Kiwis should be able to choose their retirement age
July 28 3:08 PM
AUTHOR:
I have been very happy with the response UnitedFuture’s radical superannuation policy that I announced last week. The word among the Parliamentary Press Gallery journalists was that they were all doing calculations of the ‘what would it mean for me’ variety!
Our policy is to give New Zealanders a choice that they do not currently have, to retire with superannuation anywhere from 60 to 70, rather than the current flat non-option of 65.
And the beauty of our policy is that it will cost government no more than the current scheme does.
People would be able take up superannuation at reduced rates from 64 down to 60, or enhanced rates from 66 to 70, or if they prefer, just as it is now at 65.
To give this choice, KiwiSaver – which has been adopted at a phenomenal rate by 1.75 million New Zealanders already – would be made compulsory.
New Zealanders already recognise that KiwiSaver is the anchor of their retirement savings, and will only grow in significance.
Our policy is effectively a circuit-breaker on the whole superannuation sustainability argument and the growing debate on whether it needs to be pushed out from 65 to 67.
That simply becomes redundant with a compulsory KiwiSaver scheme, and a full choice for New Zealanders aged from 60 to 70 on when they retire and take their super.
Superannuation is also fundamentally a hip-pocket issue for people, and our policy recognises that.
On current superannuation levels, a couple who get $522 a week when they turn 65 could choose to wait to 70 and get $840 a week. Equally if they instead chose to wait until, say, 67 and get $630 a week.
“If they wish to retire earlier than 65, then they would receive a slightly reduced amount at 64, and lesser again at 63 and 62, down to 60.
Similarly, a single person could still collect the current $339 per week, or on today’s figures get $410 if they waited to 67 or $546 at 70.
Kiwis would then be able to manage their retirement age and lifestyle and, as I say, it is cost neutral with the current scheme.
People can work out what works best for them based on their lifestyle and aspirations.