News
6 July 2021

Women missing out on $750 million in retirement

 

Want more money in retirement ladies? Then its time to start learning a bit more about investing, according to a new report out from ASB bank.

Created in conjunction with the University of Melbourne’s Institute of Applied Economic and Social Research, the report finds that on a day-to-day basis the average Kiwi woman is better off than men by about two percent. That’s because they save more, despite earning nine percent less on average. Men, it seems, spend about eight percent more than women. Women are more likely to have a savings account and typically hold $600 more in savings. Fewer women than men live payday to payday, miss payments or fall into unarranged debt

Yet all this gets tipped on its head when it comes to retirement savings. ASB drew on financial data from more than half a million of its personal banking customers and analysed its ASB KiwiSaver Scheme for the report, which finds women’s KiwiSaver pension pots are about 12 percent smaller than men when they start withdrawing the money. It suggests this is due to women earning less and taking more time out from paid work for family commitments, which ultimately hits their retirement savings. But there is another significant factor too - women are not capitalising on their savings as well in the long term, it says.

ASB argues that if the additional savings women have over men were invested in a suitable KiwiSaver fund, women aged between 35 and 65 could boost their retirement funds by a collective $750 million.

“ASB’s independent Investor Confidence and KiwiSaver surveys tell us women rate their knowledge of investing far lower than men and are more likely to be in the most risk-averse KiwiSaver funds, regardless of their personal circumstances or goals, which can mean they’re missing out on investment gains over time,” ASB chief executive officer Vittoria Shortt says.

She says the study makes it clear that what we do with our money has a bigger impact on financial wellbeing than just income alone.

“Setting aside money for tough times is the most important thing Kiwis can do to improve their immediate financial wellbeing, but longer-term planning is vital too,” she says.

So how can women get the confidence to invest a little more bravely?

Knowledge can help grow confidence and there are an increasingly number of resources springing up to help women in this area. Here are a few to get started with.

Websites and workshops:

The Curve: An investing education platform for women.

Closingthegap.co.nz: Aimed at closing the gender investment gap and providing tips and tricks for making your money work for you.

Places like the Financial Markets Authority and the Retirement Commission’s Sorted website are also great places to learn the basics of investing and saving for retirement.

Podcasts:

Mary Holm’s Radio New Zealand podcast Your Money provides tips on how to make your money work harder.  You can also visit her website to find out more about the popular books she has written on money.

Journalist Frances Cook presents Cooking the Books podcast, which tackles a different money problem each episode. 

 

And if you’re experiencing ‘economic harm’ described as behaviour towards a person that controls, restricts or removes their access to money, economic resources or participation in financial decisions, then Good Sheppard may be able to help.

 

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