Women need bigger pensions

YET FEW CONSIDER THIS IN PLANNING FOR RETIREMENT Across all age groups, women have a significantly lower level of income in retirement than their male counterparts.

The average SA woman works longer hours than the average male counterpart, but women are far more likely to face financial peril in retirement. Despite this, and while having a good record of being successful investors, many women don’t prioritise saving.

For many women, their daily reality is just surviving now, while juggling parenthood and work responsibilities. Women work on average 50 minutes more a day than men, according to the World Economic Forum’s Global Gender Gap report.

Despite this, a recent US National Institute on Retirement Security (NIRS) report shows that across all age groups, women have a significantly lower level of income in retirement than their male counterparts.

Women between 75 and 79 were three times as likely to fall into poverty as their male counterparts. For women 65 and older, their typical incomes were 25% lower than those of men. The gap widened as they aged.

SA women in general outlive their male counterparts by four years. They must rely longer on their retirement savings, but only 34% consider their longevity when planning for retirement.

In general they are also much less aware of their retirement saving plans than men.*

Time and the power of compounding are your investment allies. Even R500 invested monthly, increasing each year by inflation for 25 years, becomes R1 351 992, assuming reasonable long-term average returns.

Several studies show women are better investors than men. It starts with willingness to have a plan, being risk averse but not overcautious, accepting advice – and adding common sense along the way. SA women show an increasing appetite for investing in stock market-related products such as exchange-traded funds and shares. Data from one of SA’s largest banks* shows a five-fold growth in share investments by female investors over the eight years to 2016. At whatever age, take a portion of your income, or windfalls, and invest them. If you haven’t got 25 years, it’s a lot better to start now than doing nothing. Have an emergency investment. The lack of an emergency fund is a main reason many women end up heavily

Become proactive and look after your future.

indebted.

You can’t rely on partners, husbands, governments and others to look after you and invest for your future. It isn’t going to get easier as you get older. Become proactive and look after your future – the sooner the better. A good financial advisor can also help you.

*FNB Share Investing; Old Mutual Savings and Investment Monitor 2017; 2015 & 2017 Sanlam Benchmark Survey.