Half of working-age Canadian women are worried they won’t have enough money to cover care and medical expenses once they retire, according to a new study by HSBC Bank Canada.
Apart from medical needs, almost half (44 per cent) of this group said they’re afraid they’ll struggle to pay for basic necessities during retirement, compared with 37 per cent of men. Indeed, 51 per cent of working-age Canadian women (higher than the global average of 46 per cent) said they haven’t even started saving for retirement or know how much they plan to save.
“Women have largely closed the gap with men in terms of workforce participation, which is roughly equal today, but when it comes to finances and planning for retirement, there is still work to do to ensure equal comfort and security in retirement,” said Cindy Wong, head of retail banking and wealth management marketing at HSBC Bank Canada, in a press release.
About a third (38 per cent) of working-age Canadian women said they don’t know how much of their pre-retirement income will be enough for them to comfortably retire, higher than the global result of 26 per cent.
The survey also found Canadian women are concerned about the possibility of health issues affecting their financial security. Almost half (48 per cent) said they worry about meeting their basic needs if they or a partner had to retire earlier than planned due to ill health.
Meanwhile, 40 per cent of men noted the same concern. Should a partner pass away, 42 per cent of Canadian women said they’d find it difficult to financially cope, compared with 30 per cent of men. Indeed, women (43 per cent) are somewhat more likely to rely on a spouse’s retirement income than men (39 per cent). Women (16 per cent) are also more likely to rely on their children for financial support in retirement than men (six per cent).
Another challenge, according to 62 per cent of women, is they’re more likely to take a break from their careers to care for children compared to men (22 per cent). Even when they’re not on parental leave, women (33 per cent) are more likely to reduce their working hours to care for children than men (21 per cent). The time out from earning correlates with 25 per cent of Canadian women saying they haven’t saved as much for retirement as their partners.
“The reality is that women in Canada take time off from work to have children and bring up families,” said Wong. “This not only affects our current earning potential but future income as well. Women also generally live longer than men, so we need a higher reserve for retirement from less income.”