Today’s women risk being worse off than their partners, mothers or grandparents, despite improvements in gender equality, a report has suggested.
The Chartered Insurance Institute’s “Securing The Financial Futures of The Next Generation” Report describes today’s women as “profoundly more exposed to financial difficulty” than their male partners, mothers or grandmothers.
The report identified six key moments in life where women should be supported to combat the disproportionate financial risk borne by women.
Dubbed, Moments that Matter, these points in life include while growing up and studying, when becoming a mother or carer, when planning for retirement and when becoming ill and dying.
Women face an uphill struggle when it comes to saving, and are more likely to be constantly juggling life, career and kids leaving little room for managing their finances.
Inga Beale, chief executive of Lloyds of London and patron of Insuring Women’s Futures, said today’s women are simply unprepared for the risks that they face in life.
Ms Beale said; “Much has changed in the century since British women gained the vote, but there is significantly more to do to support women’s equal progression, improve women’s risk resilience and secure their financial independence.”
A task force comprising senior representatives from across the insurance and planning profession has been established to act on the issues raised in this report.
The report showed that women remain significantly dependent on their male partners, particularly in retirement, and risk poverty later in life.
It also revealed that divorce and separation is crippling many women’s long-term financial independence, and increasing amounts of cohabitation with lower legal rights compounds this issue.
Jane Portas, lead author of this report and partner at PWC, said many of the issues found in the report were deep rooted.
She said: “They will only get worse for the next generation unless we act now with fresh, innovative approaches and a change of mind-set.
“Improving outcomes for women requires collaboration between the insurance and financial planning profession, policymakers, employers and society.
“We need to find new ways of educating and engaging, consider policy approaches that can pave the way for alternative forms of access to risk and financial solutions, and to make financial planning and insurance more relevant and accessible to the many.”
Financial experts agreed that more needed to be done to increase women’s financial resilience.
One said: “There are various steps women can take to increasing their own personal financial strength.
“A large part of that is from equal pay and equal treatment, of which we are still on the cusp of this much needed change. In addition women simply need to take control; arrange insurance for ill health, save money, choose their partner wisely and base their financial decisions on their long term goals.”
Kate Smith, head of pensions at Aegon, said that focusing on the moments that matter in a woman’s life was a good way to improve female finance.
Ms Smith said: “From career choice and education to relationships, motherhood and health, we need to look at each of these factors and ask ourselves and the government, whether more could be done to prevent young women of today being worse off financially than their mothers and grandmothers.
“Women face an uphill struggle when it comes to saving, and are more likely to be constantly juggling life, career and kids leaving little room for managing their finances.
“But it is crucial that they actively engage with their financial plans and pension savings – burying heads in the sand is simply not an option. This shouldn’t be an issue which is looked at just by women.”
In today’s world, couples should discuss their finances together to make sure both partners are on track for individual financial security.
Ms Smith said the industry, the government and employers have an important role to play in this, be that through providing online tools, supporting people with their financial planning in the workplace or encouraging engagement with professional advisers.