Rise in retiree renters to influence data in decades to come
A handy advisor tool in the form of the Massey University Retirement Expenditure Guidelines, published annually, provides a useful snapshot of how the post-work years are shaping up for the baby boomer generation.
Tuesday, March 4th 2025, 6:58AM
by Kim Savage
A handy advisor tool in the form of the Massey University Retirement Expenditure Guidelines, published annually, provides a useful snapshot of how the post-work years are shaping up for the baby boomer generation.
But it is yet to fully reflect how renting in retirement will impact spending, says guidelines’ author, Associate Professor Claire Matthews, in a presentation to a Financial Advice New Zealand online event.
“Our current retirees are baby boomers and older, and we have a very high proportion of home ownership and home ownership without a home loan.
“So they've paid it off, and so they've got this debt free home that they're living in, and so that is influencing their expenditure.”
It will be five years or more, Matthews says, before future generations, made up of a higher proportion of renters, come through in the numbers.
Hawkes Bay financial planner Christine Hay, who chairs the FANZ Financial Planning and Investment Member Advisory Committee, says it will be clear to advisors if their clients are likely to be homeowners and debt free or not, because they’re usually working with them well in advance.
“If it looks like they're going to still be renters in retirement, and we can't help them get to be owners, we have to allow for that expenditure.
“I think we take responsibility for that rather than taking it from the data,” says Christine Hay.
Claire Matthews says the changing demographic and what it will eventually show in the expenditure picture is a reminder that young people need to seriously think about whether they expect to have their own home and whether it will be paid off in time.
“If they're not going to be in their own home, if they don't fund more, then they're going to be reducing their expenditure, and they're not.
“They might still be spending the same amount of money, but a lot more of it's going to be going on housing than it would be otherwise.”
| « [The Wrap] Bye Bye Bayly |
Special Offers
Comments from our readers
No comments yet
Sign In to add your comment
|
|
Printable version |
|
Email to a friend |
