Confidence sits at 37%, calculated numbers at 6%: the gap in NZ retirement planning

Confidence is the easiest part of a retirement plan to carry around. It travels well, it feels good, and it rarely gets audited.

In the Circulus My Future Lifestyle quiz, 758 people rated how confident they are that they are on track to have the nest egg they need. Across those responses, 280 people - roughly 37 percent - placed themselves at 7 or higher on a 10 point scale. Another 224 (about 30 percent) sat in the middle at 5 or 6. At the top of the scale, 39 people (around 5 percent) chose a 9 or a 10.

So a little over a third of respondents feel broadly on track. The interesting question is what that confidence is resting on.

What sits underneath the confidence

Of the 731 people who answered the question on whether they have ever calculated how long their investment funds would support their lifestyle, 46 - about 6 percent - said they know the number. A further 269 (37 percent) reported having a rough idea, and 337 (46 percent) said they have thought about it.

That sits alongside a strong appetite for certainty. Among 702 respondents, 486 - roughly 69 percent - rated the importance of knowing they will have the funds they need at 8 or higher out of 10.

Inflation adds a second layer. Of 692 people, 345 (50 percent) said their thinking was in today's dollars, and 72 (10 percent) said they had built inflation into their numbers.

The lifestyle people are picturing

The lifestyle side of the quiz suggests the numbers being estimated have real content behind them. Of 704 respondents asked to put a weekly figure on the retirement they had described:

• 158 (22 percent) landed in the $1,650-$1,920 band, the single largest group
• 396 (56 percent) estimated $1,650 a week or more
• 89 (13 percent) estimated under $1,110 a week

Meanwhile, 419 of 770 respondents (54 percent) enjoy a trip or two most years, and 284 of 741 (38 percent) describe their ideal future as travelling often and living comfortably.

A benchmark worth checking against

Massey University publishes its New Zealand Retirement Expenditure Guidelines annually, drawing on what retired households across the country actually spend. The guidelines include a "Choices" budget covering a lifestyle with some extras in it, reported separately for metro and provincial households - a useful external reference point for anyone comparing their own weekly estimate against observed retiree spending.

It is worth noting that 581 of 839 respondents (69 percent) picture themselves in a metro area, where the Massey figures are typically reported at a different level from provincial households.

The quiz also captured how people reacted once they saw a figure. Of 721 respondents, 359 (50 percent) said it was about what they expected, 199 (28 percent) called it a wake up call, and 131 (18 percent) said they would need more than that.

For the 37 percent who rate themselves at 7 or above, the data raises a fair question: what would it take to move that confidence from a feeling to a figure? The Circulus quiz is one starting point, and a licensed financial adviser can work through the detail alongside you.

This article is general information and is not personalised financial advice.