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Women on average will retire with 80% less money than men, according to the Chartered Institute of Insurers (CII).1 And 31% of women rely on their partner’s pension as their main source of funding in retirement.
This is putting many women in a vulnerable position, especially if they were to separate or divorce – they may find they have less to retire on than expected.2
Here, we share insights from retired and non-retired women. Plus 5 things you can do today – to help you create a financially independent future.
The study, carried out by YouGov for HSBC, surveyed 1,048 retirees and 2,695 non-retirees in England, Scotland and Wales – ranging from ages 18 to 55+.
52% of women surveyed expect to struggle financially when they stop working. Younger women (aged 18 to 24) are more optimistic about their retirement, with 72% saying they expect to live comfortably.
Saving for retirement also takes a back seat when it comes to budgeting, as other things take priority. Almost 1 in 5 had to decrease the amount they set aside for their retirement due to the pandemic, and 22% had to do so to support family members.
When it comes to women who have already retired, over 90% said they need up to £30,000 a year to fund their lifestyle. However, for many women, this is difficult to maintain.
29% of retirees told us they don’t have enough money to make ends meet. 10% of retirees said their retirement savings aren’t enough to cover household bills and 30% can’t afford to run a car.
be financially independent
have sufficient funds available to support the lifestyle you want
be able to cover an unexpected expense after you stop working
Taking action feels good. Here are some positive changes you can make today for a more comfortable retirement.
If you can, now’s the time to add as much as possible to your workplace pension or your retirement savings and make the most of the tax relief from the government. Some employers offer to match your contributions up to a certain limit – if yours does, try to make the most of it.
You should also check your State Pension forecast to see how much it’s worth. If you've taken a career break, you may have gaps in your National Insurance record, which can affect the amount you’ll receive. It may be possible to make voluntary contributions to make up for these.
Explore: Our retirement calculator
Investing is an alternative way to save for your future that could potentially provide higher long-term growth than leaving your money in a savings account. The key difference is there are no guarantees as the value of investments can go down, as well as up, and you may not get back what you invest.
At HSBC, you can start investing from as little as £50 a month and lower risk options are available (eligibility criteria and fees apply).
If you’re married, in a civil partnership or in a stable relationship with shared assets, you may want to look at both your pensions and savings together. Our retirement calculator can help you work out the cost of living together when you’re no longer working.
If you’re near retirement age and are concerned you won’t have enough money, think about whether you can delay when you finish work. If that’s an option, let your pension provider know as it may make sense to change where your pension is invested.
Switching to reduced working hours or ‘semi-retirement’ can also give you more financial security, as well as a better work-life balance.
1Jane Portas, author, ‘Solving Women’s pension deficit to improve retirement outcomes for all’ published by the Chartered Institute of Insurers (CII) ‘Insuring Women’s Futures’ programme, data derived from ONS.
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