<\/p>\n
Every Women\u2019s Month, the same financial advice is given: Budget carefully, invest early, insure yourself, and draft a will. None of this is wrong. It is simply incomplete.<\/p>\n
This advice treats women\u2019s financial outcomes mainly as a matter of better choices, while ignoring that most financial plans are built around a particular life: Uninterrupted full-time work, steadily rising earnings, regular retirement contributions, and a predictable retirement date.<\/p>\n
Many women\u2019s lives do not look like that. Their earnings may start lower and bend more often. A baby arrives. A parent needs care. The family relocates, or one spouse\u2019s career takes priority over the other.<\/p>\n
Paid work becomes part-time, pauses, or restarts at a lower level. These may be family decisions, yet their financial cost often lands in one person\u2019s retirement account.<\/p>\n
This is the missing economics of career breaks. A year of not working does not cost only one year\u2019s salary. It can also mean missed retirement contributions, employer benefits, promotions, salary progression, and years of compound growth on money never invested.<\/p>\n
If a woman returns at a lower salary, the penalty continues. A five-year break can, therefore, create a hole far larger than five years\u2019 worth of savings.<\/p>\n
Read:
Unequal futures: The financial reality of women\u2019s retirement
Who is the financial advice industry really talking to?
Financial planning for women: Are you optimising your annual tax benefits?<\/p>\n
Longevity then turns this gap into an even greater obligation. Women generally live longer than men. The person with fewer uninterrupted years in which to accumulate wealth may, consequently, have more years of life to finance.<\/p>\n
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This is the double-compounding problem at the heart of retirement planning for women. Longevity planning cannot simply mean chasing a larger lump sum.<\/p>\n
It must consider durable income, healthcare, housing, the possibility of living alone, and who can assist if financial decision-making becomes harder. A longer life is a gift; an underfunded one can become a prolonged exposure to dependence.<\/p>\n
Marriage can further disguise this risk. A household may be wealthy while one spouse remains financially vulnerable, without assets in her own name, an established credit record, adequate retirement provision, or a clear understanding of the family\u2019s finances.<\/p>\n
Every spouse needs a financial identity<\/p>\n
Having a financial identity does not mean keeping secrets or expecting the marriage to fail. It means understanding the marital regime, attending planning meetings, knowing where investments and debts are held, having access to documents, and understanding the wills, beneficiaries, and insurance policies. No one\u2019s first serious financial education should occur while grieving a spouse.<\/p>\n
The better response begins before a career break. If a household benefits from one person providing unpaid care, the household should continue funding that person\u2019s retirement, risk protection, skills, and eventual return to work.<\/p>\n
Care has economic value even without a payslip. Life cover should, therefore, recognise the cost of replacing caregiving, not only the loss of a salary. This reframes the question. Instead of asking, \u201cCan she afford to stop working?\u201d, families should ask, \u201cHow do we prevent a shared family decision from becoming her private retirement penalty?\u201d<\/p>\n
Other foundations also still matter. Investing small amounts early allows capital to begin compounding before life becomes more expensive. Income protection defends what is often a young woman\u2019s greatest asset: Her future earnings.<\/p>\n
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An emergency fund buys decision-making time during illness, unemployment, divorce, or bereavement. Continued education protects her ability to re-enter the workplace and rebuild income. These are not disconnected financial products. Together, they create resilience across life transitions.<\/p>\n
Read:
SA women: Five of the biggest obstacles that stand in their way
Financial planning for women: Five ways to protect your financial future<\/p>\n
The consequences are also intergenerational. Intergenerational wealth is transferred through behaviour before it is transferred through an estate. Children who see both parents discussing investments, debt, and insurance learn that financial agency does not belong to one gender.<\/p>\n
Financial planning for women should, therefore, not be a pink version of the same plan. Equal products can produce unequal outcomes when people travel different economic paths. A serious financial plan asks more than, \u201cHow much have you accumulated?\u201d; it also asks, \u201cWhose life did our assumptions describe?\u201d<\/p>\n
True financial well-being is the ability to withstand disruption, participate confidently in decisions, and retain meaningful choices. Women do not need another lecture about saving. They need financial plans that are honest enough to put a price on time.<\/p>\n
Dr Francois Stofberg is a financial well-being economist at the Efficient Group.<\/p>\n
Read:
The inclusion of women in financial planning
Smashing retirement\u2019s glass ceiling: Expert tips for women
Financial advice for women starting out their careers
Financial planning for women: Protecting your finances against divorce<\/p>\n
#financial #planning #wrong #women<\/p>\n","protected":false},"excerpt":{"rendered":"
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