One of the reasons given for needing to increase the age of eligibility for New Zealand’s universal superannuation is the baby boomer bubble that is will raise the number of people who qualify substantially.
Another factor is life expectancy – with more of us living longer that lengthens the time we are paid Super.
Here are life expectancy trends from Statistics New Zealand:
This is god for showing improved life expectancy trends, but I have always been unclear what this means for someone born in the 1950-60s. Perhaps we had a higher chance of dying young than babies born now.
This trend gives a better idea of what our expectations are now (subject to life’s lotto):
In 1977 the Muldoon introduced universal superannuation for everyone from 60 years old.
Then average life expectancy for a man was about 65+13 years (18 years of pension), and for a woman it was about 65+17 (22 years of pension).
The age of eligibility was raise to 61 in 1992 and gradually rose to 65 in 2001.
In 2001 average life expectancy for a man was about 65+17 years (17 years of pension), and for a woman it was about 65+20 (20 years of pension).
In 2013-15 average life expectancy for a man was about 65+20 years (20 years of pension), and for a woman it was about 65+23 (23 years of pension).
So people are on pensions on average about three years longer than at the start of the century. And life expectancy is predicted to keep improving so this will keep growing – unless the age of eligibility is increased.