{"id":48521,"date":"2025-09-02T15:55:12","date_gmt":"2025-09-02T03:55:12","guid":{"rendered":"https:\/\/milfordasset.com\/?p=48521"},"modified":"2025-09-26T16:01:20","modified_gmt":"2025-09-26T04:01:20","slug":"hope-is-not-a-strategy-how-can-nz-prevent-a-retirement-shortfall","status":"publish","type":"post","link":"https:\/\/milfordasset.com\/insights\/hope-is-not-a-strategy-how-can-nz-prevent-a-retirement-shortfall","title":{"rendered":"\u201cHope is not a strategy\u201d: How can NZ prevent a retirement shortfall?"},"content":{"rendered":"

This article was originally published in the NZ Herald<\/a> on 2 Sep 2025.<\/sub><\/p>\n

Why small steps now can add up to a better retirement.<\/strong><\/span><\/p>\n

New Zealand\u2019s population is ageing rapidly \u2013 but saving slowly. Both as households and as a nation, we are not financially prepared for the wave of retirees on our horizon.<\/p>\n

But it\u2019s not too late. We can see the wave coming, and we can make changes now that will set us up for a more comfortable life in the future, says Blair Turnbull, CEO of Milford.<\/p>\n

\u201cThere\u2019s no silver bullet for this problem. If we\u2019re going to succeed, we\u2019ll need strategies at the government, regional, community and individual levels. We know this is coming, and we have time to prepare. The ageing population is inevitable, but the savings crisis doesn\u2019t have to be.\u201d<\/p>\n

As Turnbull previously told the New Zealand Herald<\/a><\/em>, traditional strategies like relying on housing alone are no longer enough.<\/p>\n

Can we shape ourselves into a nation of savers?<\/strong><\/span><\/p>\n

With the cost of living so high, Kiwi households are struggling to meet their day-to-day costs. The idea of saving for retirement on top of that can feel overwhelming.<\/p>\n

\u201cNew Zealand\u2019s savings rate is lower than Australia\u2019s, and much lower than in many Asian countries where people are traditionally very good savers, even on lower incomes,\u201d says Turnbull.<\/p>\n

Reserve Bank data<\/a> shows New Zealand households spent more than they earned in 2023, with a net dis-saving rate of 3% of GDP. \u201cKiwis are saving roughly half of what we need to have a basic rewarding retirement. Too many people are arriving at retirement without enough and lacking a diversified portfolio that includes both a home and savings.\u201d<\/p>\n

Turnbull would like to see New Zealand become a nation of savers, with support from the Government, KiwiSaver, and the financial markets. \u201cAll boats rise with a stronger savings culture. It benefits our whole economy, individuals, businesses and communities.\u201d<\/p>\n

Learning to discuss money without shame or judgment<\/strong><\/span><\/p>\n

One of the factors that\u2019s holding Kiwi households back is our cultural reluctance to talk about money. Without talking honestly about money, it\u2019s hard to stick to shared goals and learn more about optimising our savings.<\/p>\n

It\u2019s an awkward topic for the average New Zealander: a 2025 FMA report found that 42% of Kiwis are \u201cuncomfortable discussing their financial situation with others\u201d, in addition to finding that 61% of respondents described themselves as \u201cfinancially uncomfortable\u201d.<\/p>\n

\u201cThis is a cultural challenge,\u201d says Turnbull. \u201cWhen we don\u2019t talk about money, we don\u2019t learn more about it, and we don\u2019t work through our problems together. I think we\u2019re worried about being judged or made to feel like we\u2019ve failed. Nobody is judging. You are where you are, and you can\u2019t change the past. You shouldn\u2019t beat yourself up. But you can and should make a plan for a better future.\u201d<\/p>\n

Learning more about money management is one way to help battle our culturally low savings rate. Savings and investments can be optimised, no matter how small \u2013 for example by ensuring KiwiSaver balances are in the right fund for you. Over time, good habits and discipline can lead to a larger fund and a better lifestyle in retirement.<\/p>\n

\u201cIt\u2019s like gardening,\u201d Turnbull says. \u201cYou plant tiny seeds, and if you take care of them, you can get enormous enjoyment out of seeing them grow over time, which is both satisfying and rewarding.\u201d<\/p>\n

We need more ways to invest in Aotearoa and its infrastructure<\/strong><\/span><\/p>\n

