It turns out millennial women in the UK are at greater risk of growing old poor – that is, if no action is taken to raise awareness and improve financial resilience.
The Chartered Insurance Institute (CII) pointed to a combination of growing debt, lower earnings, and a lack of confidence in dealing with financial matters as what’s threatening to impoverish the female population. In a new report, it analysed the unique risks faced by women ahead of today’s event aimed at tackling what can be done by the insurance and financial planning profession, in collaboration with policymakers and the third sector, to address these ‘perils and pitfalls’.
For instance, according to the report, student debt has almost doubled in six years – with women taking longer to repay due to lower earnings throughout their careers. The CII noted a 9.4% gender pay gap, which it said is not due to close until 2050. Citing information from the Pensions Policy Institute, it added that only 54% of those aged 22 to 29 are active members of a private pension scheme, compared to about 65% of older people.
A multitude of other risks exist, including the prospect of being left more in need of social care when they age, given women’s greater longevity and younger age of marriage. It was also found that women are more likely to save than men but typically save lower amounts, not to mention findings showing women are less confident than their counterparts about managing money.
“Women continue to have a fundamental lack of financial resilience to the risks they face in life,” said Jane Portas, Insuring Women’s Futures Committee lead on Women’s Risks in Life, lead author of the report, and PwC partner. “Many of the issues leading to women’s exposure to risk are deep rooted in society and will only get worse for the next generation unless we act now. We need to find new ways of educating and engaging young women and put policies in place that support them throughout their life.
“As a society, we need to improve women’s risk protection, economic independence, and financial resilience, improving the financial future for us all.”
The objective of ‘The Big Conversation’ event was to come up with innovative ideas to help shape the direction of the insurance and financial planning profession in hopes of addressing the disparity between women’s resilience and the risks they face.