LIFE is good when you have an income to rely on, isn’t it?
But how well will you cope when you reach your age of retirement and your income goes away?
Happy Ngale, financial planner at Alexander Forbes Retail, said retirement sounds far away when you are young but the reality is, it always arrives far sooner than expected. And when it arrives people then realise they don’t have nearly enough money to support their lifestyle.
Research shows that only about 6% of Mzansi people retire comfortably.
“Both single and married women have extra retirement challenges.”
“Women generally earn less than men. Throughout their career, women experience difficulty in negotiating for salary increases or better positions in the company.”
According to the Global Gender Gap Report by World Economic Forum, Mzansi men on average earn 67% more than women.
The lower average salaries translate to lower contributions into the retirement funds which result in less money at retirement.
Studies have shown that on average women live five years longer than men. This is another lifestyle risk as it exposes women to outliving their retirement savings.
Longevity not only affects income sustainability but also retirement medical funding. Ngale said that as the cost of healthcare rises with age, many people find their medical expenses outpricing their fixed income.
“There is also a high number of women whose financial security is dependent on their partner’s decisions.
“This makes it difficult for a woman to plan for her own retirement.”
Ngale said women need to take responsibility and being in charge of their own finances and this includes planning for their future.
“This can start with an understanding of simple and basic financial principles such as budgeting and money management.
“Women also need to learn how to spend money appropriately and start planning for a life in which they are well cared for, whether with or without a spouse.”