Turnbull would also like to see more potential places for Kiwi savers to plant those financial seeds. KiwiSaver is very good and share trading platforms have democratised stock markets, but New Zealand\u2019s financial markets still need to provide more options for investors.<\/p>\n

\u201cWe know as a country that we need better infrastructure, and I would like to see more assets for KiwiSaver to invest in, particularly listed infrastructure. Expanded private markets for debt and\/or equity would also be positive, and it would be great to see more businesses list on the NZX.\u201d<\/p>\n

For individuals, a portfolio with a sum in KiwiSaver or other similar assets means you\u2019ll have access to cash when you need it in retirement. It\u2019s much more accessible than the equity in your home. At a national level, more local investment options would strengthen our local businesses and help fund infrastructure construction and maintenance.<\/p>\n

At the moment, Milford has around 80% of its investments offshore and would welcome more local opportunities.<\/p>\n

At the individual level, small changes can compound into great results<\/strong><\/span><\/p>\n

For Kiwi households, it\u2019s a challenge to set aside any amount for retirement. But even small changes now could add up to a significantly more comfortable retirement lifestyle in the years ahead, says Turnbull. It all starts by understanding where you are now, setting a goal, and getting advice to create a roadmap towards a better future.<\/p>\n

\u201cThat\u2019s the burden of savings: there are always other temptations that are more gratifying in the short term, but it is increasingly important to balance that with your longer term savings and wealth goals. Talk about your financial situation, get support and advice, and put a pragmatic plan in place to address it. But don\u2019t just hope it sorts itself out by retirement,\u201d he adds. \u201cHope is not a strategy.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

This article was originally published in the NZ Herald on 2 Sep 2025. Why small steps now can add up<\/p>\n","protected":false},"author":52,"featured_media":48522,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"ep_exclude_from_search":false,"footnotes":""},"categories":[850,848],"tags":[],"media_type":[701],"fund_category":[],"class_list":["post-48521","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-retire-well","category-investing","media_type-read"],"acf":[],"yoast_head":"\n\u201cHope is not a strategy\u201d: How can NZ prevent a retirement shortfall? - Milford<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.nzherald.co.nz\/sponsored-stories\/hope-is-not-a-strategy-how-can-nz-prevent-a-retirement-shortfall\/WBCEH5PGFJBCPA6PLWW5JAE5MI\/\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"MAM\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"5 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.nzherald.co.nz\/sponsored-stories\/hope-is-not-a-strategy-how-can-nz-prevent-a-retirement-shortfall\/WBCEH5PGFJBCPA6PLWW5JAE5MI\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/milfordasset.com\/insights\/hope-is-not-a-strategy-how-can-nz-prevent-a-retirement-shortfall\"},\"author\":{\"name\":\"MAM\",\"@id\":\"https:\/\/milfordasset.com\/#\/schema\/person\/f1d0ca8b4295df91c529dc366431f417\"},\"headline\":\"\u201cHope is not a strategy\u201d: How can NZ prevent a retirement shortfall?\",\"datePublished\":\"2025-09-02T03:55:12+00:00\",\"dateModified\":\"2025-09-26T04:01:20+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/milfordasset.com\/insights\/hope-is-not-a-strategy-how-can-nz-prevent-a-retirement-shortfall\"},\"wordCount\":909,\"publisher\":{\"@id\":\"https:\/\/milfordasset.com\/#organization\"},\"image\":{\"@id\":\"https:\/\/www.nzherald.co.nz\/sponsored-stories\/hope-is-not-a-strategy-how-can-nz-prevent-a-retirement-shortfall\/WBCEH5PGFJBCPA6PLWW5JAE5MI\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/milfordasset.com\/wp-content\/uploads\/2025\/09\/TQJ7US7NR5E4ZJDN2J2FB5DKEY.avif\",\"articleSection\":[\"Retire Well\",\"Investing\"],\"inLanguage\":\"en-NZ\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/milfordasset.com\/insights\/hope-is-not-a-strategy-how-can-nz-prevent-a-retirement-shortfall\",\"url\":\"https:\/\/www.nzherald.co.nz\/sponsored-stories\/hope-is-not-a-strategy-how-can-nz-prevent-a-retirement-shortfall\/WBCEH5PGFJBCPA6PLWW5JAE5MI\/\",\"name\":\"\u201cHope is not a strategy\u201d: How can NZ prevent a retirement shortfall? 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