Women’s financial wellbeing in retirement is influenced by a variety of contextual factors and by decisions women make during their life course.
Aotearoa New Zealand provides a universal pension, which is a key source of income for older people (especially those living alone). However, women tend to have less net wealth at retirement than men.
This is because women earn less than men on average due to multiple factors, including:
- gender and ethnic pay gaps
- employment gaps with time out of paid work to raise and care for children
- a higher burden of unpaid work
- the undervaluation of roles where women are predominantly employed
- underutilisation, including underemployment where people who are employed but want to work more hours.
Lower lifetime earnings may in turn have impacts on women’s health, wellbeing, economic independence, and ability to save for retirement.
People's experience of retirement, and the impact of retirement income policy, is not the same for everyone.
Te Ara Ahunga Ora Retirement Commission conduct research on the impacts of retirement on women and have found:
- Women experience a 20.2% gender gap on average compared to men in their KiwiSaver balances.
- The gap becomes more pronounced in older groups, with women aged 51 to 55 experiencing a 27.2% retirement savings gap to men of the same age.
- Gender gaps in retirement savings widen in every age group category throughout women’s working lives - 23% for 18 – 25-year-olds and 27% for 31 – 35-year-olds.
- The average KiwiSaver balance as at 31 December 2022 for men was $31,496, compared to women at $25,144.
- Women aged 65 and over are more likely than men to be living alone in retirement due to their longer life expectancy.
- Women over 65 receive less income than men – around a third of men aged 65-69 receive less than $30,000 per annum, compared to almost half of women.
- Personal income plays a significant role in women’s financial resilience and wellbeing, with wāhine Māori overrepresented in the lowest personal income bracket.
- One in five women have an account but don’t contribute (22% compared to 16% of men).
- Women have often been thought to be more risk averse than men. However, recent analysis of KiwiSaver balances does not support the idea that women aged 45-64 are more conservative investors than men. Instead, it depends on the size of KiwiSaver balance, as both men and women tend to invest in lower risk/lower return funds if they have small balances and tending to invest in growth assets if they have larger balance.
- Financial education in schools and workplaces fails to reach or engage women as well as it does for men although wāhine Māori and Pacific women are more likely than average to say they are accessing this information at work.
The Retirement Commission also collate resources around the impacts of retirement policy on different demographic groups in Aotearoa New Zealand, including women, older people, Māori, and Pacific Peoples.