Earlier today, the hot topic, yet again, was that the gender pay gap has widened and that women will retire with $70,000 less than their male counterparts. There has been much debate and seemingly very little action when it comes to this issue. It is a complex one, in that, most women don’t think that they will be a statistic and yet women continue to stick their collective heads in the sand and the gap continues to widen. Those most at risk are women in their forties, fifties and sixties who become single due to divorce or the death of their partner.
On the surface it seems that the issue of gender pay gap is too large to tackle and maybe it’s just best to leave our fate to the future but underlying the issue is one that most do not want to contemplate – a lack of understanding of money.
Women often defer money matters to their male partners even though statistically they are often the major income earners in the household.
Women aged 25 to 40 are the fastest growing wealth demographic and 80% of all purchasing decisions in Australia are made by women.1
Women have enormous influence when it comes to driving economies:
Globally, women are an economic force more powerful than India and China combined. They are key financial decision makers in most households yet, at current forecasts, many women will end up living in poverty in retirement if things don’t change. 2
There is a way forward and it starts with money education and mentoring. There needs to be education around all things related to money i.e. understanding saving, investing, leveraging money, good debt, bad debt and how to be in control of money instead of it controlling you.
There is also a strong message for our daughters, sisters and mothers and that is to start having real conversations around money and take responsibility for your own finances. One thing is for sure: No one needs to live in poverty in retirement but women must start working towards financial freedom and making wise investment decisions for the future. They have the ability to potentially transform their retirement outcome to one that is positive and life changing.
(source 1: Harnessing the Power of the Purse: Female investors &Global Opportunities for Growth, Centre for Talent Innovation 2014)
(source 2: What Pay Equity Means For Women, Equal Opportunity for Women In the Workplace Agency
