The gender retirement gap is frightening for women

Women across the globe are far more likely to end up impoverished in their retirement years than men

Illustration by Gary Clement
Powered by automated translation

It’s been cited as the single largest issue we will face in personal finance terms in the 21st century. I see it as frightening, unfair and unacceptable and believe that expat women are at the biggest risk.

The issue is retirement. The funding of it is of increasing concern the world over, due to national budget deficits and more. This being Women’s History Month, I’m focusing on the gender retirement gap that already exists. The word gap doesn’t begin to get across the chasm that it is.

In a nutshell, women are at real risk of being impoverished during retirement - we are talking poor. We don’t have real, timely figures for the UAE expat community, but I think it’s fair to extrapolate from what’s out there. Last year Mercer, a global consultancy focusing on health, wealth and careers, found that women in the EU will retire on 40 per cent less than male counterparts. In the US other research cites a 30 per cent difference, in Australia it’s 47 per cent less. It’s always significantly, and painfully so for women, less.

You might think this applies to women lower down the ladder. Not so. Women in top paying jobs will be 38 per cent poorer than their male colleagues when they reach old age. This is according to research conducted by UBS Wealth Management, released a few months ago. UBS looked at a hypothetical Jane and Joe over their earning lifetime, added an assumed pay-gap of 10 per cent (the gap is significantly more than this in most instances), took into account a career break for childcare, and found that the women earned $800,000 less than the men over their lifetime.

Personally I think this situation is compounded for expat women. Why? Because many follow their husbands into the unknown. This results in yet another career and earnings gap. Often work is something she is over qualified for, to fit in with the family’s new needs and reality. Compound this over her lifetime, and we have a lot more financial loss than the studies above exhibit.

Then there’s divorce. Add this to the mix, and boy is a girl in trouble. So, what can a 50-year-old woman do, who finds herself with zero savings and no retirement fund?

Back to the Swiss bank UBS and another study. They built up a scenario for a 50-year-old woman, named Jane again, with no savings, who earned the average wage for her age group, and 10 more years of work before retirement. I’m sure there are many that fit this picture.

They wanted to find out how much this woman would need to put aside, on top of mandatory retirement savings programmes, in major cities around the world.

If you’re from any of these cities, and wanted to compare how you would fare, then I suggest you find out what the median salary for your age-group/ career is back home.


Read more:

Ladies: don't fall into the investment gap as well as the gender pay gap

Establish financial boundaries with family members to avoid a fallout

Generation Z looks to have the financial edge over Millennials

More attention needed to link between financial woes and mental health


The bad news is that it’s a huge ask. Actually, for Asian Janes, it’s simply impossible - they need to save over 100 per cent of their earnings to be able to afford to retire. Hong Kong Janes must save 153 per cent, Japanese Janes 148 per cent and Taiwan Janes an unbelievable 157 per cent.

Beyond Asia, the only other place where Jane would need to save more than half her salary is Canada at 62 per cent.

I’ll rattle through a few more pertinent examples now: for the US it's 49 per cent; UK, 47 per cent; Germany 37 per cent and Australia comes in at 37 per cent.

Switzerland comes out top at 11 per cent. Again, this is the proportion of salary that needs to be saved for 10 years in order to afford to retire.

Remember, these calculations were carried out assuming the state pension would kick in upon retirement - so this income needs to be factored in too - or the lack of it if you’re an expat who hasn’t contributed to any state pension funding back home.

Now, I hope you are not a 50-year-old woman with zero savings, in which case, note this: a woman must save 18 per cent of her income to maintain the same retirement pot as a man who saves 10 per cent of his earnings. That’s throughout her working life.

This is because, on average, a woman works 25 per cent less year - due to childcare, not holidays; earns 25 per cent less when she does (at least) and does not invest as much as male counterparts, and is more risk-averse if she does.

This is precisely why women in the US are 80 per cent more likely to be impoverished in their golden years, according to the National Institute on Retirement Security.

In the UK, two thirds of pensioners living in poverty are women.

So, what is the solution?

I’ll stick to simple personal finance related suggestions as part of dealing with this, though this is by no means the solution to the issue.

To all the women out there:

  • Save more (I know it's rubbish. You get less to start with, have more on your plate and now this)

  • Look at options for guaranteed lifetime income (no, a husband is not what I'm talking about – check out annuities for example)

And get started. Good luck.

Nima Abu Wardeh is a broadcast journalist, columnist and blogger. Share her journey on