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Playing the retirement guesstimation game

Written: 11 August 2022

Author: Kirsty O’Hara

8 min read

The following article is intended as a demo of the tools and calculators available over on Sorted. It is shared for the purpose of guidance only. Flint is not affiliated with Sorted in any way. We encourage you to visit to complete the questions for yourself, to inform and guide your own financial choices and goals. Please remember that planning calculators are not crystal balls and are for the purpose of creating indicative forecasts so you can set financial goals accordingly.

What does retirement look like for you? Do you wonder “Will I have saved ‘enough’?” And how much is ‘enough’?

Today at Flint we’re all about retirement guesstimation. Call it the ‘Guesstimation Game’ if you like. To play the ‘Guesstimation Game’, we are making use of Sorted’s Retirement Planning tools and KiwiSaver calculator. If you haven’t encountered Sorted before, we recently shared an overview of Sorted in our article ‘Let’s demystify money, with Sorted’ - which you can view here.

The main reason Sorted’s digital platform exists is to help steer Kiwis in the right direction financially. By exploring the concept of your retirement lifestyle, you can plan accordingly and start incrementally building future wealth.

Why Bother?

Statistics New Zealand highlights that: “On average, 80% of 65-year-old men can now expect to live until they're 90, and 65-year-old women until they're 94”. Which is a hugely motivating savings prompt, especially if you don’t intend to work into your eighties and nineties!

Getting clear about the fact you may need to support yourself for 25-30 years from when you stop working means starting early may be key to a comfortable retirement. Sorted comment:

“Even if it seems a long way off, it pays to start planning for retirement as early as possible. How much you need to save will depend on your own circumstances, but the sooner you start, the better the position you’ll be in when you eventually stop working.”

Your Future Lifestyle (Optional Guessing)

Sorted keep it simple, by identifying six key lifestyle options you may choose in retirement:

  1. Main Centre, No Frills Lifestyle – $865 weekly (couple); or $726 weekly (single)
  2. Main Centre, Choices Lifestyle – $1,470 weekly (couple); or $1,019 weekly (single)
  3. Main Centre, Your Goal Lifestyle – TBC – you enter weekly budget
  4. Regions, No Frills Lifestyle – $747 weekly (couple); or $605 weekly (single)
  5. Regions, Choices Lifestyle – $1176 weekly (couple); or $1,116 weekly (single)
  6. Regions, Your Goal Lifestyle – TBC – you enter weekly budget

Key to Note: you will want to revisit Sorted annually, to see how these numbers are tracking alongside inflation. This is not a done-and-dusted kind of exercise. Also, because the cost of living is so similar when comparing a single retired person with a couple, we have opted to show avatars that have a partner.

HELPFUL TIP: If you find yourself thinking, ‘gosh, I really don’t know’ exactly where I’ll live - then why not select ‘Choices’ and ‘Main Centres’*. Forecasting towards metro options, can be a helpful starting point to observe what it takes savings-wise to consider these more expensive retirement lifestyles.

*Just to be clear we are not advocating that everyone should aim for a ‘Choices’ budget in the main centres. We are however advocating that continuing through the retirement calculator to the sliding toggle section means you can at least consider all your options. Get guesstimating friends!

Avatar Demo’s

If you’re curious to learn more, let’s first look at the backbone of retirement planning by considering some fictional avatars:

  • Avatar 1 : Emerging Investor : Sam + Partner : Age 25 (Savers)
  • Avatar 2 : Intermediate Investor : Chris + Partner : Age 35 (Splurgers)
  • Avatar 3 : Mature Investor : Kylie + Partner: Age 45 (Late Savers)

Please note: the following examples use the median income for each age group, as per the 2021 Statistics New Zealand data. We have also assumed they are all working in full time employment with salaries. If you are self employed, please be sure to complete the Retirement Calculator to get a more accurate prediction relevant to your circumstances. For simplicity - none of our avatars use KiwiSaver to purchase their first home.                                       

Avatar 1 : Emerging Investors

To complete retirement calculations for our avatars, we first need to understand how their KiwiSaver trajectory is looking.

KiwiSaver works in a similar fashion to managed funds - with the main difference being that you can’t withdraw funds until age 65 years (except for when purchasing your first home or if you are in financial hardship).

To do this we make use of the KiwiSaver Calculator tool. This tool helps you to forecast your potential KiwiSaver balance at retirement age.

25 year old Sam : earns $40,380 pa. She/he/they have a current KiwiSaver balance of $2,000. If Sam invests in a Growth KiwiSaver fund and:

a) matches their employer’s contribution of 3%. By age 65 the KiwiSaver Calculator estimates that Sam will have approximately $223,531 (accounting for inflation):

b) IF Sam chose to increase personal contributions to 4% then the approximate balance at age 65 years increases by $30k to approximately $258,636 (accounting for inflation).

c) IF Sam chose to increase personal contributions to 8% then the approximate balance at age 65 years increases by more than 50% to approximately $399,060 (accounting for inflation).

