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Financial planning for retirement

PSS and GSF, NZ Super, KiwiSaver, financial advice, retirement income, housing choices and useful tools.

Retirement-ready: a practical guide for Police Association members

Leaving Police is one of the biggest transitions you will make. A good retirement does not happen by accident, but planning for it does not need to be complicated.

Start by understanding what NZ Super is worth, what other benefits become available at 65, and what your Police superannuation and savings could provide. Once you know the income you are likely to have, you can compare it with the lifestyle you want and identify any gap early enough to do something about it.

This guide follows a timeline. You do not need to read it all at once. Go directly to the stage or subject that applies to you.

Find what you need

Heading towards retirement

  1. Start here: know what NZ Super and your benefits are worth
  2. Five or more years out: build the foundations
  3. Around two years out: firm up the plan
  4. Your final 12 months: take the practical steps

Once you have retired

  1. Your first year: turn savings into income
  2. As the years go on: review and adjust
  3. Using your home to support retirement
  4. Stay scam-smart
  5. Where to get help

Important: This information is general and is not financial advice. Your circumstances are unique. Get personalised financial and legal advice before making significant or irreversible decisions.

Part One: Heading towards retirement

Before deciding how much you need to save, understand what you are likely to receive from NZ Super and what other benefits may be available from age 65. These form the foundation of your retirement plan.

NZ Super: your starting income

NZ Super is paid fortnightly for life to eligible New Zealanders from age 65. It is not income or asset tested, so you may still receive it if you continue working or have savings and investments. It is taxable, and the amount depends on your living arrangements and tax code.

Check the current rate that applies to you, then convert it into weekly and annual household income. This gives you a reliable starting figure to compare with your expected retirement costs.

If you have a partner, remember that you may not both qualify at the same time. Different ages and retirement dates can create a period when one person receives NZ Super and the other does not. If you leave Police before 65, you will also need to fund the gap between your final salary and your first NZ Super payment.

Check it:Current NZ Super rates, eligibility and payment information

SuperGold Card

When your NZ Super application is approved, you will generally be sent a SuperGold Card automatically. It is free and gives you access to discounts and special offers from participating businesses, along with eligible public-transport concessions.

The standard SuperGold Card does not expire. Offers can change, so check the SuperGold website or app for current discounts and services.

SuperGold and Community Services Card combo card

The Community Services Card is income tested and can reduce the cost of some healthcare services, prescriptions and public transport.

If you already have a Community Services Card, it will stop working when your NZ Super is approved because your income circumstances have changed. You will need to reapply. If you still qualify, you will receive a combo card, combining your Community Services Card and SuperGold Card in one.

The combo card:

  • provides the discounts and subsidies available through both cards;
  • has the initials CSC and an expiry date on the back; and
  • may be renewed automatically, although Work and Income may ask you to reapply if your income is close to the eligibility limit.

Check your eligibility: Community Services Card and SuperGold Card information

See the complete income picture

NZ Super and card-based benefits are only the beginning. Your retirement income may also come from PSS or GSF, KiwiSaver, savings, investments, part-time work, rental income or, later, your home.

Try it yourself: Sorted's Retirement Calculator estimates the income and savings you may need for different retirement lifestyles.

Want help with the numbers? Naked Finance provides free financial advice for Police Association and Police Welfare Fund members.

Five years may feel like plenty of time, but decisions made now can make a meaningful difference. This is the stage for understanding your position, building savings and reducing future pressure.

Know what retirement will cost

Start with one question: what will it cost to live the retirement you want?

Estimate your likely weekly spending and separate it into:

  • essentials, such as housing, food, power, insurance, transport and healthcare;
  • lifestyle choices, such as travel, hobbies, eating out and helping family; and
  • larger occasional costs, such as replacing a vehicle, painting the house or major dental work.

Compare this with your expected income from NZ Super, PSS or GSF, KiwiSaver and other investments. The difference is the gap your plan needs to solve.

Do not build a plan around an unrealistically low budget. Retirement should cover ordinary life as well as the things you have worked hard to enjoy.

Understand your Police superannuation

For many members, PSS or GSF will be one of their largest retirement assets. The important question is not only what is the balance? It is also what income and other benefits could it provide?

Police Superannuation Scheme (PSS)

Check your balance, contribution rate and investment option. Use the Retirement Income Calculator in your PSS online account to see what your projected savings could provide.

Consider:

  • whether you are contributing enough while still earning;
  • whether your investment option suits when you expect to use the money;
  • what happens to your savings when you leave Police;
  • whether retained membership is available; and
  • the withdrawal and regular-income options available in retirement.

Contact PSS: policesuper.co.nz, 0800 777 243 or psscheme@mercer.com

Government Superannuation Fund (GSF)

If you are a GSF member, different rules apply. Your entitlement may be a defined benefit rather than simply an account balance, and decisions about your retirement date or benefit may have long-term consequences.

Ask GSF what your benefit is worth, what income it could provide, what happens if you retire earlier or later and what survivor benefits apply. Obtain advice before making an election that cannot be reversed.

