New Zealand’s population is ageing rapidly – but saving slowly. Both as households and as a nation, we are not financially prepared for the wave of retirees on our horizon.

But it’s 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.

“There’s no silver bullet for this problem. If we’re going to succeed, we’ll 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’thave to be.”

As Turnbull previously told the New Zealand Herald, traditional strategies like relying on housing alone are no longer enough.

Can we shape ourselves into a nation of savers?

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.

“New Zealand’s savings rate is lower than Australia’s, and much lower than in many Asian countries where people are traditionally very good savers even on lower incomes,” says Turnbull.

Reserve Bank data shows New Zealand households spent more than they earned in 2023, with a net dis-saving rate of 3% of GDP. “Kiwis are saving roughly half of what we need to have a basic rewarding retirement. Too many people are arriving at retirement withoutenough, and lackinga diversified portfolio that includes both a home and savings.”

Turnbull would like to see New Zealand become a nation of savers, with support from the Government, KiwiSaver, and the financial markets. “All boats rise with a stronger savings culture. It benefits our whole economy, individuals, businesses and communities.”

Learning to discuss money without shame or judgment

One of the factors that’s holding Kiwi households back is our cultural reluctance to talk about money. Without talking honestly about money, it’s hard to stick to shared goals and learn more about optimising our savings.

It’s an awkward topic for the average New Zealander: a 2025 FMA report found that 42% of Kiwis are “uncomfortable discussing their financial situation with others”, in addition to finding that 61% of respondents described themselves as “financially uncomfortable”.

“This is a cultural challenge,” says Turnbull. “When we don’t talk about money, we don’t learn more about it, and we don’t work through our problems together. I think we’re worried about being judged or made to feel like we’ve failed. Nobody is judging. You are where you are, and you can’t change the past. You shouldn’t beat yourself up. But you can, and shouldmake a plan for a better future.”

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 – 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.

“It’s like gardening,” Turnbull says. “You 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.”

We need more ways to invest in Aotearoa and its infrastructure

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 stockmarkets, but New Zealand’s financial markets still need to provide more options for investors.

“We 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.”

For individuals, a portfolio with a sum in KiwiSaver or other similar assets means you’ll have access to cash when you need it in retirement. It’s 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.

At the moment Milford has around 80% of its investments offshore and would welcome more local opportunities.

At the individual level, small changes can compound into great results

For Kiwi households, it’s 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 towardsa better future.

“That’s 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’t just hope it sorts itself out by retirement,” he adds. “Hope is not a strategy.”

For more information on the Milford KiwiSaver Plan visit milfordasset.com.

Disclaimer: This article is intended to provide you with general information only. It does not take into account your objectives, financial situation or needs. Milford Funds Limited is the issuer of the Milford KiwiSaver Plan. Please read the Milford KiwiSaver Plan Product Disclosure Statement at milfordasset.com. Before investing you may wish to seek financial advice. For more information about Milford’s financial advice services visit milfordasset.com/getting-advice. Financial Advice Disclosure Statements for all Milford Financial Advisers are available on request free of charge. Past performance is not a reliable indicator of future performance.