Should there be retirement education just for women?

This article was originally published on Benefits Canada. 

When I get ticked off with something a man does, I usually say, “Well, they die sooner.” And that’s true: Statistics Canada’s 2009 numbers put life expectancy for men at 79 years, compared with 83 for women. But will women have enough retirement income to enjoy those longer lives?

Maybe not. The mean average personal income for women is 25% lower than it is for men. Statistics Canada’s 2011 data show a similar gap: in Ontario, the gap was 26% for full-time workers. In other words, for every $1 a male worker earns, a female worker earns just 74¢.

Aon Hewitt’s 2015 Universe Benchmarks report finds that while a similar percentage of women and men participate in company retirement savings plans, women have an average of US$75,140 in their plans, versus US$127,190 for men. On average, women contribute about 7.1% of pay, versus 8.0% for men. Much of this is due to differences in pay rates.

There are employment factors, too. BlackRock’s 2014 Global Investor Pulse Survey notes a higher percentage of women than men work part time. Many women also experience gaps in employment due to maternity leaves. Some companies will top up by paying a portion of a woman’s regular salary to supplement her employment insurance for a specific number of weeks while she’s on mat leave—but for many women, that top-up isn’t enough to continue contributing to employer sponsored retirement savings plans during that year.

There’s also a knowledge gap between genders. BlackRock’s survey reports only 41% of Canadian women (compared with 51% of men) know how much money they’ll need in retirement. And only 39% of women know how much they’ll need to save to meet their retirement goals. Further, 46% of women in DC plans (compared with 18% of men) never adjust their investment allocations, and 42% say they don’t know the plan’s maximum contribution levels.

The presence of women in the workforce continues to increase: StatsCan finds 58.3% of women were employed in 2009, compared with 41.9% in 1976. So shouldn’t employers run female-only financial planning, investing and retirement workshops, focusing on issues that resonate with women?

It seems like a reasonable strategy, but very few employers are doing it. A Mercer survey of more than 150 companies across several industries in 28 countries finds female-focused education and outreach, such as financial planning workshops, aren’t a priority for most companies. Only 13% offer female-only retirement education programs (while 48% offer female-only health education programs). And only one-fifth of North American survey participants agree with the following: “Our main retirement/savings education/training programs are customized to different gender behaviours.” That needs to change.

In the BlackRock survey, 21% of women admit they’re “not confident” about their portfolios. But women need to be confident and able to rely on themselves. If they’re married, they have to be prepared for divorce or a spouse’s premature death. Since the ’80s, Statistics Canada has projected a third or more of marriages will end in divorce by the 30th anniversary. And what about those women who choose never to marry?

Virginia Woolf was right: “A woman must have money and a room of her own if she is to write fiction.” She also needs women’s-only retirement education.