How to manage your retirement investments after 65

It seems like 65 is the new 45. The way we work today and our attitudes to retirement have changed dramatically compared to our parents’ and grandparents’ generations. Retiring is rarely the milestone it used to be.

Here we explore how your investment strategy may change after 65, the role KiwiSaver plays once you can access it and we explain the concept of gradual ‘decumulation’ of assets to keep you in the lifestyle to which you are accustomed!


In this page we consider:


As at any other time in your life, an investment strategy that’s right for you depends on your goals, your timeframe and your level of comfort with risk.


How your investment strategy can change after 65

Life pre and post the ‘official’ retirement age of 65 is now shades of grey rather than black and white. Today many people continue to work well into their retirement. And with health and income on your side, life beyond 65 is full of options. But what impact does all this have on your retirement investments? 

In the lead up to retirement, most people are looking for ways to build wealth - whether that be through a nest egg of savings, managed investments, property, or even commercial assets - the point being that these things can provide you with ongoing income long after you’ve hung up your (work) boots.

When it comes to investing in financial markets, it’s important to review your investment strategy regularly, both in the lead up to retirement, and during retirement. Depending on your level of comfort with risk and what your overall investment portfolio comprises, you may want to consider altering investments as you get closer to the time when you’re going to want to access that income.

During retirement, your investments should look after you in three different ways:
  1. Short-term
    Some investments should provide liquidity - money to live on for a couple of years, and extra cash that you can access quickly if needed.
  2. Medium-term
    Some investments should provide income. Income-providing investments such as bonds and stocks produce regular payments to supplement other income.
  3. Long-term
    These investments should continue to grow and beat inflation. You could consider diversified growth investments, that could experience short term losses, but target higher returns in the long run.

Many people assume that the closer you are to retirement the more you should ‘de-risk’ your portfolio. However, depending on your situation, ‘risk optimisation’ may be another option to consider to ensure you achieve your retirement income goals. Which is why a diversified portfolio of investments can provide a balance of income, growth and higher returns to achieve your investment objectives.

Read more about optimising risk and diversification here.

Learn more about the risks of investing and how to manage them.

The role of KiwiSaver in retirement

What many people don’t realise is that as a KiwiSaver investor, you have the ability to select exactly what funds your KiwiSaver balance is invested in.


The role of KiwiSaver in retirement

Once you reach 65, you can access all your KiwiSaver that you have been building up over your working life....but should you?

Before we explore this, let’s look at what happens when you turn 65:

  • KiwiSaver suddenly becomes more flexible – you can choose to withdraw some or all your money, and/or make whatever contributions suit you.
  • You can receive NZ Super from age 65, even if you’re still working.
  • Once you qualify for NZ Super, you’ll no longer get the KiwiSaver government contribution, even if you continue to contribute.
  • If you're still working after 65, your employer can choose to stop making their own contributions to your KiwiSaver.

So KiwiSaver doesn’t just come to an end at 65. You don’t suddenly need to draw down your entire  balance and put it somewhere else. In fact, as KiwiSaver providers are obliged to set ‘reasonable’ fees, KiwiSaver is a cost-effective way to continue with your retirement investment. And with the right structure of funds within your KiwiSaver, you have the flexibility to draw down your money, as and when you need it, so you can keep your investments working.

Try our GoalsGetter online investment platform to see how you can tailor your  investment in Kiwisaver with Nikko AM.

See how your KiwiSaver can grow with GoalsGetter.




Decumulation refers to the period in life when you shift from accumulating assets to relying on savings, investments and other retirement tools to provide you with income.


The concept of decumulation

Our working lives are all about accumulating wealth in preparation for the time when we retire and we need that wealth to live on.

As people are living longer, retirements are extended and we could end up being retired for longer than our working lives.


A financial rule of thumb says retired people spend in an average week about 75% of what they spent before retirement. However, retirement now lasts long enough to be divided into multiple stages and spending differs a lot between each phase. You may also want to consider your 'legacy'. Do you want to leave anything behind for your whanau?

There are three stages of retirement most people typically experience:


Your ‘doing’ years.
Discovery retirement is the early days of retirement, commonly associated with ‘SKI holidays’ (spending the kids inheritance!). As an active retiree with (usually) the benefit of good health, you’ll do more (and spend more) than the other retirement phases.


You’re still ‘doing’ but are slowing down.
Things typically calm down a bit in the restricted phase, as you tick off the bucket-list and ease into a more relaxing mode. Sometimes creeping age and health considerations can impact your lifestyle, so during this phase your spending changes again.


You’ve done what you wanted to do. It’s time to kick back.
With luck on your side it’s time to really relax. During this stage your expenses typically reduce as you enjoy the simpler things in life. Your budget will depend on your healthcare needs and living expenses (for example, moving into aged-care facilities).

So what impact does this have your investment strategy before and during retirement? Pre retirement, when you’re in ‘accumulation mode’, investing is straight forward – your goal is to get maximum returns on all your investments and the focus is on acquiring assets.

When you’re ready to retire and start drawing down on your investments, a new strategy is required - commonly known as decumulation.

Decumulation investing, for the purpose of funding retirement income, is more complex than simply accumulating assets. As you’ll be needing a regular income from your investments, this impacts your investment choices. You’ll need to be investing in assets that can feed your income stream. A decumulation strategy therefore needs to consider which assets it needs to sell to fund the income you require, and which need to be kept to maintain value.

It’s really important to get good advice from an investment adviser or fund manager to ensure your investment portfolio is structured appropriately to support your retirement income requirements. For this advice, get in touch with an Financial Advice Provider. In the meantime, tools such as GoalsGetter provide you with the ability to monitor and adjust your investments over time, as your needs change.

In summary

Your retirement is exactly that. YOUR retirement. What income you can draw on during retirement depends on the assets you’ve accumulated pre-retirement, and how well you structure your investments during retirement. The most important thing to take away from this page is that investing doesn’t come to an abrupt halt at the age of 65. Instead, at this time, more than ever, it’s important to manage your investments closely to ensure they’re structured to provide the right income you need to lead the retirement lifestyle you desire. Go get it!

See what your retirement income could look like. Use our GoalsGetter retirement calculator to find out.

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