NZ Super - Sustainable?

[Tan]

Perhaps the conversation should be more along the lines of... should we move to Australia now or later... because they've provided for this and we haven't.

Lost me - how have Aus provided for what?

With their equivalent of kiwisaver - much higher % of a wage and compulsary.

[Tan]

I like your reasoning flyernzl, nothing is as simple as it seems.

[Perry]

The problem is not complex ..why make it so? People need to make provision for their retirement.. They wont do so while nat super is there ... The belief that the State will provide died a while ago but we dont seem to have learned it yet..

Sacrifice some standard of living now so you can eat when your old!

It is that simple..

It is? Isn't there's a mentality change needed? The (any!)
government is very unlikely to forego the tax revenue
no longer needed to pay for the current retirees. There-
fore, no one is likely to say: fair enough - I'll change my
attitude, then, while still being taxed as if nothing had
changed, at all.

[Dean@Massiveaction]

Is super sustainable = no.
It was designed on Germany to provide 2 years of support before death. It will collapse globally, it has to. People need to sort their own financial futures out and break their addiction to the government being their parents

[One]

Problem is, many people only have about 40-45 years post-education when their health is good enough to let them work. Then they have 20-30 years in retirement. That's a lot of food, rent and power to have to save for.

[WGN ex-property manager]

Is super sustainable = no.
It was designed on Germany to provide 2 years of support before death. It will collapse globally, it has to. People need to sort their own financial futures out and break their addiction to the government being their parents

Totally agree, but its going to be very very messy when it happens, especially in "soft western democracies" who assume the nanny state safety net is a god given right.

Anyone here on PT is at least thinking about investing for their future... but the masses are not. I fully expect a fair degree of social disorder when the government of the day finally has to pull the plug.

[Dean@Massiveaction]

One, it's not about saving though, unless you adopt the OZ model of compulsory saving for life, which I think is a great idea, but educating people on the need to invest etc.
When I go to Asia, where the government gives you zip, people are planning for their retirement from their first after school job.

This is a long term problem. IF the next generation can build some wealth and leave a legacy and educate that generation on how to protect and enhance that legacy we start to solve the problem.

I don't see any other alternatives??

Agree Robin, it will chaos but it will happen. Governments will go bankrupt if they don't turn the tap off.

If we survive the baby boomers dying off it might come right but that's a long way away.

[WGN ex-property manager]

When you think too deeply about it you end up if really weird moral spaces...

Like improved medical care (eg gene therapy or cloned organs) being seen as a BAD THING?

My Dad has a state funded pension from the UK that's index linked to inflation!?!?! Given that he's in his mid 60's and still racing yatchts, and his dad 92 and still flying round the world he stand a good chance of collecting for decades yet.

I'm very happy for him..... but the numbers must look terrible viewed from the UK treasury. Maybe if they hadn't been so anti smoking all these years they might have a smaller problem

[flyernzl]

Totally agree, but its going to be very very messy when it happens, especially in "soft western democracies" who assume the nanny state safety net is a god given right.

Singapore has state-funded retirement with a pension at age 60. I would not classify them as a 'soft western democracy'.

Two hundred years ago, your family was your social security. You supported the young the elderly and the sick within your extended family, and when your turn came you were supported. The average person paid little or no direct tax to the government.

Then Big Government came along and said "Forget your family. Pay us a substantial proportion of your income every year and we will support you when you need it".

Now when that looks like falling apart, what they cannot say is "Pay us a substantial proportion of your income, and be dependent on your family when you are old or ill".

One part of the implied contract necessitates the other.

Unemployment for WINZ public servants anyone?

[Perry]

This is a long term problem. IF the next generation can build some wealth and leave a legacy and educate that generation on how to protect and enhance that legacy we start to solve the problem.

I don't see any other alternatives.

Famine, pestilence, war, genocide, global hysteria
about / over . . . .

Educate the next generation? You jest!? First,
you'll need to shut down the lies, PR and spin
doctors in the PR companies and advertising
agencies. And you may need to do that before
the next wave hits . . .

. . . being neuro marketing. Further . . .

How do you suggest the next generation builds
some wealth (as you put it)?
.

[Dean@Massiveaction]

@Perry. I didn't say it was easy. I don't know what will happen. All I know is that every Asian nation I have visited this year that doesn't have any super or other schemes has a population that is building its own wealth through multiple businesses, property investment, family trust s pooling funds and income to buy income producing assets etc. etc.

I personally like the OZ solution. Force everybody to save 7 to 9% of their income form day 1 and allow them to invest it and educate them on how to make that work

[drelly]

The problem is really bad here but just not recognised for what it is. Most will retire with very little in the way of assets other than their own home.

[whitt]

I personally like the OZ solution. Force everybody to save 7 to 9% of their income form day 1 and allow them to invest it and educate them on how to make that work

NZ's probable take on that:

Everyone is forced to save into a compulsory fund of 2 to 3% earnt income from day 1.
On reaching retirement those with the saved fund can use it for retirement and those who did not work or were low income would be topped up by the government.

The reality is pension age will creep older so if you are substantially younger than 65 now start planning.

[Davo36]

Well they've been saying for years that the various social systems around the world will collapse. And it seems they must. More and more oldies and unemployed relying on fewer and fewer workers who are getting squeezed for all their worth.

But then countries can just go on borrowing forever it would seem. And then when things get quite bad, start printing money. Nothing ever falls over...

[Tan]

Problem is, many people only have about 40-45 years post-education when their health is good enough to let them work. Then they have 20-30 years in retirement.

Given that he's in his mid 60's and still racing yatchts, and his dad 92 and still flying round the world

I don't believe most people are too old to work at 65. I am shooting myself in the foot here because I don't want to have to work after that - I also don't want to do my housework, but I will.

When you look at older people today, see all the things they are able to do. How could that not translate into being able to work?

There are heaps of people running their own businesses at 70, or look at the age of some bus drivers. All the volunteers over 65 prove they are able to do something. It needn't be hard work, just some work.

Not being a sociable person and not having kids, I have always had the idea I would continue to do something paid or not, just to keep me involved in society. I am planning to have the choice, but do feel that working in some capacity will keep me younger for longer.

Having stated that, it must be ingrained in me to expect free money from the relatively young age of 65-70, while expecting to live to 100. It's not logic, but I can't stop myself wanting it, expecting it and fighting for it if necessary