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Women Have a Tougher Time than Men When it Comes to Money


This article has been submitted by Magenta Financial Planning

On the third anniversary of the introduction of Pension Freedoms, Zurich UK has launched new data showing that women in pension drawdown face a 37% shortfall in their annual retirement income compared to men, leaving them more than £47,000 worse off.

Our experience shows that women can often have a tougher time than men when it comes to money. That’s not because women are bigger spenders than men or that they simply aren’t interested in building wealth and investing.

The truth is, there are real structural roadblocks to attaining financial freedom for women compared to their male counterparts and they have to work harder to overcome these. The good news is that we have seen a 30% increase over the last year, in enquires from women who believe it is high time they got on top of their money, to secure their future desired lifestyle.

In many cases these have been women who find themselves facing divorce or separation from long term partners and who need some emotional support as well as financial guidance.

Here are some of the obstacles and issues we have identified:

  1. We’re all familiar with the gender pay gap statistics – having less money will clearly have an effect on a woman’s ability to invest and build personal wealth. This is something that society should be working on.
  2. Career breaks and maternity leave have always had a long-term impact for many women and their ability to gain promotions and access to greater salaries and benefits. Hopefully the introduction of more flexible paternity leave will have a levelling effect.
  3. Many women have personally experienced negative stereotypes about their investing know-how and financial contributions to the household. Many report being “patronised by men in suits” and feel uncomfortable about challenging dogmatic ideas even when they make no sense.
  4. Then there’s gender price discrimination known as a “the pink tax” – meaning women pay more for “female” versions of products. This is especially true for children’s clothes apparently.
  5. Many women have delegated all things financial to male partners, believing themselves not interested or not capable of dealing with such “complex issues.” But all women are interested in a secure and happy future and not all men are good at managing the finances (whatever they may say!) so it is imperative that women start to take responsibility for their future finances.
  6. Women still have a longer life expectancy than men but if they are not engaged with their financial planning, then they are at risk of making poorer decisions that could result in a lower income in later life, or even outliving their savings.

The good news

In our experience, once women are engaged in their financial planning with a trusted adviser; with a clear view of their financial future and have confidence in their decisions, there is no reason why all their financial dreams and desired future lifestyle cannot be achieved.

If you are currently looking for advice and any of the above resonates with you, take a look at the Magenta website or give us a call.