How much money do you really need to retire?
“How much do you think you will need to retire?” It’s the kind of question that can spark anything from a shrug to a nervous laugh around the dinner table. After all, most of us are so busy working hard, raising families, and paying the bills that it is easy to put retirement in the “future me will figure it out” basket.
But those dreams, whether it’s more time with the family, travelling, or simply slowing down, all come with a price tag. The real question is: how do you make sure you will have enough to live the retirement you picture?
Retirement lifestyles: Comfortable, Choices, and Luxury
At Lifetime we tend to plan around three broad lifestyles:
• Comfortable: The essentials, plus a few extras.
• Choices: A good mix of leisure activities and some luxuries.
• Luxury: More freedom, more travel, and greater discretionary spending.
Which one sounds like you? Knowing this early makes your planning much more practical.
Understanding which lifestyle you aspire to will help you plan more effectively.
What retirement costs look like
According to the 2023 New Zealand Retirement Expenditure Guidelines, here is what retirees are typically spending each week:
| Metropolitan Area | Provincial Area | |
| One-Person Household | Comfortable: $826.26 per week Choices: $1,163.09 per week |
Comfortable: $689.54 per week Choices: $1,263.35 per week |
| Two-Person Household | Comfortable: $982.02 per week Choices: $1,665.85 per week |
Comfortable: $849.82 per week |
Source: New Zealand Retirement Expenditure Guidelines, Annual Update 2023 - Massey University and the New Zealand Financial Education Centre
Meanwhile, Weekly NZ Super rates (before tax, 2025/26):
- $627.14 for a single person living alone
- $576.80 for a single person sharing accommodation
- $952.94 for a couple (both qualify)
That leaves a gap for most people. For example, a one-person household in a metropolitan area aiming for a Comfortable lifestyle needs around $199 extra each week beyond NZ Super, nearly $260,000 over a 25-year retirement.
(Important note: These figures are illustrative only. In a full financial plan we would factor in things such as inflation, investment returns, and spending patterns, because retirement isn’t a straight line.)
Investments can act as a buffer against inflation and economic fluctuations, ensuring that your purchasing power remains strong throughout retirement.
Where retirement income comes from
- KiwiSaver: A great foundation, especially if you start early. For instance, to reach $400,000 by age 65, someone starting at 25 might save around $60 a week. Starting at 50, you would need about $342 a week. That’s the power of compounding.
- NZ Super: A reliable base, but not enough on its own for most lifestyles.
- Savings and investments: The game-changer. Diversified investments can help protect your spending power, cover the unexpected, and fund the lifestyle you want.
Retirement is not the finish line
A common misconception is that retirement at 65 is the end point of financial planning. In reality, it’s the start of a new phase that can last 20 to 30+ years. That means your plan needs to account for stages of retirement spending.
For example, you may spend more in your early years on travel and hobbies, less in your mid-years, and then more again on healthcare later on. Structuring your investments to match these stages makes a big difference.
In some situations, you may not need to touch your KiwiSaver until your mid-70s. In that case, it can make sense to keep those funds invested in a growth option well past age 60. The goal is to match your money to your lifestyle, not just to your retirement date.
Housing: A key factor
Housing plays a significant role in shaping retirement budgets. If you own your home mortgage free, your weekly costs are generally much lower, which makes a Comfortable lifestyle easier to achieve. On the other hand, if you are still paying a mortgage or renting, those regular payments need to be included in your plan.
Some people choose to downsize later in life, which can free up capital for living expenses or travel. Others prefer the security of staying in the same home. Whatever your situation, it is important to be realistic about housing costs, as they can be the make or break factor in your retirement plan.
The key is to start, no matter how small. Building a habit of saving and investing will pay off.
Bridging the gap
So how do you close the space between where you are now and where you want to be?
- KiwiSaver: Review your contribution rates, fund choice, and fees.
- Mortgage management: Paying it down faster frees up funds for retirement savings.
- Investments: Start small if you need to, time and consistency matter more than perfection.
- Advice: A tailored plan can bring clarity and confidence, and it’s worth checking in regularly as life changes.
Final thoughts
There is no “one size fits all” answer to retirement. What matters most is clarity: knowing what lifestyle you are aiming for, what it costs, and how your mix of NZ Super, KiwiSaver, savings, and investments will support it.
The sooner you start, the more options you will have. And the more options you have, the easier it is to shape a retirement that is truly your own.
Don’t leave your retirement to chance. Talk to a Lifetime Financial Adviser now and get a clear plan for the lifestyle you deserve.
Frequently Asked Questions
Q: How much will I actually need to retire in New Zealand?
A: It depends on the lifestyle you’re aiming for. A Comfortable lifestyle (covering essentials plus a few extras) costs around $826 a week for a single person in a metro area. NZ Super pays $627, which leaves a shortfall of about $199 a week, nearly $260,000 over 25 years. The Choices and Luxury lifestyles require even more, so having a clear target early makes planning much easier.
Q: Isn’t NZ Super enough to live on?
A: Not for most people. While NZ Super provides a solid base ($627 a week for singles living alone and $952 for couples) it generally only covers the basics. To fund travel, hobbies, or even just a Comfortable lifestyle, you’ll likely need additional savings and investments.
Q: Where should my retirement income come from?
A: Think of it as a three-legged stool:
- NZ Super: reliable but limited.
- KiwiSaver: a powerful base, especially if you start early.
- Savings and investments: the game-changer, giving you flexibility, growth, and protection against inflation.
Together, these create a more secure and balanced retirement plan.
Q: What role does housing play in retirement planning?
A: A big one. Retiring mortgage-free means lower weekly costs and more room for lifestyle spending. If you’re still paying rent or a mortgage, those costs need to be built into your plan. Downsizing or freeing up equity later in life is another way to make retirement more affordable.
Q: I’m starting late, is it too late to catch up?
A: It’s never too late. Even in your 50s or 60s, smart strategies like increasing KiwiSaver contributions, paying down debt, or redirecting mortgage payments into investments can dramatically improve your retirement outlook. Consistency matters more than perfection.
Q: What’s the single most important step I can take right now?
A: Start. Whether it’s reviewing your KiwiSaver fund, setting up regular investments, or speaking with an adviser, taking action today gives you more options tomorrow. Retirement planning isn’t about getting everything perfect, it’s about building momentum.
This article is for general information purposes only and does not constitute financial advice. The content is based on information current at the time of writing and may be subject to change.
Lifetime Group Limited is a licensed Financial Advice Provider. For advice specific to your situation, please speak with a Financial Adviser. You can view our Disclosure Statement here.
All investments involve risk and are not guaranteed. Any examples or projections are for illustration only and should not be relied on as advice.
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