See the original Google Doc
Inspired by a US article claiming a poverty line of US$140k (NZ$240) gross income for a family with two kids (this is the poverty line not comfortable).
I'm interested in what this is in NZ assuming two income earners, two kids living in Onehunga.
The IRD has their own Household Expenditure Guide which you can compare to if you like.
Tenancy Services rental data for Auckland - Onehunga
I'm going to use rent as a convenient proxy for the total cost of home ownership (including maintenance, renovations and mortgage interest) especially since at the moment it is cheaper to rent. A 3 bedroom house in the lower quartile of rent in Auckland - Onehunga is $694/week.
Food: $100-150 per person so $400-600 per week for a family of four.
Based on "Study with New Zealand" recommendations for potential students.
Another source could be the Food Cost Survey from 2023 by University of Otago except this is already two years old. They also don't include any takeways at all. They estimate an Auckalnd family with two kids to be "Liberal" at $412 a week which seems quite low. I will take $500/week.
Initially I calculated this based on IRD vehicle kilometer rates for one car used the average kms per year so $315/week ($1.17 x 14,000km/year).
Comparing this to other sources like the IRD Household Expenditure and 2023 Census data I will adjust this downward to a more basic $250 per week.
This is for holiday programmes during school holidays (both are 5+).
NZ Annual Holidays - 4 weeks annual leave (20 days).
I'm only counting Monday-Friday since weekends you get off work anyway (typically), so therefore 5 days per school holiday week less any public holidays. Term 1 - 10 days less 3 public holidays so 7 days
Term 2 - 10 days
Term 3 - 10 days
Summer holidays = 6 weeks x 5 days = 30 days less 4 public holidays so 26 days
New Year's Day, Day after New Year's Day, Christmas Day, Boxing Day
So total of 7 + 10 + 10 + 26 = 53 days annual leave
Each has 20 days AL so 40 total. 53 - 40 = 13 days childcare
Auckland School Holiday Activities
Youthtown - $45 per child per full day - $90 per day for two kids
$90/day x 13 days required = $1,170 per year
$3,063.06 per year or $58.91/week.
Based on data from MBIE "Quarterly Survey of Domestic Electricity Prices"
Based on 22kW per day or 8,000kW per year at 38.25c/kW or $3,063.06 per year
$78.25/week
Based on Auckland Council latest average rates data.
$4,069 per year for average property
$25/week
RNZ article talking about most recent Auckland water rates rise
“From 1 July 2025, the price an average Auckland household pays for water and wastewater services would go up 7.2 percent or $7 a month.” so average must be $100/month
Based on a comparison on MoneyHub 300 mbps is $90 per month. You can get this down to about $60 per month for the most basic plan but this might not be enough for a family of four.
Again, based on a MoneyHhub comparison of mobile plans Warehouse mobile $15 combo, just the parents need one each so $30 per 28 days = 13 months or $390 annually = $7.50 per week
Based on a MoneyHub comparison of home contents insurance this is $400 to $600 per year for $25,000 of total cover. I'll take the middle number of $500.
Based on a MoneyHub comparison of life insurances
“30-year-olds: Around $400 annually for $500,000 cover” Sounds like it's usually just on one person's income (higher earner).
Because more often than not when creating hypothetical budgets you underestimate your actual costs I'm going to add a blanket $100 a week as a margin of error.
See the Google sheets for full calculation of my New Zealand Poverty Line.
My sheet estimates ~$92k per year of household expenses. If I round this up to $100k, under the most tax efficient situation where both earners are earning the same to achieve this after tax income they both need $50k after tax. I will assume they at least take the minimum 3% employer KiwiSaver match.
That is $63,830.56 before tax per earner or $127,661.12 total household income.
See InfoMetrics median household income data
Compared to median household income in Auckland of $166k or $39k before tax more than the poverty line. Again, in the most tax efficient situation the household income is halved so $83,000 each or $61,856.40 after tax and KS. This is $11k per earner above the poverty line or $22k per household of savings/holiday money.
For comparison the median household income in NZ is only $135k or $8k above the poverty line.
If we assume there is only one income earner the numbers work out like this:
To achieve the $100k poverty line: $144,196.23
On $166k (median household income Auckland): $113,810.91 after tax (or $13k above poverty line)
See the rules around family tax credits
Eldest child: $7,524
Every other child: $6,130
Total: $13,654
“We work out the abatement by starting with your family income, subtracting $42,700, then multiplying the difference by 27%. Your entitlement for the year will be your full family tax credit less the abatement.”
$13,654/27% = $50,570.37 + $42,700 = $93,270.37 max income (no tax credit)
This is below my calculated poverty line of $127k-$144k
I don't think you'll get any other benefits based on that income.
Interestingly, the max income where you get no benefits from Family Tax Credits lines up quite nicely with my estimate of the New Zealand poverty line.
So on the whole, this simple analysis shows that it is indeed incredibly expensive to live in New Zealand relative to the wages you receive.
It shows that in Auckland you need a household income of 76% of the median in Auckland or almost 100% of the national median household income to not be in poverty. That means across the country something like 50% of our households are realistically in poverty.
This also assumes you have only two kids and that there is no extra money for savings or holidays or birthdays or any other random expenses. It is quite a bleak picture. Especially when you compare that to the good 'ol days when just one income earner was enough to afford not only a poverty lifestyle but a comfortable one which included home ownership.
Today to just reach the poverty line on one income that is $144k gross income. Notable is that even though a big percentage of our population seems to be below or near the povery line we don't have very high childcare or healthcare costs which were really the two big killers in the US. In New Zealand that seems to be Housing and Food (and our petrol is at least 2x as expensive as the US).