Why women feel less ready for retirement

Findings from AMP's recent Retirement Confidence Pulse identified that women are significantly more worried about life after work across every measure and are less likely to seek help compared to men.

The research indicated that 41% of women are financially confident about retirement, compared to 59% of men.

This discrepancy is exacerbated across other categories, as 73% of women are worried about having enough super for retirement, compared to 56% of men.

More women (71%) fear they won't be able to afford the retirement lifestyle they want, while concern among men (53%) is not as significant.

While 51% of women hold back on day-to-day spending due to fears about running out of money in retirement, only 42% of men share this worry.

Meanwhile, 66% of female members said leaving a financial legacy for future generations is an important goal, while only 57% of male members shared in this perspective.

The research suggested the higher level of financial insecurity among female members is due to lower super balances driven by gender pay gaps and time out of the workforce.

However, the findings also identified lower levels of knowledge and engagement among women.

Only 55% of women expressed confidence in Australia's superannuation system compared to 71% of men. Despite this, only 26% of women have sought financial advice for retirement while 34% of men have sought this assistance.

While only 34% of women indicated that they understood the concept of compounding returns before the age of 40, 61% of men said that they understood this function.

This dissonance is also represented in the 30% of women that responded they do not know who their super provider is or do not engage with their super provider, compared to the 23% of men that shared this view.

The retirement confidence gap worsens for single women, as only 36% of female respondents indicated they feel financially confident about retirement. In contrast, 45% of single men feel financially confident about life after work.

For separated or divorced women in their 40s this number dropped to 21% compared to 50% of men in the same situation. Of the members that identify as single women with kids in their 40s, only 19% feel confident in contrast to 40% of men.

AMP deputy chief economist Diana Mousina ssays aid the national gender gap in financial literacy is more severe than peer countries, such as the US, Germany and the UK.

"More than one in three Australian adults are financially illiterate and, worryingly, women consistently score lower than men - with Australia's gender literacy gap larger than in many comparable countries," she says.

"The retirement confidence gap we're seeing among women is the predictable result of a long-running financial literacy gap."

AMP group executive for superannuation and investments Melinda Howes says: "Our research shows women are more anxious on every measure, and it's no surprise given they retire with smaller super balances after years of pay gaps, part-time work and time out caring for others."

"We cannot accept a future where Australian women remain more worried than men about their financial futures."

The good news, Howes says, is that help has never been more accessible.

Mousina agreed, saying the financial literacy gender discrepancy can be fixed through better education, workplace programs and support from super funds.

Howes says: "Women can take back control by engaging with their super, knowing their fund, checking their balance and investment options, and feeling confident to ask for help."

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