Questions about attitudes and behaviours in the 2009 ANZ-Retirement Commission Financial Knowledge Survey tested what New Zealanders think about money, and what they do.
In this section:
- How do people plan and manage their money?
- Where do people get financial advice and information?
- What financial products do people have and use?
- How do people feel about their finances?
About one in six New Zealanders (16%) think they have difficulty managing their money. This is higher amongst those with a low knowledge level (26%).
Of those who think they have difficulty, 37% say their greatest difficulty is that they do not have enough money, while 29% say their greatest difficulty is a lack of self-control in regard to spending and budgeting. A different question was asked in the previous survey so results are not comparable.
How do people plan and manage their money?
Fewer people have financial goals (down five points to 75%) while only one in five have a written financial plan (no significant change).
Two in three people (64%, no significant change) have a budget – more in the high knowledge group (70%) than in the low knowledge group (56%).
Around four in 10 (39%, unchanged) say they keep a fairly close eye on expenses without keeping a written record, while 34% (no significant change) keep written or electronic records. More people are keeping an eye on their expenses ‘a bit’ (up five points to 22%). There is still a small number (5%) who do not keep an eye on expenses at all.
Just over half (56%) say they think about financial planning for retirement ‘a lot’ or ‘a fair amount’ (no significant change); again this is more common among the high knowledge group (70%) than the low knowledge group (38%). As in the previous survey, people give more thought to financial planning for retirement as they get older.
Around half are saving money on a regular basis and about one in five save ‘sometimes’ (no significant change). About a third (29%) are members of KiwiSaver; this is more common among the high knowledge group (36%) and less common among the low knowledge group (17%).
Where do people get financial advice and information?
Banks are the main source of financial advice (51%) used by people in the last 12 months, followed by friends and relatives (35%). More have taken financial information or advice from a TV programme (21%) than from a financial advisor (18%). This question was not asked in the previous survey.
One in five (21%) have not received any financial advice or information.
People in the low knowledge group are more likely than other knowledge groups to turn to friends and relatives (40%). Banks are still the main source of financial advice for the low knowledge group (43%).
One in three of all respondents (34%) have used the Retirement Commission’s Sorted resources, and one in four (24%) have done so in the last 12 months.
What financial products do people have and use?
Use of internet banking has increased to almost one in two (47%), up from one in three (34%) in the previous survey. The move to internet banking has led to a drop in the use of all other payment methods other than EFTPOS.
Two-thirds have a credit card and 68% pay it off in full each month (no significant change).
There is a drop in the number of people with vehicle insurance (down five points to 73%) and house/contents insurance (down six points to 69%). This is particularly the case in the low knowledge group, where the proportion with vehicle insurance is down 14 points to 47% and house insurance is down 12 points to 42%.
How do people feel about their finances?
When asked to agree or disagree with a number of statements, those with less knowledge are more likely to say they feel out of control with their borrowing and debt, less confident about managing their financial affairs, not able to cope with a major loss of income and find it hard to make ends meet.
In contrast, those with advanced knowledge are much more likely to say they are in control of their borrowing, plan for the future and know what insurance they need to cover their needs.
About half of the statements were worded differently to the previous survey. Where the wording was the same, the results indicate that people are now feeling more financially uncertain and vulnerable.
Fewer feel confident about managing their financial affairs (down eight points to 75%); fewer believe they are personally responsible for their financial future (down four points to 88%); fewer feel that if they had a major loss of income they could manage for three months (down five points to 57%); and fewer have worked out how much they need for their retirement (down nine points to 26%).
