New Zealand’s finance minister, Michael Cullen, has warned New Zealanders not to rely on the value of their houses to provide a retirement nest egg. (The average New Zealand household currently has 70 percent of its wealth tied up in the value of the family home.)

Dr Cullen said, “your house should not be relied upon to replace other saving. Many people plan to downsize the family home once retired, believing this will free up enough capital to generate additional income.”

A new report from New Zealand’s treasury says, however, that the effect of New Zealanders selling their home in retirement is ‘modest; it is only noticeable when households halve the size of their home’.

Dr. Cullen is currently publicising KiwiSaver, a government backed scheme to enhance New Zealander’s finances in retirement. People can choose to save 4 percent or 8 percent of their pay in the scheme. Employers can contribute tax free to employees’ savings up to 2 percent of pay. When people first join Kiwisaver they receive $1,000 tax-free from the government.