Today Bank of New Zealand (BNZ) shared findings from its second Wellbeing Index showing that Kiwis continue to enjoy relatively high levels of personal wellbeing despite concerns of a slowing global economy and its impact on New Zealand.
The value of the Index is essentially unchanged since the end of 2018 (67.2 this year compared to 68.4 in 2018) indicating that the wellbeing of New Zealanders has held up well over the past eight months.
The Wellbeing Index also revealed that:
- home ownership is linked to higher wellbeing
- Kiwis enjoyed higher wellbeing than incomes would suggest
- Kiwis were more upbeat than Aussies (despite lower average incomes)
- Kiwis had optimistic expectations for their income with 40% anticipating higher incomes over the coming 12 months compared to 13% that were expecting cuts
- New Zealanders rated “life-worth” as contributing the most to their overall wellbeing
- worries about money and finances are widespread and detract from wellbeing.
Paul Conway, BNZ economist, said, “Kiwis are generally a glass half full bunch and this is borne out in the research, with personal wellbeing comparatively unchanged despite talk of a slowing economy.”
“Interestingly, Kiwis tend to report higher wellbeing than our incomes would suggest, and the overall sense of “happiness” and “life satisfaction” in New Zealand is among the highest in the world.”
“However, it is certainly the case that having your finances under control and saving regularly is beneficial to personal wellbeing,” says Conway.
Financial hardship is all too common in New Zealand
Despite the relatively optimistic view on wellbeing, the findings show that too many Kiwis have insufficient savings to deal with emergencies and unexpected life issues.
More than a third of respondents reported being “extremely concerned” about their finances (35%) while around the same number experienced a specific incidence of financial hardship in the three months prior to the survey (36%).
Having insufficient wealth to fund a desirable life style in retirement was the biggest cause of ongoing financial stress among New Zealanders, with 60% of people believing they will have not quite, or nearly, enough savings for retirement.
Conway says, “Financial stress and hardship is still too prevalent in New Zealand and too many Kiwis are one unexpected event away from being thrust into difficult financial circumstances.”
“It’s not only those on lower incomes at risk of financial hardship. Although high incomes clearly help, around 25% of people living in households with incomes over $100,000 experienced some form of hardship over the past three months.”
“These findings reinforce the need for us to find sustainable ways of lifting incomes across more New Zealanders. Efforts to lift financial capability would also allow New Zealanders to make more of the wealth we do have. We should be able to deal with unexpected issues, and retirement should be something to look forward to rather than fear,” Conway says.