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The survey was undertaken by Statistics New Zealand and funded through the Retirement Commission.

“The survey is a valuable addition to our country’s knowledge base,” says Retirement Commissioner, Colin Blair. “It’s vital data that will help to plug
information gaps for policy development across the public sector. It will be used by the 2003 Periodic Reporting Group looking at retirement income policies, and will have value for economists, academics and the financial services industry.”

“A study of this kind was first mooted by the Todd Taskforce 10 years ago, so it has been a long time coming,” says Colin Blair. “Until now, we’ve only had indications of savings at a national level, and very little information about how assets are distributed throughout the population.”

There is a great deal of information in the survey. It has data available on topics from student loans to the value of businesses.

“Different people will have particular issues they want to examine. This study gives them the opportunity to get a much closer picture.”

The information in the report shows for New Zealand households, first, the level of net worth (assets minus debts) of New Zealanders, and second the composition of that net worth.

Colin Blair says the real value from the survey will come from the further analysis that is planned, answering questions such as “Are households saving enough to replace income in retirement?” and “What are the characteristics of those with different levels of net worth?”

“Better information about New Zealanders’ saving behaviour should lead to better policy making. Decisions based on facts must be better than decisions based on hearsay or gut feel. On that basis this type of information is invaluable,” says Colin Blair.

“It will also help in the development of other key social policy programmes, and if repeated, can provide a better understanding of the impact of tax and other policy changes on saving behaviour, and a range of other macro- and microeconomic issues.”

The Retirement Commissioner emphasises the importance of repeating the survey, as it captures New Zealanders’ net worth at one point of time. He says, “Many questions raised by the data will only be answered by a repeat of the survey”.

“Improved statistics on private saving and net worth will also assist the Retirement Commission to improve our Sorted public education
programme, which promotes independent personal financial information”.

The two following tables are examples of the data available in the report:

Insert tables

Reports

Electronic copies of the survey are available from the Research section of the Retirement Commission’s website www.sorted.org.nz and from Statistics New Zealand’s website www.stats.govt.nz. Hardcopies of the report can be purchased from the Statistics New Zealand customer services centre at a cost of $35 (Toll Free Number: 0508 525 525).

More Information

See the attached Backgrounder for more information on the survey.

Colin Blair, Retirement Commissioner will be available for comment.

Further information:
Robyn Cormack
Communications Manager
04 494 6243
Email: robyn.cormack@sorted.org.nz

The Net Worth of New Zealanders - Household Savings Survey

Background Information Summary

How did the survey come about?

The 1991 Review of Income and Wealth Statistics identified shortcomings in wealth statistics, and recommended that coverage of wealth statistics needed to improve.

In 1992 the Task Force on Private Provision for Retirement identified the need for regular information covering patterns of voluntary private savings and lifecycle statistics on income, expenditure, wealth etc.

In its interim report in July 1997, the Periodic Report Group, charged with reviewing retirement income policies, expressed disappointment that with one exception there had been “little change since 1992 in the quality of statistics available to inform the debate on individual and national savings levels and patterns”.

In 1997 a Steering Group was established to identify the priorities and requirements to improve the quality of statistics in this area.

Funding was provided in the 1999 budget.

Cost

$2.3 million over 3 financial years was allocated to the Retirement Commission.

Contractor

Statistics New Zealand undertook the survey.

Advisors

A group of advisors were established to assist Statistics New Zealand in the development of the survey. Advisors were mainly economists from Treasury, universities, and private companies.

Purpose

To assist in the formulation of retirement income and associated policies, the Government requires information on net worth and savings.

Content

The Household Savings Survey was designed to collect information on the level, composition, distribution and accumulation of net worth (assets minus debts) in the population.

Data includes:
Ownership and value of:
Maori assets
Property
Farms
Life insurance
Financial assets (managed funds, shares)
Owed money (asset)
Credit card and store card debt
Mortgages and bank loans
Money owed to others
Family trusts
Businesses
Registered superannuation schemes
Cash, near cash and bank deposits
Motor vehicles
Other assets
Student loans
Hire purchase

Age
Sex
Ethnicity
Marital status
Highest educational qualification
Labour force status
Income

Maori

A Maori booster sample was included to improve the reliability of information collected on Maori.

Limitations

Usual limitations associated with a sample survey as not everyone in the population is surveyed.

It is likely that considerable wealth is held by a small number of New Zealanders. These people may not have been selected in the sample surveyed. No high net worth booster sample was undertaken. Hence aggregate data from the survey may under-estimate total wealth owned by New Zealanders.

The survey only collected information on assets and debts with a market/monetary value. Hence in terms of student loans, the liability has been collected but no corresponding asset.

Survey dates

August to November 2001

Sample size

5374 total
2392 individual
2982 couples

Response rate

74%

Validation

Where possible survey data was compared to existing aggregate data from other sources. There were notable differences in definitions.

Type of survey

The survey was cross-sectional. That is, a one-off survey at a particular time.  However, it is hoped to repeat the survey so that trend information can be produced.

Wealth measure

The survey collected information on the STOCKS rather than FLOW definition of savings. This means the net worth was calculated by asking respondents the estimated market value of all their assets and liabilities as at the day of interview. The flow definition of savings uses the difference between income and expenditure.

This first concept will allow a point in time assessment of the level of net worth of New Zealanders. Distributional and compositional information will also be available.

The second concept was to collect information to allow estimation of the future income stream of the respondent.

This concept will allow estimation of net worth at future dates. The aim is that the survey will collect adequate information to allow analysts to create models and estimate net worth at future dates. SNZ will not provide estimates of future
net worth as part of the standard output from the survey.

Future analysis

A joint venture research proposal between the Retirement Commission, Treasury and Waikato University is being under taken. Results will start to become available from November 2002. This will include two key issues:

1. What are the determinants of household wealth?
2. Are household savings adequate for retirement?

Attachment
Are NZ’ers Saving Enough for Retirement?