Why pension planning is even more important for women

For every EUR 100 in pension that a man receives on average in Belgium, a woman has to manage on just EUR 77. This can be seen in the figures from Pensionstat. While the gender gap for the statutory pension is 20%, it grows to as much as 50% for supplementary pensions.

The lower pension is by no means the only challenge. When you turn 65 in Belgium, you can expect to live for around 12.5 years longer in good health on average. In this respect, there is Virtually no difference between men and women. However: in our country, women live 4.3 years longer than men on average. As a result, they also live for more years in which they are likely to have health problems. This means women not only need more money to enjoy a comfortable pension for longer, but they have to deal with higher spending on healthcare.

If a woman has a male partner, their is a good chance that she will survive him and thus become solely responsible for the shared costs. This also means it is important for women to start working on their pension plan early on.

Why do women receive a smaller pension?

The pay gap is one important cause of the pension gap between men and women. This gap amounts to 9.2% if adjusted for working hours and 23.1% without it being adjusted. This can be seen in the figures from the Institute for Gender Equality.

When there is less money coming into the house, it can be more difficult to save and invest for one's retirement. Because women also do less paid work than men on average (in part by taking on more unpaid care responsibilities than men), their statutory pensions are also lower.

What steps should you take to boost your pension?

> Provide overview and insights

This is important not only if you are single, but if you live with a (male) partner. Several surveys have shown that men are more likely than women to take the initiative when it comes to financial matters. It is tempting to think that this is only the case for older generations or in couples where the man is the "breadwinner", but this is not always the case.

With a limited overview of daily finances and long-term planning, it can be harder to know how well prepared you are for retirement. You do not necessarily have to do every financial task yourself (you may be busy with other things or simply prefer to take on other responsibilities), but it is important to be aware of what is going on.

Don't know much about financial matters? The Internet is home to various blogs on money matters that are written specifically for women. These can be a good way to explore the domain. Also consider getting some professional advice and guidance.

> Make a plan

Creating a detailed plan for your pension is crucial. Start this process by answering some questions: What does a "comfortable" pension mean for you? How much money do you think you need to maintain the lifestyle you want? What can and do you want to change in order to achieve these goals? Answering questions such as this means carrying out a thorough review of your current financial situation, your future income expectations and your life expectancy.

Simulate how much pension you will receive on mypension.be. Figures from Statbel show that Belgian pensioners spent around EUR 24,250 per year on all goods and services in 2022 (average spend per person).

> Take parental leave or time credits instead of working part-time

Women are more likely to choose part-time work in order to be able to care for their children and others. If you are considering reducing your working hours, it is a very good idea to first explore the options of parental leave and time credits available in your current full-time employment, before switching to part-time work. Unlike part-time work, parental leave and time credit have no impact on your statutory pension. These periods therefore simply count towards your pension.

> Consider getting married

This may sound cold and calculating, but aside from romantic and other considerations, it might be better for your retirement if you are married. Here's why: If you are married and one of you has no or a very low earned income, you and your family may later be entitled to a family pension. This pension is higher than for single people.

Marriage can also create solidarity between you. This can be done, for example, by marrying under the legal marital property regime. As a rule, all income during the marriage will then be shared. In the event of divorce, the shared pot is divided into two equal halves.

> Start a pension savings scheme

By saving in a pension scheme, you are making sure you have additional income on top of your statutory pension. Each year you save a certain amount for your pension, which you use to build up pension capital. An additional advantage is that pension savings attract tax benefits, as you can claim a tax reduction on your contributions. If you pay in up to EUR 1,020, you will benefit from a tax break of up to EUR 306.

> Consider investments

Women are generally smart long-term investors, as they are less quick than men to react to temporary market fluctuations. However, research also suggests that women are inclined to hold more in cash. If you are too defensive, you will likely miss out on long-term growth. Of course, investing too dynamically can also have negative consequences. The right investment mix depends on your needs and circumstances. Are you considering taking your first steps into the stock exchange? You can do so using just small amounts if you prefer.

Saving and/or investing for later?

Start right now with a savings account with an attractive interest rate, and/or start investing