You can see that if Sam gets ahead joining KiwiSaver, and voluntarily increases contributions as well as allocating any surplus cash into investments (such as managed funds) then Sam has the opportunity to truly maximise the compounding benefits best seen when starting young. It’s up to you if you prefer to increase your KiwiSaver contribution, or invest surplus income directly into managed funds or other investments (which give you greater flexibility around withdrawal timeframes). If Sam applies the same thinking to all savings and investments, then Sam could have a comfortable nest egg built up by retirement.

Assuming Sam and partner both contribute 4% to KiwiSaver ($258,000 each), and have built up $300,000 of additional savings/investments, and no inheritance - then Sam + Partner’s retirement calculator could potentially look something like this collectively. If you compare this calculator with Avatar’s 2 and 3 you will truly appreciate the compounding benefits of starting young and increasing contributions. It’s also important to highlight that Sam and partner have built up savings and investments as well as a healthy KiwiSaver balances – which gives them more options in retirement:

Note: The above calculation excludes proceeds from the sale of downsizing a home, because there is a potential economic shift in home ownership statistics. Therefore any emerging investors considering this example could either redo the calculations to include proceeds from downsizing as additional retirement income; or if renting would need to deduct the cost of rent off the $1,672 weekly figure quoted.

Avatar 2 : Intermediate Investors

35 year old Chris earns $52,490 pa. He/she/they have a current KiwiSaver balance of $2,000. If Chris invests in a Growth KiwiSaver fund and:

a) matches their employer’s contribution of 3%. By age 65 the KiwiSaver Calculator estimates that Chris will have approximately $161,030 (accounting for inflation):


b) IF Chris chose to increase personal contributions to 4% then then approximate balance at age 65 years increases by $25k to approximately $186,810 (accounting for inflation).

c) IF Chris chose to increase personal contributions to 8% the approximate balance at age 65 years increases significantly to $289,926 (accounting for inflation).

You can see that by being slower to get going, Chris is significantly disadvantaged compared to Sam. And if Chris is a female, and about to have any time out of the workforce, then that could mean a period with lower contributions – which could lead to a larger shortfall.

Assuming Chris and partner both contribute 3% to KiwiSaver ($161,000 each), and have built up $50,000 of additional savings/investments, and inherit nothing - then Chris + Partner’s retirement calculator could potentially look something like this collectively. You’ll see that as a couple they have some decisions to make - as they are falling short based on these calculations. Without increasing their savings and investments ahead of retirement, they may need to consider a more regional or no frills retirement lifestyle and tweak the calculator accordingly to get in the green:

A result like this could be motivating to:

  1. a) look for areas to increase savings prior to retirement, or
  2. b) reality check your future lifestyle with your financial capability. Chris and partner may need to reduce retirement expenses ~ such as choosing a ‘No Frills’ lifestyle in the regions.

Avatar 3 : Mature Investors

45 year old Kylie is returning to work after raising children. KiwiSaver wasn’t a thing before she had kids, so the whole idea of compound benefits is new to Kylie. Kylie earns $56,470, and has a current KiwiSaver balance of $2,000. Because her timeline is getting shorter, and fictional Kylie has a lower appetite for risk compared with Sam and Chris she selects a Balanced KiwiSaver offering. If Kylie invests in a Balanced KiwiSaver fund and:

a) matches her employer’s contribution of 3%. By age 65 the KiwiSaver Calculator estimates that Kylie will have approximately $86,449 (accounting for inflation):

b) IF Kylie chose to increase personal contributions to 4% then then approximate balance at age 65 years increases by $15k to approximately $101,061 (accounting for inflation).

c) IF Kylie chose to increase personal contributions to 8% the the approximate balance at age 65 years increases significantly to $159,509 (accounting for inflation).

As you can see, Kylie misses out on the compounding benefits that Sam experiences over time; with Sam’s retirement balance more than double Kylie’s. This is a classic example of what New Zealand’s KiwiSaver scheme can teach all of us about the value of making regular contributions to investments.

With KiwiSaver launching in 2007, many 45-year-olds were slow to observe and understand the compounding benefits of the scheme. It also entered the New Zealand financial literacy realm around the same time that many people in their late forties were about to juggle family life. For this reason Avatar 3’s retirement savings shows an example where one partner has a higher KiwiSaver balance.

Assuming Kylie and partner both contribute to KiwiSaver ($159,509 for Kylie (at 8% contributions to play catch up; and $300,000 for her partner who may have steadily contributed over a longer period), and have built up $350,000 of additional savings/investments, and inherit $100,000 - then Kylie + Partner’s retirement calculator could potentially look something like this collectively. You’ll see that based on these numbers, and investment time periods, that even with $100,000 of inheritance in the mix they can only just afford to consider a retirement in a Metro location with Choices. If their other savings or inheritance were lower, they may need to either consider a more regional retirement OR a metro retirement but with a no frills lifestyle:

You will see there are factor such as inheritance which will be different and unpredictable. For this reason we have entered inheritance as $100,000 – but again iterate that you would be best to complete the tools yourself, using accurate forecasting unique to your own personal circumstances.

Note these avatar examples are purely for illustrative purposes. We do encourage you to give the calculators a whirl to customise the outputs to your own unique age and stage and financial preferences.

