31 October, 2013

Young Ngāi Tahu save for retirement and wary of debt

 

ngai tahu picA Westpac/Massey University study of young people from Ngāi Tahu shows they are more likely to have their own retirement savings than others their own age and are also more wary of debt.

The study was carried out by Dr Claire Matthews and Dr Jeff Stangl on behalf of the Fin-Ed Centre (Financial Education and Research Centre – a joint venture between Massey and Westpac) as part of the Centre’s 20 year longitudinal study into the financial behaviours of 18-22 year olds.

Some key similarities between Ngāi Tahu and other young people were identified, including a reliance on parents for advice about money, a wariness of debt and less financial literacy compared to adults.

The report showed young Ngāi Tahu were more likely to have retirement savings other than Kiwisaver and were more likely to have attended school personal financial management classes, and to find these classes helpful.

“It is important to note that young Ngāi Tahu are aware of the Whai Rawa savings scheme available through Te Runanga o Ngāi Tahu, and have positive views about it.  In particular, many see Whai Rawa as likely to be a major contributor to their retirement savings,” says Dr Matthews.

Whai Rawa is an iwi-based savings scheme aimed at building the wealth of Ngāi Tahu Whānui by encouraging and assisting savings for home purchase, education and retirement. Whai Rawa Programme Manager Andrew Scott says,“It is great to see the findings of this study showing that our young people are aware of the iwi savings scheme. Whai Rawa is a vehicle for Ngāi Tahu distributions, and since it was established in 2006, over one third of the iwi has signed up.”

Westpac Managing Director of Private, Wealth and Insurance, Simon Power, says the results highlight the education and opportunities Ngāi Tahu is making for its young.

“It is great to see young Ngāi Tahu taking an interest in their own financial management and thinking about their long term retirement savings.  Ngāi Tahu should be congratulated for the commitment to saving for their young,” he says.

Meanwhile, the report also showed some other differences between young Ngāi Tahu and their peers.

Dr Matthews says the findings indicated that some young Ngāi Tahu were content to pay the minimum on their credit cards.

“Most 18 to 22 year olds do not have a lot of cash, so credit cards become an attractive option.  We can see from our research that young Ngāi Tahu, like other young people, do try to avoid credit cards where possible and are wary of credit card debt, however, preliminary results also show us that some young Ngāi Tahu are less likely to place importance on repaying their monthly accounts in full compared to others in the study.

Whai Rawa Programme Manager Andrew Scott says it is important to take the opportunity to learn about savings habits and to share this information to assist future generations. “We are always looking for new ways to assist our people improve their wellbeing.”

Dr Matthews says the report forms a valuable base-line on the tribe’s financial literacy and money habits of their young and will be incredibly useful for Ngāi Tahu in the long term.

The special cohort group will be re-interviewed every five years for the next 20 years, to discuss their financial habits.

Note:

The Fin-Ed Centre is a joint initiative between Massey and Westpac that aims to help New Zealanders become more financially empowered to achieve a better quality of life. The centre recently completed a baseline survey of around 300 New Zealanders aged 18-22 years to understand their levels of financial literacy. The longitudinal study will see the survey repeated with the same participants every five years for the next 20 years. A special cohort of 50 Ngāi Tahu students will also be followed over the same time frame to determine their views.

 For more information visit: Fin-Ed Ngai Tahu report