Are you a woman planning for retirement? Then this handy guide is for you.

According to data, Kiwi women are lagging behind in retirement planning. Often time-poor, lower-paid and more risk-averse than men, on average women don’t accumulate as much in retirement savings as men do. The good news is, with the help of a SHARE adviser, you can create sustainable security for your lifestyle.

Here are some factors that can impact on your savings potential – making quality financial planning all the more crucial.

Women tend to live longer than men

In line with most developed countries, New Zealand women generally live longer than men: their average life expectancy is 83 years compared to 79.5 (Source: Stats NZ 2012-14). Sixty-one per cent of the 75-84 age group is female, and in the over-85 age group, there are more than twice as many women as men.

This puts additional pressure on retirement planning, as the longer women have in retirement, the more they need to save.

The goal of any successful retirement plan is to build a nest egg big enough to last your retired lifetime, to avoid running out of money when you need it most. And that’s where a long-term investment plan can make all the difference – one that’s designed to achieve a balance between risk and returns.

Women tend to be more risk-averse than men

Investment always comes with some risk, and generally speaking, the higher the risk, the more likely investors are to achieve positive returns over time.

However, research has consistently shown that women tend to be more conservative investors than men and review their investment strategy less frequently, potentially missing out on bigger nest eggs down the line.

What’s more, the Commission for Financial Capability recently found that only 33 per cent of Kiwi women know how much they need to save for a comfortable retirement, compared to 44 per cent of men. And amongst those who do know, only 44 per cent of women surveyed say they’re on track, compared to 64 per cent of men.

Remember, investing can be a powerful tool to create a comfortable future for you and your family. Your goals, your investment horizon, and your risk profile – these are all important components of a sound retirement plan. At SHARE, we are here to help you design a tailored plan, aligned with your objectives.

Women tend to earn less than men

While here the gender pay gap has reduced over the years, placing New Zealand among the 10 most gender-equal countries in the world (Source: World Economic Forum, 2020), there’s still some work to be done.

In 2020, Stats NZ announced that the gender pay gap was 9.5 per cent. According to the Ministry of Women, this could be due to a mix of differences in education, occupation, and the fact that women are more likely to work part-time. But most factors remain ‘unexplained’ or difficult to track, including conscious and unconscious biases that impact on women’s pay advancement.

Whatever the underlying factors might be, lower-paid employment has an impact on the amount that women can save for retirement. Once again, having a financial plan can help close the gap, keeping in mind that even small amounts are likely to add up over time if saved or invested regularly.

The gender knowledge gap

The Commission for Financial Capability recently conducted a financial literacy survey, finding that New Zealand women score lower on financial literacy than men, with the gap widening with age.

Plus, as NZ Retirement Commissioner Jane Wrightson pointed out, women tend to have a disconnect between not valuing the money per se and appreciating what money can achieve for them. “They rate making money lower than caring for others, yet it is money that will enable them to look after their children and wider whanau,” Wrightson said.

How financial topics are treated by media and advertising may have something to do with all this. A UK study, for example, found that 73 per cent of money articles aimed at men focused on investing, and 70 per cent emphasised that making money is a masculine ideal. On the other hand, 65 per cent of money articles in women’s magazines defined women as ‘excessive spenders’, and 90 per cent were about the need to spend less.

Cultural disadvantages and emotional differences aside, financial literacy and confidence are crucial to create long-lasting security and a sustainable cash flow. When planning for the future, the key thing is to start now.

Get in touch

At SHARE, we specialise in helping Kiwis from all walks for life embark on a positive financial journey. Please don’t hesitate to contact us if you’d like to discuss your needs and goals. We’re here for your questions. Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current development or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.