NZ Herald 23 May 2026

AGosh, your crystal ball must look black. And you’re not the only younger person who is pessimistic about the future of NZ Super. I hear it quite often.

While nobody can guarantee what a future government will or won’t do, I’m sure you are wrong.

We live in a democracy, where those making unpopular decisions are voted out. Not only would nearly all younger people vote against ending Super, but many older people — parents, grandparents and anyone else with a sense of fairness — would too.

All the experts, at Treasury and elsewhere, who project the country’s future finances always include Super payments.

They also factor in using money from the NZ Superannuation Fund. This Fund is huge. It holds about $87 billion in assets — more than half the $143 billion total in all KiwiSaver funds.

And, by the way, the Super Fund was recently named the world’s best performing state-owned investment fund over the past 20 years.

Withdrawals from the Super Fund to help pay for NZ Super will probably start in 2034 and gradually increase. At its peak, Fund money is expected to pay for nearly 12% of NZ Super in 2084, “averaging 6.4 percent for the 50 years between 2040 and 2090.”

“The Fund will also be paying tax to the New Zealand government,” it says. “On current forecasts, capital withdrawals and tax payments combined will equal 19.4 percent of the total annual net cost of pensions in 2084.” That’s a pretty big helping hand.

The Fund notes that withdrawals “cannot be used for other purposes (such as economic development or fiscal stabilisation).”

So the presence of the NZ Super Fund pretty much guarantees Super payments will continue for you and younger people, although it’s likely they will be modified somehow.

Possible scenarios are: raising the starting age from 65, slowing down the pace at which payments grow each year, and means testing Super so better off people receive less. Some of these are discussed in Q&As below.

That leads us to your point about penalising those who have saved. It’s one of the strong arguments against means testing, partly because of the message it would send younger people. Nobody benefits if the young reduce or stop their saving because they think people with higher retirement balances will get less from the government.

By the way, NZ Super is not a Ponzi scheme. I can see where you’re coming from. Ponzi schemes are scams that pay existing investors with funds collected from new investors — which is sort of what happens with Super.

But NZ Super is really just another government expense, like health or education. We use some taxpayer dollars to ensure old people aren’t in poverty. And I’m confident you’ll get your turn at being on the receiving end!

AI haven’t heard anyone suggest that, if they raise the Super age, those already retired will still get the money from 65 — which you seem to imply.

However, I can’t imagine any government raising the age without lots of warning.

In March 2017, then Prime Minister Bill English announced an increase in the Super age from 65 to 67, but it was never enacted as National lost the election later that year.

The change would have started a full 20 years later, and wouldn’t affect anyone born before June 1972.

In the meantime, many other countries are going through the process, or have already done so, including Australia, the United Kingdom, Denmark, Germany and the United States.

And recently, National again said it will gradually raise the age to 67, starting in 2044. The change wouldn’t affect anyone born before 1979. ACT has also supported raising the age, but NZ First has opposed it.

Meanwhile, Labour, the Green Party and Te Pāti Māori want the age to stay at 65.

Who knows what lies ahead? But I’m sure people would be given plenty or notice.

On your older colleagues starting Super at a younger age, on average they had a shorter life expectancy than you — and so didn’t necessarily receive Super for more years than you will.

AIt seems not many over 65s don’t apply for Super.

I asked Dr Claire Dale at the Pensions and Intergenerational Equity (PIE) research hub at the University of Auckland.

Her reply: “From MSD: As of the second quarter of 2025, over 941,000 people were receiving NZ Super. From StatsNZ: As of mid-2025, there are an estimated 924,823 people aged 65 and older in New Zealand.”

How come? Some of the first group will be people under 65 married to over 65s. While under 65s can no longer receive Super, some people used to be eligible. And since that changed, those already getting the money continue to get it.

Adds Dale, “These numbers suggest very, very few people eligible for NZS are not claiming it.”

Read on for more about donations.

AWell done on your support of the man. It’s great to hear how it has helped him. And thanks, too, to all the other generous souls you write about.

The only bit I baulk at, just a little, is your comment about supporting hospitality by eating out. When we spend on anything, we support the people who provide the product or service, but we get something back. It’s not quite the same as charity!

Another correspondent commented: “Your readers who feel so strongly about NZ Super being available to all regardless of means might be slightly mollified to know about Share My Super, a charity that facilitates donation of super funds to charities.”

Indeed. Through Share My Super, over 65s can give part or all of their NZ Super payments to support children. The charity says, “children are three times more likely to be living in material hardship than people aged over 65.”

AGosh — especially to your suggestion about placebos! Perhaps we should call you Ebenezer Scrooge, after the character in Charles Dickens’ book A Christmas Carol who argues the poor should be left to die off, to “decrease the surplus population”.

If you have reached 90 without any use of life-prolonging medication, you’re doing remarkably well.

I have more sympathy for some of your other arguments. Means testing would, indeed, be hard to police. And the issue of penalising saving, mentioned earlier, is a tricky one.

Okay. I’ve let NZ Super dominate the column again. After all, it’s important and it affects pretty much everyone.

I still have a few other letters about the topic that I’ll run next week. But please, no more correspondence on this topic for at least a few months! There are too many other good letters waiting impatiently in line.

AA really good question — that applies equally to KiwiSaver and non-KiwiSaver funds. It’s something every fund investor should be aware of.

Many growth funds always hold between 63% and 90% growth assets, such as shares or commercial property. Those are the cutoff points for classifying a fund as growth on the Retirement Commission website, sorted.org.nz.

And many aggressive funds always hold 90% or more growth assets.

However, some fund managers attempt to time markets, selling growth assets when they think prices are going to fall, and putting the money into lower risk cash or bonds. Then they buy shares or property again when they expect price rises.

So — while they call their fund a growth fund, at a given time it might hold just 30 or 40% shares or property, possibly less.

How does the Sorted website deal with this?

“To categorise funds, we’ve chosen to base the groupings on their actual allocation (ie, not just their stated target) in order to be as transparent as we can and for investors to know what’s really being held in their fund,” says Tom Hartmann, personal finance lead at the Retirement Commission.

A fund’s label — defensive, conservative, balanced, growth or aggressive — is decided twice a year by their investments as reported on the Disclose register every six months, on 30 September and 31 March.

Hmmm, I said to Hartmann, “This could presumably lead to quite big problems if, soon after they have reported to Disclose, a fund manager makes big changes to the asset mix in a fund.

“An investor could find themselves in a higher or lower-risk fund than they intended.

“It would be good to be able to tell readers how to look out for this being a possibility. Do you know if fund managers have to tell investors if/when they make more than minor changes to their asset mix?”

His reply: “To our knowledge they are only required by law to disclose their portfolio holdings twice a year.”

I hope, though, that fund managers who vary their risk level considerably make that clear to their investors. At least their fund descriptions on their websites should point this out.

As a general rule, these will be active managers, as opposed to passive managers who run index funds and similar. One way to tell an active manager is to compare fees, which you can do on the Smart Investor tool on sorted.org.nz. Their fees are usually higher.