56% of woman haven’t started saving for the future, research conducted by YouGov has recently shown.
The study, commissioned by Scalable Capital as part of their Women’s Initiative, also suggested that 44% of men and women in the UK are concerned about not having enough money for a comfortable retirement.
Are women the only ones who aren’t saving?
Whilst the survey was intended to research the ways in which British and German women are, or are not saving for their retirement, it also gave an insight into the savings habits of men:
- It showed that 49% of men are in a similar boat, and not saving for retirement
- 47% stated that they had started saving
- 4% don’t know
Why are so many ill-prepared for the future?
Put simply, the two main barriers were shown to be a perceived lack of financial knowledge, and a fear of unexpected losses. The study showed a distinct difference in the willingness of to invest in stocks and shares, with 17% of women having experience of investing c0ompared to 31% of men.
The UK Co-founder at Scalable Capital, Ella Rabener, stated in the results that: “As a financial service provider, we need to better address the needs of women so as to take away the fear of capital markets.”
The survey shows that 5% of the women interviewed about their saving didn’t know if they had started to prepare for the future, which aligns with the notion that the main barrier is lack of education and confidence. With 4% of men giving the same answer, however, lack of education about pensions is spread over both genders.
What were the other barriers, and how can women overcome them?
The ‘Women and Retirement Report 2016’, published by Scottish Widows, suggested that another major barrier was that retirement saving is simply not seen as relevant to women’s lives here and now. In the same report, 18% of women said that they don’t ever expect to retire. This shows a shift in the way of thinking and supports the idea that the priority is very much the short term in many cases.
According to the report, the average age that women were going to start saving for retirement in 2006 was 28. In 2016 that figure had risen to 32 years of age, which as the study suggests, may correlate with the average age of a first-time mother increasing.
The order in which women are prioritising their finances, also sheds light on why saving for the future isn’t in the minds of the majority. Data from the Fawcett Society, a women’s rights charity, recently showed that women are more likely to prioritise other areas of expenditure, including:
- Paying off debts
- Getting onto the property ladder
- Supporting family
- Travel and holidays
- Health and fitness
before saving for retirement.
This shows different behaviour than in men, but it isn’t clear how a better understanding of pensions and retirement savings would affect this order. The report showed a positive outlook for the future of women’s pensions, concluding:
“The difference between male and female retirement saving is stark, but the reasons for it are multiple and complex, sometimes deeply embedded in our national culture. It will take a concerted and focused effort by Government, pension providers, employers, advisers, campaigning groups and individuals to ensure that more women are empowered to take ownership of their financial futures and can enjoy them.”