Contact GSF: 0800 654 731, gsf@fundadmin.nz for membership enquiries or enquiries@gsfa.govt.nz for general enquiries.

KiwiSaver

KiwiSaver can continue to play an important role after 65. You do not generally need to withdraw it all as soon as you become eligible. Many providers allow you to stay invested and make regular or one-off withdrawals.

Review your projected balance, fees and fund type. The right investment setting depends on when and how you expect to use the money, not simply your age. Money needed soon may require a different approach from money intended for later retirement.

Try it yourself: Sorted's KiwiSaver Calculator and Fund Finder.

Make the most of your remaining working years

Your final years in paid employment may be your strongest saving years. Consider whether you can:

  • increase your superannuation or other savings;
  • clear high-interest debt;
  • reduce or repay your mortgage;
  • build an emergency fund; and
  • complete major home repairs while you still have a regular salary.

Every dollar needed for debt repayments is a dollar unavailable for your retirement lifestyle. If you expect to carry a mortgage, include it in your retirement budget and discuss your options with an adviser early.

Plan as a couple

Couples rarely retire on the same day. Discuss when each of you wants to finish work, how you will manage different NZ Super dates, the lifestyle you expect and how your combined income will work.

Understand what happens to each person's superannuation, insurance and assets if one partner dies. Both partners should know where accounts and important documents are held and how to access them.

With retirement getting closer, move from broad estimates to actual figures and decisions.

Build a realistic retirement budget

Use current spending as the starting point, then adjust for what will change. Work-related costs may reduce, while travel, leisure, rates, insurance and healthcare may take a larger share.

Test your plan against more than the first few years. Retirement may last 25 or 30 years, and spending patterns can change. Include inflation, emergencies and larger future costs. A plan that only works when nothing goes wrong is not a strong plan.

Try it yourself: Sorted's Budget Planner.

Decide how you want to wind down

Retirement does not have to be a cliff edge. Some members reduce hours, move into a less demanding role or undertake part-time or contract work.

Even one or two paid days a week can delay drawing on savings. Work may also provide routine, purpose and social contact, so think about what will replace these when you finish.

Review insurance before leaving

This is one of the most important and commonly missed steps. Cover that is straightforward while employed may be difficult or more expensive to replace later, particularly if medical underwriting or exclusions apply.

Review:

  • Police Health Plan: whether and how cover can continue, and whether you need to downgrade your policy;
  • Life and trauma insurance: review the cover you need to support your partner, repay debts or meet costs following a serious illness or death.
  • income protection: if you have this cover, review whether you still need it when your employment ends;
  • Home, contents, vehicle insurance and any time limits for converting or continuing existing products.

Do this while you are still employed, when your options are likely to be widest. Contact Member Services for information about your Association, Welfare Fund and insurance arrangements.

Put your affairs in order

If you don’t have a will, now is a good time to arrange one. If you do, check that it is up to date. Ensure you have enduring powers of attorney for both property and personal care and welfare, and review whether any family trust still serves its purpose.

Make arrangements for someone you trust to manage your online banking, email, subscriptions and other digital accounts if needed. Let your whānau know where to find important documents and information. The Police Association provides discounted estate-planning services via Perpetual Guardian.

Get advice before locking in decisions

A qualified financial adviser can test whether your plan works, structure your withdrawals and identify issues you may have overlooked. Advice is particularly important before making a GSF election, large withdrawal, major investment change, reverse mortgage, equity-release decision or retirement-village commitment.

Police Financial Planning provides further information about the financial planning support available to members. We also partner with Naked Finance, which offers members free financial advice.

The final year is about turning the plan into action and making sure nothing is lost in the move from salary to retirement income.

Confirm your retirement income

Put your expected income on one page:

  • NZ Super and its start date;
  • PSS or GSF payments or withdrawals;
  • KiwiSaver withdrawals;
  • income from savings and investments;
  • any employment, rental or other income; and
  • the tax treatment of each source.

Check that the timing works so there is no unexpected gap after your final salary.

Understand your final pay

Confirm what you will receive for annual leave, long-service leave and other entitlements. Ask how the timing of your final day affects tax, pay and superannuation contributions.

Decide what you will do with any lump sum before it arrives. Holding it in an accessible interest-bearing account while obtaining advice is better than rushing a decision.

Apply for NZ Super: it is not automatic

You can apply from 12 weeks before turning 65. If you apply before or on your 65th birthday, payments can begin from that birthday. If you apply later, they will generally begin from the application date, so do not leave it until the last minute.

Apply here:Work and Income NZ Super application

Once it is granted, check that you receive your SuperGold Card. If you may qualify for a Community Services Card, remember that you may need to apply or reapply for the combo card.

Set your drawdown plan and check your tax

You do not necessarily need to withdraw all your PSS or KiwiSaver savings on day one. Depending on the scheme, you may be able to leave money invested and arrange regular or occasional withdrawals.

