Threat of superannuation change rattles retirees

Retirees are worried government changes to Super are the tip of the iceberg. Picture / File

The spectre of changes to the Super scheme has sent retirees flocking to financial advisers.

Prime Minister Bill English is planning to raise the retirement age from 65 to 67, phasing in the changes from July 2037.

Lifetime Retirement Income is currently hosting a series of free seminars throughout New Zealand, aimed at helping retirees manage their money better.

The group held a similar series last year, where about 2000 people showed up, chief executive Ralph Stewart said.

But this year had seen a jump in attendance of about 40 per cent.

He put the change down to people feeling uncertain about NZ Super.

"This time around we're seeing more people who are worried about outliving their savings, the future of NZ Super, and the potential of bringing in means testing.

"I think the announcement about changes to the Super age has left people with a lot of questions.

"The volume of people coming through suggests people are concerned, and that it's pretty significant to the retired community."

Many retirees weren't sure how to manage their money, Stewart said, so just tried to cut back on spending.

"But their retirement could be substantially better if they had a bit of a plan, and were aware of other opportunities."

Money Max owner Liz Koh said retirees were taking far more interest in the subject than before, showing up in their droves at the seminars and her business.

The level of interest showed just how concerned older people were, she said.

"The current Super changes are so distant that it's created a bit of cynicism there.

"Anything could happen between now and 20 years' time, there could be two or three different Governments in that time, so it's created some distrust.

"People are asking about means testing, about surcharges, and whether they're looking likely as well now.

"Because they're saying that if the Government is now looking at the pension, what else is coming?"

Koh warned that retirees needed to learn smart investment strategies to make their money last a possible 30 years.

"The days of putting your money in the bank are long gone, you have to diversify into other asset classes.

"With interest rates as low as they are, at a bank you'll be barely treading water.

"Shares go up and down in value, but you basically have to do that to get a good return.

"While shares are volatile, over the long term, they give consistently the best return."

People interested in attending the remaining seminars can find out more here.