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SA women ‘earn’ less than men even in retirement

Influenced by decades of inequality, breaks in careers, wage differences – and a higher cost of converting accumulated savings to an income.
On average, women earn less, make lower retirement fund contributions, and live longer than men. Image: Shutterstock

South African women can’t seem to catch a break as the effects of the gender wage gap threaten to follow them into retirement.

An Alexander Forbes study based on member analysis and released on Tuesday has shown that women are likely to get about 10% less income from their retirement funds than men.

The reasons for the gender gap include the consequences of decades of inequality and breaks in careers to raise a family, according to the report. “It is also a result of lower contributions being made to retirement funds by females, in general, as well as the fact that after retirement females live longer than males on average.”

Having a longer lifespan, on average, means women’s retirement income diminishes because it needs to stretch over a longer period.

Replacement ratio

The survey analysed almost one million of the insurer’s retirement fund members and found that in 2020 the replacement ratio for working females was 26.56%, while that of their male counterparts was 35.3%. The ratio for women even came in about 5% lower than the overall average of 31.47%, the company stated in a presentation.

Read: Equal gender pay set back a generation by pandemic, WEF says

The country’s largest (private) pension fund administrator projected that the average replacement ratio will increase to 40%, which is still significantly lower than the ideal ratio of 75%.

“According to Member Insights, only about 6% of retirement fund members can expect an income in retirement above 75% of their pensionable salaries,” the company found.

While the gender pay gap for the bottom 10% has “equalised” over the years, it remains relatively high across major sectors.

On average women earn 83 cents for every rand earned by their male counterparts.

This gap widens in some sectors like agriculture and business services, where women earn 81 cents and 77 cents respectively.

“If we look at the top 10% of the highest salaries, the gender wage gap is 7%, meaning for every R1 a male member earns, the female member earns 93 cents,” says Ntsheki Molefe, regional executive for retirements at Alexander Forbes.

Reform to improve preservation

The Covid-19 pandemic saw growing appetite among South Africans to cash out retirement savings to make ends meet. However, the company advises against people cashing out their savings before maturity.


Instead, Alexander Forbes supported the “two-bucket pension reforms” proposed by National Treasury as an alternative that will protect long-term preservation and satisfy immediate financial needs.

Projections by the group show that future generations – who stand to benefit from the proposed policy reform – could see their retirement outcomes double, at the least.

“People’s savings [could] be anywhere between two and two-and-a-half times better over a 35-40-year period because of this – even if they were to take their short-term bucket,” says John Anderson, Alexander Forbes’s executive for investments, products and enablement.

Anderson added that their modelling of the two-bucket system revealed that if people were to preserve both their long and short-term investments over the 40-year period, they would receive the desired 75% replacement ratio at retirement.

Impact on millennials

The group’s research also revealed that early millennials below the age of 24 suffered greater financial stress due to the pandemic, which resulted in significant job losses and left young people at a higher risk of defaulting on their loans.

“The analysis found that at least 14.11% of loans taken by Early Millennials were in default, followed by Late Millennials at 4.79%, Generation X at 2.27% and Baby Boomers at just 0.94%,” the company said.

“This [unemployment] is going to continue being a huge challenge in the industry because it’s these years when people contribute towards their retirement that makes a huge difference,” Anderson said.



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What you study, plays a part a part in how much you earn.

If you study marketing or tourism management you will earn less.

Doing a degree in English provides you with no additional skills, as it is a language that everyone is already familiar with.

Women outlive men by around 7 years on average…. Why is this?? Studies have shown its cause men work harder and longer hours than females. When the mortality rate between genders that had the same roles and hours ect were studied researchers found no difference in the mortality rate between male and female….
I’ll L bet money on the fact that if u compared the pensions between those 2 genders that had the same mortality rates ud find there pensions were pretty much on par with each others.

A hair dresser that works for 30 years in the system is gonna have a bigger pension payout than her peer that only worked for 20…..
This isn’t rocket science. And niether is it inequality.

Now if u trying to compare the hairdresser that only worked for 20 years to the ceo that put in 35 years and was responsible for 10 000 people under him……. To try describe that as
Inequality is the wrong word.
The correct word would be jealousy.

For the same position, level of occupational danger and working hours, the so-called gender pay gap does not exist. It’s very simple: no sane capitalist would pay his employees more than his competitors for the same level of productivity. If there was this alleged giant conspiracy against women, business owners who were part of this alleged conspiracy and discriminated against women, would find themselves going out of business, because their competitors would simply out-compete them by appointing women.

The fact that the above doesn’t happen, shows us that employers do not, in fact, receive the same level of productivity from women. There are many reasons for this, including the fact that many women choose to rear families. They are therefore out of the labour market for extended periods, and their working hours are shorter than men’s, because of family commitments. There is nothing wrong with the above, because many women knowingly choose this.

One mustn’t mention AF and Integrity in the same sentence. I have personal experience of their underhanded dealings when my wife resigned and we had to transfer her pension.
Another thing, if all were equal between the genders, females will still receive less pension BECAUSE THEIR LIFE EXPECTANCY IS LONGER! This fact was conveniently ignored by AF in this article. Also, when a married male passes away, the widow anyway has a claim against his estate by law, whether or not he left her a pension.
Very biased research and in true AF nature, untrustworthy.

This is a contentious headline. The fact is, a man investing R100.00 in a retirement fund will earn X. A woman investing R100.00 in a retirement fund will also earn X. The investment market does not discriminate on where the source of funds comes from (based on gender).

The inequality starts at the pay scale level not at the retirement pension fund level. Rather argue that generally and historically women have had less income to save for retirement than men doing the same job.

The answer is in the article. If women want the same pension, then don’t have kids and don’t outlive males. But if that doesn’t suit you, then accept that equality can’t be achieved if things aren’t equal.

There will always be inequalities. Both men and woman are over represented in certain sectors. the average pay of each sector differ. nothing new.

One possible reason that woman tend to take care of the family and give up their career, is hypergamy. (marrying a person of a higher socioeconomic or social class than oneself). Obviously the lower income will be sacrificed.

End of comments.



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