Retiring

Who maintains a retirement village or retirement home? The retirement village or retirement home owner (or operating company) is normally responsible for maintaining buildi...
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Q & A

Will moving to a small town or rural area improve my life?

If you’re the sort of person who enjoys change and have handled major life changes well in the past, moving to a small town or rural area could be just the change you need to unlock the full benefits of retired life. You should however note:
  • A move like this won’t guarantee a calmer, happier existence.  Small town living can be just as hectic as a city lifestyle, if you like to keep busy
  • Having a support network in the new location will be an important factor in ensuring a happy move.  It can take some time to build these support networks.  Consider attending local churches or community groups, or joining the RSA or similar service organisations, to help fast track this process
  • You may not like the change to a different geographic area if it means missing friends and family.  You should also consider which services you use in your current city, such as medical services, convenient shopping, restaurants and take away food outlets and other entertainment services.  If similar services are not available in your new location, you may find this frustrating
  • The climate in your new location must be right for you and your wellbeing.  Retirees tend to pick naturally warmer areas of New Zealand, to avoid getting unnecessary colds and flus, whilst reducing home heating costs
Your local First National Real Estate office can provide further helpful information.

Can I buy a retirement property with my KiwiSaver funds?

Once you qualify for New Zealand Superannuation (currently at the age of 65), you also become eligible to withdraw funds from your KiwiSaver account. You can opt for small regular withdrawals to supplement your superannuation, or you can withdraw a lump sum up to your full account balance. All funds withdrawn from the account are tax free.

Withdrawing money from your KiwiSaver account may be useful when investing in a retirement property, but make sure you'll still have enough income available (from KiwiSaver or other investments) to support yourself in retirement. 

Do all retirement villages and retirement homes charge entry fees?

Most retirement villages and retirement homes charge an entry fee.  This fee usually goes towards ongoing updates to the common property and individual homes / units.

If you have limited funds, some villages may offer an apartment and negotiate a small donation of several thousand dollars.  Speak to the sales representative at your chosen retirement village or retirement home for more information.

I read something online about Stamp Duty. What is this and will it affect me when buying into a retirement village or retirement home?

Stamp Duty is a tax or fee levied on official documents that some countries and states charge, particularly when transferring property ownership. New Zealand does not levy Stamp Duty, so you will not be affected when buying a retirement home.

What legal rights do I have in a retirement village or retirement home?

Retirement villages and retirement homes are shared living spaces, occupied by a number of retirees.  The rights you enjoy in a retirement village may differ from those when you own a residential home - but there are some similarities.
  • Whether you own the full title to your property or you enter into a lease, you will generally enjoy a similar level of security to that of owning your own home
  • In registered retirement villages, all residential units will have ‘memorial on the land title'. This means that if your retirement home operator borrows money and can't repay the loan, the lender is not able to evict you and sell the unit to recover their money
  • Before you sign any contract, make sure to review the terms and policies of the retirement village with a legal advisor to make sure you understand everything you are agreeing to.  Terms will differ across retirement homes

Who maintains a retirement village or retirement home?

The retirement village or retirement home owner (or operating company) is normally responsible for maintaining buildings, common areas, recreational facilities and gardens. While rules may vary from village to village, individuals are typically responsible for their:
  • Private outdoor areas (near their property)
  • Home Interiors (of the property)

Will I prefer living in a retirement village or retirement home to a private house?

Whether you will enjoy retirement home living is entirely dependent on your individual outlook and how much you value your independence. The benefits of living in a retirement village or retirement home include:
  • No longer having to deal with maintaining real estate
  • The social interaction, community and regular activities provided by the retirement village, which can help to reduce the sense of isolation often experienced in retirement
  • Access to public transport or dedicated transport services, making it easier for you to continue enjoying a normal lifestyle when driving is no longer possible
Talking to friends or family when considering a retirement village may help you to better assess whether you should stay in your own home, or move.

When should I retire?

The age of eligibility for New Zealand Superannuation is currently 65 years, and this is when a large proportion of New Zealanders choose to retire from the workforce.

You can still receive your New Zealand Superannuation while you are working or receiving other income. Retirees should consider the following when working beyond the New Zealand Superannuation eligibility age of 65:
  • Only continue to work if you’ve received medical advice that working longer won’t be detrimental to your health
  • Consider reducing your hours and working part time rather than continuing in full time work, unless this would cause you financial issues
  • Make sure you consult your financial planner about the amount of income tax you will have to pay if you are receiving NZ superannuation along with income from working
  • Make sure you have discussed any working arrangements with your employer. Some employers may only consider your application to work after the common retirement age of 65, if they believe your health will not suffer
Growing life expectancies, along with recognition of the health benefits of continued mental stimulation through work, have led to a growing number of New Zealander's continuing to work well into their 70's or even 80's.  

What about early retirement?

Early retirement is a dream for many, but very few people achieve it. Unless you win the lottery, it's important to assess the positive and negative impacts of an early retirement. Specifically, you’ll need to make sure that:
  • Your financial obligations can be met without income from employment or your NZ Superannuation
  • You have sufficient plans (travel, hobbies or part time activities) to keep you occupied and mentally stimulated
  • You have discussed your plans, and the implications of early retirement, with your family

What is the difference between assisted living retirement homes and independent retirement living?

Assisted living generally refers to having nursing or support staff on hand within the retirement living premises to help retirees. Often they will provide meals, do laundry, cleaning, and provide after-hours general and medical care.

Retirees should consider assisted living when:
  • You’re having difficulty managing daily chores such as cooking, housework and moving, or you need help with showering or bathing
  • You’ve been advised by a medical professional that continuing to live independently may be detrimental to your health
  • You have a partner who requires increased supervision for medical or other reasons, that you do not have the personal capacity or experience to provide
The sales representative at your intended retirement village should be able to offer advice on whether assisted or fully independent living options are best for you.
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