Time and again, gender disparity has been a topic of conversation and more often, the gender pay gap has played a vital role. Research has shown that men and women don’t work on equal footing and therefore when it comes to retirement plans, women fall a lot behind men due to their fewer work years and pay disparity than men.
According to a recent study by Nationwide Advisory Solutions, only about 6 in 10 women have their retirement plans sorted whereas, in the case of men, it’s more than 3 out of 4. Although women outlive men, according to the World Health Organization, women tend to be less prepared for retirement than men.
Why so? Let’s find out.
- Negative stereotypes
There are a few negative stereotypes that exist with regards to women being poor planners. This is one of the reasons why retirement for women is often linked with their partner’s retirement plans. Some leave the decisions to their partners while some leave the planning mid-way.
- Higher Health Costs
Women tend to spend more on healthcare when compared with men. However, this is also subject to lifestyle choices such as smoking, sedentary lifestyle, and others.
Retirement for women also sets back due to them being considered as the sole caretakers of the household. Often women tend to leave work to bring up children or care for other family members. On average, they spend over seven years out of the office to take care of their family members.
Now that we know the causes of women being less prepared for retirement than men, here are a few ways to build a stronger retirement plan.
- Be vocal about your numbers
Pay disparity between men and women has been there for a long time. Therefore, when negotiating your salary, ensure you base your salary on your needs, including savings, retirement plans, and others.
- Find a financial advisor
Find a good financial advisor whom you can trust and who has the ability to understand your financial goals and needs. Discuss your long-term goals after retirement. However, do your own research too.
- Start now
Even though retirement for women looks like a far-fetched idea, start as early as possible. This could be small numbers initially and later increased as and when the income grows.
- Educate yourself
It is important to know about the different types of investment and the risk and returns associated with each of them. This will further help you in building a stronger retirement plan.
- Speak to your employer
Obtain all the information from your employer about any existing retirement-based investment schemes and actively participate in any plans offered.
It is better to start now than to feel sorry later. Following the above steps can make retirement for women more stress-free and independent.Click here to visit our Retirement Planning Calculator
The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.
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