Kaupapahere me te rangahau | Policy and Research

Decumulation refers to the process of drawing down savings that have been accumulated over the working life to provide income in retirement. Since the inception of KiwiSaver in 2007, regulators, policymakers and providers have focused on the accumulation phase of saving in KiwiSaver. However, KiwiSaver has now been in existence for more than 14 years, and it is expected that individuals approaching retirement are now doing so with larger sums of money accumulated in KiwiSaver. We see the focus is switching to decumulation and what this means from a product and policy perspective.

Much of the work we conduct focuses on enabling New Zealanders to retirement comfortably once they reach 65. Less well understood are the financial experiences of those nearing and past retirement age.

Our research aims to reveal more about the experiences of work, income, expenses, and financial advice among those close to retirement and those already retired. Of specific interest was how those aged 65 accessed and spent any savings and income (including Kiwisaver).

Expenditure patterns of New Zealand over 65 households

This research uses household-level data from the New Zealand Household Economic Survey to examine expenditure patterns of over 65s.

Household expenditure patterns differ significantly across demographic groups and income levels.

As households age, they spend less, especially on discretionary categories such as clothing, transport, and recreation and culture. The research finds that subjective wellbeing is higher for over 65 households who have higher qualifications, own their home, have higher incomes, live with their partner and have no dependent children, and is the lowest for rent-paying renters, single living with others and Māori households.

Decumulation research from previous RRIPs

A paper commissioned for the 2019 RRIP provided an assessment of decumulation of retirement savings and other assets. Download the paper.

Another report from the 2019 RRIP also considered decumulation, and considered decumulation models available in a number of OECD countries. Download the report.

The 2016 RRIP looked at decumulation from a number of perspectives, including surveys, reports and interviews with the public.