Women must plan for comfort in their golden years

The odds against women are an important aspect of retirement that is often overlooked.

The odds against women are an important aspect of retirement that is often overlooked.

All workers should contribute to pension or provident funds so that they have sufficient money to survive on during retirement, but women should consider extra factors.

Employees have a choice to join the fund at their company and many women declined this opportunity. Many older working women were discouraged from joining retirement funds by their husbands who often advised them not to join the funds because of the small chance that they would remain with their companies until retirement.

Many of these women were ill-advised to rely on their husbands to organise retirement finances. In many instances, women have continued to work and the family has relied on incomes from both spouses. How on earth will the family survive on a single pension at retirement?

Many marriages end in disaster, leaving the wives facing severe difficulties at retirement. Another concern is that a husband's pension might be reduced by 30percent to 50percent when he dies, particularly if it is paid from a defined benefit pension fund.

Many funds once allowed women to retire at a younger age than male colleagues. Women have a longer life expectancy than men, so life companies offer women lower rates and they need bigger nest eggs to cater for more spending years.

Women generally earn a lot less than male counterparts, which means lower contributions on their behalf.

Most companies offer maternity benefits, but many women leave their jobs for extended periods to raise their children. Pressure to run a home and care for children often leads women to choose different jobs later, so they lose out on potential earnings.

Because of all these factors, I recommend that women calculate the additional amount they will need to compensate them at retirement. The first step in this exercise is to start the savings programme without delay.

Bryan Hirsch is chief executive of Pioneer Financial Planning. Visit www .pioneer.co. z a or e-mail help@pioneer.co. z a for more information.