The retirement gender gap

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Women are more vulnerable going into retirement than men are, and they know it. There is a startling gender gap in women’s preparation for retirement versus men. To make matters worse, there is an astonishing lack of knowledge about spouses’s incomes, debts or retirement finances.

Interactive Investor did a large study of the attitudes and experiences of Brits going into retirement. According to Moira O’Neil, Head of Personal Finance, the survey offers “a more nuanced picture of retirement (and the run up to it).”

Nuanced it may be but it also exposed a considerable gender gap between the expectations, actions and savings of men versus women in the golden years. Women are twice as likely to work during their retirement from need, whereas retired men are twice as likely to work for pleasure. Women are more likely to think their relationship with their husband will worsen during retirement (6% of women versus 4% of men), although 34% of couples think their relationship will improve and 57% think it will remain unchanged.

Money management is a chore

More than double the number of women than men (34% to 15%) find financial planning and money management a chore and almost half the number of women say it gives them satisfaction compared to men (21% and 40%). One of the problems for women is just finding the time to get to the money management, with 19% saying they don’t have the time versus 9% of men.

Up to 30% of women spend less than thirty minutes a month on their finances, whereas almost the same percentile of men (29%) spends six hours a month. In comparison, only 12% of women spend as much time as that. With retirement, unsurprisingly, virtually all have enough time.

Knowledge is power

Knowledge about a spouse’s finances also varies between the genders. While 69% are confident that they know their partner’s financial position, women have more exact knowledge of their partner’s income than men have (72% versus 67%). However, more men know the detail of the partner’s savings and investments (80% versus 74%).

There is effective parity on the knowledge that each gender has of the other’s debts but it’s astonishingly high (52% for men and 51% for women). And both genders claim to be honest about their finances, although women admit to lying more about the price of things they’d bought (11% versus 4%).

The gender gap around retirement spills into self-belief. Men are more confident than women (79% versus 56%) that they have the skills to manage their own finances. Women also have more regret than men do about not saving more (36% versus 28%) and a third of women have no idea what their income will be in retirement whereas 19% of men lack that knowledge.

Financial hardship

This gap between the genders’ knowledge and expectations then means almost a third of men (30%) are very confident they’ll maintain their quality of life once they retire, compared to 17% of women. A substantially higher percentile of women than men think that they will have to make major adjustments to their lifestyle in order to maintain their standard of living once they retire (37% versus 18), with, sadly, 13% of women and 7% of men expecting their lifestyle will worsen with retirement. And for those who have already retired, women are twice as likely as men to say that they’re just getting by financially.

As Moira O’Neill says, “The inescapable truth is that many women are facing a retirement of financial hardship which is having a real and lasting impact on their quality of life… It is women in particular who are more likely to be left with just the crumbs.”

Interactive Investor makes some recommendations to assist women in having better money management skills and saving for the future. First, it suggests a state-led education campaign aimed specifically at women to help foment a change of attitude and cultivate a savings and investment culture.

Second, it suggests getting auto-enrolment to work better, lowering the minimum age to 18 as soon as possible. It saw no reason to wait until the mid 2020s to make these policy changes, as government policy now stands.

Finally, as more women juggle several part-time jobs than men, widen the £10,000 earnings threshold for auto-enrolment to reflect that reality.

It’s never too late to save and reduce your chances of financial hardship in retirement. Click here to run our DIY investment calculator , or if you prefer someone to manage your money for you, click here to find a robo-adviser.


Photo by Christian Bowen on Unsplash