Four simple tips for a rewarding retirement

Financial Planning News

The first rule of retirement income is ‘make sure you never run out of money.’ The second rule of retirement income is – you guessed it – ‘make sure you never run out of money.’

In all seriousness though, there are a few things you can do to make retirement relaxing and rewarding, without the worry that your funds will dry up.

Tip 1. Plan your transition from saving for retirement, to spending in retirement.
You’ve spent your working life saving for retirement. So what happens when you do retire and the money starts flowing the other way? Everyone’s retirement is different. Some people stop working, some continue in their life long careers but with a reduced workload, some start new work and some may just choose to enjoy doing things completely differently. One of the greatest myths in retirement is that it’s about stopping, in our view it’s all about starting!

A flexible plan that balances NZ Superannuation, retirement savings and new sources of income with everyday spending needs, is the first step in enjoying a rich and rewarding retirement. At Britannia we have a number of  that will help you take control of your retirement income and make a successful transition from saving to spending.

Tip 2. Don’t put all your eggs in a term deposit.
This mistake is easy to make – term deposits certainly have their place as they provide certainty and security. Unfortunately they don’t pay you much interest, and you can’t access funds (unless you’re prepared to pay a penalty) until they mature. In addition, term deposits are not an adequate hedge against the erosive impacts of long term inflation. Global interest rates are historically low and that doesn’t look like changing anytime soon, so it’s best to look for other ways to help maximise your hard earned savings.

Tip 3. Know how much life costs.
Massey University has taken a long, hard look at living costs for retired people in New Zealand. Their 2016 study calculated that a no-frills retirement outside Auckland, Wellington or Christchurch would cost $421 per week for a single person and $680 for a couple. It’s even more in the big cities and if you want any extras you’ll have to add a few hundred dollars to those weekly budgets.

Currently, NZ Super pays $390* per week for someone living alone or $600.30* for a couple. So it’s best to start planning now how you can make up the difference.

Tip 4. What’s the life expectancy of your savings?
It’s great news that Kiwis now enjoy a much longer life expectancy. However, many people don’t realise just how long that is. If you reach 65 you can now expect to live another 18 years (if you’re a man) or more than 21 years (if you’re a woman). Life expectancy continues to go up so if you’re only 55 now, chances are it will be even more when you get to 65. As a result you could be facing a situation where you’re retired for a third of your life, and reliant on retirement income all that time.

When you look at things in this light you need to start thinking of ways to protect your savings while still growing them.

Depending on your individual circumstances, Britannia’s Lifetime Income Fund may tick both these boxes. It combines managed investment funds to deliver growth (with gains locked in annually) and longevity insurance to generate lifelong payments.

Want more? Talk to us.
If you have a UK pension, KiwiSaver account, a Term Deposit about to mature, or if you’re just interested to see how much you could receive every month with the Lifetime Income Fund, the first step is to get in touch.

Call us on 0800 500 811 or email us at 

*NZ Super rates current as at 1 April 2018 with net rates based on M tax rate. The couple rate is the total paid where both qualify.


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Product Disclosure Statements for the Britannia Retirement Scheme and the Integral Master Trust are available from the Scheme's issuer, Britannia Financial Services Limited, phone 0800 500 811.

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