Women risk financial insecurity in later life due to a culmination of societal, health and financial factors stacked against them, according to a report from Insuring Women’s Futures.
Women today are living longer, are better educated and have greater access to career opportunities, but with earnings forming the basis for pension saving, the gender pay gap is a major contributor to women’s pension deficit. The average pension wealth of women aged 65 is £35,800 – just 1/5th of men the same age, a mere fraction of their financial needs in retirement irrespective of their end of life care costs – on average £132,000 for a 65-year-old woman entering a care home in the UK.
The Insuring Women’s Futures Market Task Force will take steps to address some of the root causes of the 12 financial ‘Perils and Pitfalls’ that impact women’s financial resilience through life and culminate in an enduring women’s pension deficit, for example: young women’s financial capability; the motherhood penalty and part time working; and improving how the insurance and personal finance profession serves women in their Moments that Matter.
Sian Fisher, CEO of the CII and Chair of the Insuring Women’s Futures committee, said: “Women’s lives and freedoms have changed for the better, yet society’s expectations of women have not. The serious financial disadvantage women face in old age cannot be attributed to any one factor but is a combination of societal, health and financial factors stacked against them. Women are living longer, however, care costs them more at the end of their lives. Women are succeeding in the workplace and the gender pay gap is hopefully closing but caring for family, even for just a few short years, significantly impacts a woman at retirement. It is the culmination of all these factors that is potentially driving women towards to poverty in old age.
“By 2020, 12 million people will be above the State Pension Age and, of these, there will be a million more women than men. Insurance and financial planning have a central role in supporting people to manage their financial risks in life. The findings in this report show there is much to be done to improve women’s pensions and financial resilience generally. In conjunction with our Market Task Force Manifesto, Insuring Women’s Futures calls upon government policymakers, regulators, the legal, insurance and personal finance and wider financial services profession to unite with society to realise positive change to create a sustainable retirement for all.”
Insuring Women’s Futures is an initiative established by the Chartered Insurance Institute (CII) as part of the its ‘Insuring Futures’ programme, bringing together the insurance and personal finance profession to tackle the challenges that women face when it comes to establishing financial stability. The Insuring Women’s Futures Market Task Force is made up of senior leaders from across the insurance and personal finance profession, who are joining forces to improve women’s resilience to risk, as part of the Insuring Women’s Futures programme.
The report can be downloaded at: www.insuringwomensfutures.co.uk/