Women are living longer than ever before
Data published recently by the Australian Bureau of Statistics has revealed that Australian women are living longer than ever before. This can have a significant impact on their retirement and estate planning.
Females born today are expected to outlive their male counterparts. The average life expectancy for females is now 85.3 years compared with 81.2 years for males. These figures are the highest ever recorded in Australia.
When the Aged Pension was introduced in 1909, it was payable to people aged 65 years and over. At that time, most people didn’t live long enough to become eligible. And those that did, weren’t likely to get it for long. Before that, most people not working needed to self-fund their retirement.
With current life expectancy figures growing and growing, research shows that the risk of outliving retirement and superannuation savings is growing too. A 2017 study undertaken by the Actuaries Institute of Australia showed that Australian women, when compared with women in the UK and USA had an especially high risk of outliving their savings. It also found that retirement readiness is highly gender based, with men typically more prepared than women.
Australia’s ageing population also means many Australians are now required to share their time between earning a salary and the informal role of caring for elderly parents. More often than not, this latter role of informal care has been shown by the ABS to fall into the lap of women, impacting on their ability to remain in paid work.
Why it's more difficult for women to grow their retirement fund
Additional hurdles women face when building their nest egg include the following:
Women are more likely to take ‘career breaks’ or seek part-time roles in order to have and manage a family.
Jobs such as nursing, caring and teaching which tend to be dominated by females aren't highly paid.
The financial cost of divorce for women tends to be greater than that of men.
Ongoing wage inequality means that women still tend to get paid less for doing the same job as their male counterparts.
Women typically remain the primary caregiver. When a family member becomes unwell, it usually falls to women to take time off paid work to provide care.
How women can #BreakTheBias
With this in mind, it has never been more important for women to #BreakTheBias and take control of their financial wellbeing by putting a modern integrated estate plan in place. Part of this process includes arranging a legally binding Will, creating a General Power of Attorney and creating an Advance Care Directive. Further jobs on the to-do-list include checking registration and titling of assets-ownership, to avoid any surprises later on down the track, ensuring you completely understand any Binding Death Benefit Nominations you have in place, contacting a financial planner regarding Retirement Savings and speaking with a lawyer around Estate Planning.