Retirement at 65 has long been considered the Kiwi dream - but for many, it’s slipping further out of reach. We explore the habits, mindset, and money mistakes that are quietly derailing retirement plans for thousands of New Zealanders.
You're Still Carrying a Mortgage Into Retirement
If you want to retire at 65, clearing your mortgage needs to be a top priority. It’s your single biggest cost – and one that many Kiwis are now taking with them into retirement. With mortgage interest often doubling the initial loan amount over time, paying down this debt is one of the best financial moves you can make.
Rather than chasing high-risk investments, paying off your home loan offers a guaranteed return and a strong foundation for financial freedom. There may be times you can only make minimum repayments — during parental leave or in periods of higher living costs – but the goal should always be to reduce debt as quickly as possible.
You’re Trying to Get Rich Quick
One of the biggest mindset traps is believing you can shortcut your way to wealth. Many people are investing in shares or cryptocurrency while still juggling personal loans or credit card debt. But if you’re earning 8–9% on an investment while paying 15–20% interest on debt, the maths just doesn’t stack up.
It might feel like progress, but unless you’re eliminating high-interest liabilities, you’re going backwards. Real wealth is built slowly — through discipline, consistent effort, and smarter financial decisions.
You Don’t Track Your Income or Spending
Your income is your greatest wealth-building tool – but it’s useless if you’re not managing it. Too many Kiwis are living on autopilot, spending their entire paycheque and assuming more will come later. This mindset leaves people unprepared for the future and unaware of how much they’re actually saving or investing.
If you aren’t budgeting or tracking your expenses, you won’t know whether you’re building wealth or just treading water. As incomes grow, so does lifestyle inflation – unless you’re intentional about how you use your money.
You're Relying on a Broken System
Expecting KiwiSaver and NZ Super to take care of your retirement? That’s a gamble. In 2024, 45% of 65–69 year olds were still working – and often not by choice. The average KiwiSaver balance sits at just over $37,000 – barely enough to function as an emergency fund, let alone fund a 20–30 year retirement.
Worse still, many Kiwis withdraw their KiwiSaver for a first home and never rebuild it. Combine that with a mortgage still hanging over your head, and the numbers don’t work. Meanwhile, New Zealand Superannuation is ballooning in cost, projected to hit $45 billion by 2037 – a pressure point that may force future changes to eligibility or benefits.
Real-Life Example: Sarah's Story
Take Sarah, a 35-year-old earning $300,000. On paper, she’s successful – with a thriving business, a beautiful home, and a family bach. But behind the scenes, she’s financially stuck. She contributes the bare minimum to KiwiSaver, doesn’t track spending, and saves inconsistently.
After taking on more debt to purchase a holiday home, she’s now asset-rich but cash-flow poor – with no structured financial plan and no buffer. Despite her high income, she’s likely to work well into her 60s, downsize her lifestyle, and struggle to support her children into their first homes.
Sarah’s story is a common one – showing that income means nothing without structure, discipline, and long-term planning.
Key Takeaways
- A mortgage in retirement is a major financial anchor – prioritise paying it off.
- Don’t chase investments if you’re still carrying high-interest debt.
- Track your income and expenses to avoid lifestyle inflation.
- KiwiSaver is a tool – not a safety net. Don’t rely on it alone.
- Most people underestimate how much they’ll need to retire comfortably.
- NZ Super’s future is uncertain — plan for independence, not dependence.
- Saving what’s “left over” each month is not a plan.
- High income doesn’t equal financial security — strategy matters more.
- Start planning early to avoid forced work in your 70s.
- Be honest about whether your current financial decisions support your future goals.
Next steps:
Worried about whether you’re financially ready for retirement? Chat to Lighthouse Wealth to build a financial plan that gives you confidence and control.
If you’d like to learn more, check out these other episodes below.
For a no obligation discussion to see how we can help you on the path to wealth, please contact us.
Disclaimer:
The information in this article is general information only, is provided free of charge and does not constitute professional advice. We try to keep the information up to date. However, to the fullest extent permitted by law, we disclaim all warranties, express or implied, in relation to this article – including (without limitation) warranties as to accuracy, completeness and fitness for any particular purpose. Please seek independent advice before acting on any information in this article.