Consider how much regular income you need, what must remain available for emergencies, how long the money may need to last, investment risk, fees, tax and whether leaving an inheritance matters to you.

Check your prescribed investor rate, or PIR, when your income changes. An unsuitable rate may result in too much or too little tax being paid.

Contact Member Services before leaving

Police Association membership ends when you leave New Zealand Police, but eligible members may be able to continue their Welfare Fund membership and associated products.

Contact Member Services one to two months before leaving so there is time to explain your options, update payment arrangements and avoid missed premiums. Ask about retired or associate membership eligibility, as leaving Police does not necessarily mean you have retired from all employment.

Prepare for the non-financial change

Leaving Police also means leaving a routine, identity and people with shared experiences. Plan what will provide structure, connection and purpose after your final day.

The Retired Police clubs offer a ready-made network of people who understand the transition.

Part Two: Once you have retired

After decades of accumulating savings, retirement requires a different skill: drawing them down to provide reliable income without running out too soon or unnecessarily restricting your more active years.

Choose a drawdown approach

Common approaches include:

  • 4% rule: begin by withdrawing around 4% of savings, with a focus on making funds last;
  • 6% rule: spend more earlier, accepting that the balance reduces faster;
  • life-expectancy approach: recalculate withdrawals using your remaining balance and expected lifespan; and
  • fixed-date approach: plan to use savings by a chosen age, then rely more heavily on lifelong income such as NZ Super.

These are guides, not guarantees. Your health, investment returns, other income, housing and wish to leave an estate all matter.

Sorted's Retirement Navigator lets you compare different approaches using your own figures.

Decide where your savings will sit

Options may include:

  • remaining with your KiwiSaver provider and making regular or one-off withdrawals;
  • PSS retained membership, if eligible;
  • term deposits or managed funds; and
  • specialist products providing income for a set period or for life.

Compare fees, flexibility, investment risk, access to lump sums and income certainty. Smart Investor can help compare KiwiSaver schemes and managed funds.

Keep an emergency fund

Retirement does not remove unexpected costs. Keep accessible money for healthcare, vehicles, home repairs and family emergencies.

Some people hold one to three years of planned withdrawals in lower-risk, accessible investments and leave longer-term money invested. The right structure depends on your circumstances and comfort with risk.

Review the first year

Compare what you actually spent with what you planned. Check whether your withdrawals, tax settings and investments still suit you. Small changes made early are easier than major changes later.

Retirement is not a one-time financial decision. Review your position at least annually and whenever something significant changes.

Consider whether:

  • regular income still covers your spending;
  • inflation has affected household costs;
  • investment risk remains appropriate;
  • major home or vehicle costs are approaching;
  • healthcare or support needs have changed;
  • your will and enduring powers of attorney remain current; and
  • your housing still suits your mobility, location and family needs.

NZ Super adjusts over time, but so do rates, insurance, food, power and healthcare costs. Keep enough flexibility to respond.

For many members, their home is worth more than every other asset combined. If savings do not stretch as far as expected, it may help support retirement. The options have very different consequences.

Downsizing or relocating

Selling and buying a less expensive property is generally the simplest way to release equity without interest or shared ownership.

Consider selling, legal and moving costs; whether a smaller property will genuinely reduce expenses; proximity to family, healthcare and transport; and whether the new home will still suit you later.

If considering a retirement village, understand the licence-to-occupy arrangement. You usually do not own the unit in the same way as an ordinary home, and fees, capital gains and exit payments work differently.

Independent information: Sorted's guide to housing options in retirement

Reverse mortgage

A reverse mortgage is a loan secured against your home. You remain the owner and regular repayments may not be required, but interest and fees are added to the balance. The debt is generally repaid when the property is sold, you move out permanently or you die.

Police Credit Union's Retire Easy product has age, property and lending requirements. Check current limits and protections directly with the provider, as terms can change.

Find out more: Police Credit Union Retire Easy

Home-equity sharing

An equity-sharing arrangement is not a conventional loan. In exchange for payments, the provider acquires an agreed ownership share in your home. There may be no mortgage interest, but the provider receives its portion of the property's value when sold, including any movement in value applying to that share.

Understand how much income you receive, what percentage you give up, fees, what happens when payments finish, your occupancy rights and the effect on your estate and whānau.

Example provider information: How Lifetime Home works

Important: Downsizing means moving. A reverse mortgage costs compounding interest. Equity sharing gives up part of your home's present and future value. Obtain independent legal and financial advice and involve your whānau before committing.

Retirees are frequently targeted because they may hold lump sums or investment savings. Former Police are not immune; scammers can be convincing and professional.

  • Be cautious of unsolicited investments, urgent payment requests or callers asking you to move money.
  • Hang up and call the organisation using the number on its official website.
  • Never share banking passwords, logins or security codes.
  • Check that an investment provider is regulated and is not on the Financial Markets Authority warning list.
  • Talk to someone you trust before acting. Urgency is one of a scammer's strongest tools.

For free and confidential help, contact Netsafe on 0508 638 723.