12 July 2022

DIY The Best Approach for KiwiSavers Approaching Retirement

A just-released in-depth analysis of most KiwiSaver accounts has confirmed personalised financial advice remains out of reach for the majority of members at, or close to, retirement age.


A sub-committee of the NZ Society of Actuaries (NZSA) had found that the “modest” account balances of members aged 45 or older will make it too expensive to seek personalised financial advice when calculating an income drawdown in retirement.


The NZSA paper concludes “Most retirees will rely on generalised guidance, which should be simple, readily available and consistent across multiple sources.”


Ralph Stewart of the Lifetime Retirement Income says “assisting KiwiSavers to make the transition from saving for retirement to spending in retirement is fundamental to the success of KiwiSaver. The NZSA’s work is nothing new and a practical outtake of the challenges KiwiSaver faces as more and more members move into retirement.”


Converting savings into a retirement income to last a lifetime need not be complicated or difficult.


There are two fundamental elements;

  • Everyone’s retirement is unique, not one size fits all, and;
  • Calculating a retirement income is not a set and forget exercise, simple annual reviews ensure there are no surprises as people grow older.
Ralph Stewart - Managing Director & Founder of Lifetime Retirement Income

Ralph Stewart - Managing Director & Founder of Lifetime Retirement Income

In the world we now live in where information and calculators are readily available online, this process can and should be cost effective and simple for individuals to use.


For example, Lifetime Retirement Income provide a free online calculator (Click to View) which allows individuals to consider their retirement income options without detailed financial advice. The Lifetime Retirement Income Calculator does the math by considering;

  • The impact that gender has on aging;
  • Individual expected mortality;
  • Personalised Prescribed Investor Rate for tax, and;
  • Expected investment returns,


Individuals can then consider different mortalities and spending levels to tailor the results to their individual retirement lifestyles. The Lifetime Calculator is constantly updated with the latest investment and mortality projections to allow retirees to check in every year or so to ensure their income remains on track to last their lifetime.

Project your fortnightly, tax-paid income.

Lifetime Income Projection

The following is an example of a couple aged in their 60’s where the Lifetime Calculator automatically recognises the youngest age to ensure the income estimate is calibrated to the partner who is most likely to survive the longest.


Rob and Janice Smith are aged 67 and 65 respectively, their savings balance is $300k, they both have the same Prescribed Investor Rate of 17.5% and have chosen an average life expectancy and an annual inflation adjustment of 2%.


The free online Lifetime Calculator projects a tax-paid income of $461 per fortnight, growing to $685 by age 85 and $819 by age 94. The income will cease when Janice reaches age 95.


Stewart says, “the NZSA’s work is helpful in continuing to raise the level of awareness for the importance of providing simple and effective tools to support KiwiSavers make the transition from saving for retirement to living in retirement. Current KiwiSavers and retirees need no wait however the tools exist today.

Calculator projection (example)

Calculator projection (example)

Photo of Ralph Stewart
Written by:

Ralph Stewart

Ralph Stewart is the Founder and Managing Director of the Lifetime Asset Management, managers of the Lifetime Retirement Income Fund.

Invest with Lifetime for a retirement income managed for living.