It’s worth asking yourself if you could survive spending $127 a week on groceries. 

Some people do. 

But, every time I go to the supermarket – even a small basket costs $100+

How are these numbers calculated?

People often ask: “how does Massey calculate them numbers?”

Here’s what Massey Uni does. They go to Stats NZ and get data about what retirees actually spend each year. 

The No Frills lifestyle represents retired people who spend below average. 

Imagine a lineup of 100 people. The lowest spenders are on the left, and the highest spenders are on the right. 

People on the No Frills lifestyle would be about position 30. 

So, 30% of people spend less than the No Frills lifestyle. And about 70% of people spend more than the No Frills lifestyle.

The Choices lifestyle is the exact opposite. It’s an above-average lifestyle.

In that same lineup, the Choices lifestyle would be in position 70 out of 100 people. 

So, 70% of retirees spend less than the Choices lifestyle, and about 30% of people spend more than the Choices lifestyle.

There’s a bit more number crunching than that. But that’s the easiest way to think about it. 

"Don’t these numbers seem a bit low?"

I got an email last week from Paula, asking, “Aren’t these numbers a bit low?” 

She showed me her retirement budget. She reckons she’ll need $170k a year to maintain her current lifestyle. 

This brings up an important point. The No Frills and Choices lifestyles aren’t what you SHOULD spend.

They aren’t example budgets showing what you ‘could’ spend in retirement either. 

Massey aren’t going to the shops to decide what’s essential (or not) for retirees.

Instead, these numbers show what some people DO spend. 

Paula’s income is high. She’s in the top 5-10% of households when it comes to income. 

That’s because she and her husband both work white-collar jobs in the city. 

They have more money, so they spend more. Nothing wrong with that.

So, it makes sense that the Choices lifestyle seems a bit low to her. Because the Choices lifestyle is a ‘top 30%’ of retirees' lifestyles. 

Meanwhile, Paula and her husband are among the top 5 – 10% of earners. 

That’s not to say that Paula should spend less. It’s just that the Retirement Expenditure Guidelines are, well, guidelines. 

Think of it as a ballpark rather than a budget. 

How do I figure out what I should spend?

It’s hard for people to figure out what they’ll spend in retirement. So I built this calculator.

It figures out how much you currently spend each year. 

It takes out the things you won’t spend on in retirement (like saving, childcare and your mortgage) and adds on things like travel. 

That way, you can create your own ‘retirement expenditure guideline’ for the money you might need.