If you are nearing retirement, and feel like you are sorted on the savings front, but curious about the best ways to make your money last in retirement then Sorted have some great articles on this topic. You can check them out here.

Can teens use these tools?

According to Statistics New Zealand 2019 data, teenagers aged 15 to 19 were earning a median annual $8,820 from wages and salaries. Given this is likely to be mostly disposable income, there is great opportunity to establish regular investment habits - before the adult pressures of putting food on the table kicks in.

Hearing that some colleges have introduced teenagers to Sorted tools in accounting classes, indicates that there is definitely scope to use the KiwiSaver calculator and other Sorted tools with the teenagers in your life. Building good financial habits from a young age is a valuable asset.

Retirement Planning Out-takes

The main thing that these graphs teach us is that retirement planning is unique to each of us. It’s unique to our money habits, the regular contributions and investments / savings we make, and it is unique to when we start and what curve balls life throws us along the way. Because of this it is very difficult to execute the retirement tools on your behalf.

We hope you find the tools are easy to use, filled with hope, and equip you with the insights required to set some great savings and investment goals in motion.

Take Action

For some of you these retirement planning exercises might be a feel good, nodding, affirmative process. For many of us it will be a reality shock and a chance to write down actionable steps we need to put in place.

Examples of action steps might be (but are not limited to):

Setting up a regular automatic transfer to your preferred investment provider. This might be an investing platform, a fund manager, or into an ETF or other investment. Investing outside of KiwiSaver means you can access these funds more easily prior to retirement if required.

Increasing your Kiwisaver contribution from 3% to a higher amount? This can appeal to people who find it too tempting to dip into savings and investments early. By increasing contributions to KiwiSaver you make the decision to lock those funds away so you can’t touch them for an emergency holiday, spa pool or renovation.

Set up savings autopayments to ensure surplus cash doesn’t sit in your everyday bank account. Some people even like to have this savings account with a different bank, so it is out of sight and temptation to spend it is reduced.

Consider doing a budget refresh to identify areas you can trim your spending and increase allocation of current income into savings and investments. The sorted budgeting tool can help with this. You can find it here.

Find an accountability partner. It might be your partner, a sibling, or a friend. Make your retirement savings goals a shared conversation, so you can help each other to stay on track.

If you have identified areas where you can improve your everyday habits, you need to make it a priority to take action.

Why retirement planning matters

Sorted is the first to point out that NZ Super only covers the basics for two people living a frugal lifestyle in a provincial region. Therefore, in most cases, there is bound to be a gap to fill if we wish to retire in a metro area or with a ‘choices’ lifestyle. For many people this ‘gap’ between NZ Super and your actual weekly retirement budget will need to be covered by KiwiSaver and other investments.

According to Sorted “close to 40% of New Zealanders over the age of 65 rely on NZ Super alone. However, most retired New Zealanders also live off their own savings in addition to NZ Super”.

Sorted highlights that “Most likely, there will be a gap between the income NZ Super provides, and the income you want in retirement. So you’ll need to have other sources when planning for retirement needs”.

Sorted also comments that we are seeing shifts in housing ownership; and they point out that “What retirees are living on today may look different in the future, depending on whether you are renting, paying a mortgage or own your home.” It’s important to acknowledge this when you are planning your retirement calculations. If you don’t intend to be rent free or mortgage free prior to retiring, then be sure to add on the cost of your rent or mortgage repayments to your weekly budget – as these are not included in the weekly ‘No Frills’ and ‘Choices’ weekly budgets.

Above all else, regardless of your age and stage, a worthy benefit of using retirement planning tools is it takes your worries out of your head and puts them into a more tangible format. It’s easy to lose sleep, or experience some anxiety, when there is a lack of clarity. We hope that if nothing else today’s article gives you the courage and curiosity to move beyond ‘just wondering’ what retirement might be like. With 5-10 minutes of putting fingers to keyboard you can actually see if you are on track towards your preferred retirement lifestyle.

In Conclusion

We live in a world that is engineered to constantly prompt us to spend money, making temptation high and willpower stretched. This is where the Sorted retirement calculators are fantastic - they really do highlight that you always have a choice, and the choices you make today will impact the choices and freedom that you have in retirement.

If you don’t know what your retirement savings goals are, then how do you aim to achieve that goal? Without a savings and investment map towards a comfortable retirement, you are likely relying on luck and lotto tickets to get there safely. You may also experience an occasional sense of unease, due to a lack of clarity, if you are playing the ‘wing it’ game.

Sorted sum it up well by commenting:

“One thing is for sure – using the retirement planner sooner rather than later will give us a sense of what savings are required to retire the way we want.”

We couldn’t agree more. So head on over and give it a whirl by clicking here.

Happy guesstimating!




All content shared is of a general nature, current to the time it was penned, and is not financial advice. Before making any investment decisions, please be sure you have completed full due diligence. This should include reading the product disclosure statement (PDS), considering fees and taxation, identifying your time horizons, and understanding the performance history and reputation of the investments you are considering.

Please note: When investing you are not guaranteed to make money (and on occasion you may lose some or all of the money you began with). Seek independent advice to establish if an investment is suitable for your financial situation and long-term wealth generation goals.