.

Forty-six per cent of respondents wanted to keep working past 65, two-thirds of those over the age of 65 wanting to keep working because of the value and satisfaction they gained.

Other important factors were the ability to use skills and talents (68 per cent) and social contact (57 per cent).

“Many people are fitter and healthier in their 60s and 70s than previous generations, and more are keen to keep working for longer,” BNZ’s director of retail and marketing Paul Carter said.

“For many New Zealanders, it’s a question of balance as they get older. Only 18 per cent plan to work full-time, 31 per cent preferring a part-time job, giving them time to enjoy other activities, including travel and spending time with their children and grandchildren.

“Working longer opens up all kinds of opportunities for people, including changing the way they view their finances,” he added, but the reality for 31 per cent of respondents was that they would need the money they would earn past 65 to pay their bills.

Mr Carter believed that the gap between those who chose to work in retirement and those who had to was too high, however, and there was a real opportunity for people to narrow that gap by more proactively planning their finances.

For 76-year-old BNZ Agribusiness banker Paul Buist, who had been with the bank for 26 years, it was about the joy of going to work and making a valuable contribution to his customers’ businesses and his employer. His top tip was to set financial goals and to follow a monthly budget.

“That’s the voice of experience talking,” Mr Carter said.

“I recommend people start with doing what they can to get on top of their debts, give their mortgage repayments the onceover, and check to ensure that their KiwiSaver is working hard for them,” Mr Carter says.

“Having your finances in a good state so you can make a choice to work in later life means not being complacent now.”

The research found that 72 per cent of people were confident that they would pay off their mortgage before they retired or semiretire. Others planned to pay off their loans after 65, by selling up and buying a cheaper house, from savings or dividends from investments.

“We are still benefiting from some of the lowest interest rates in a generation, so now is the best time to look at your repayments to see how you can speed up saying goodbye to your mortgage,” Mr Carter said.

“Even simple things like changing from monthly to fortnightly payments will cut the length of your home loan, without feeling the pinch.” A 30-year home loan of $560,000 at 4.65 per cent could be reduced by more than four years and $75,700 by lifting fortnightly repayments by $100.

Meanwhile 57 per cent expected to depend on superannuation investments, either company or KiwiSaver, to fund the life they wanted in retirement.

“KiwiSaver is such an important component of people’s plans for funding retirement, so make sure you not only enrol in KiwiSaver, but make an active fund choice and take an interest in the fund where you are invested,” Mr Carter said.

“All these tactics will help in achieving the retirement you want and deserve.”