Despite some improvements in work, women are still lagging behind on pay
International Women’s Day will find not only are women earning less, but they’re living longer, causing new issues
According to an EU study last year, women across Europe earn around 16 per cent less per hour than men
There can be no doubting the strides that women have made in recent decades when it comes to professional development; but when it comes to discussing personal finance and women, it’s still hard to get away from two key facts – they earn less and yet live longer than men. This raises a host of financial issues specific to the fairer sex.
Ahead of International Women’s Day on Saturday, we take a female specific view on personal finance and find out where women are winning – and where they still need to catch up with their male counterparts.
Women still earn less
They out-perform their male peers at second level and university; they are frequently at the top in professional exams, and have risen to the top of most career ladders, yet women still lag their male peers when it comes to how much they get paid.
According to an EU study last year, women across Europe earn around 16 per cent less per hour than men. Ireland performs a little better than this, with a gender pay gap of 13.9 per cent, and considerably better than the UK where the gap is as high as 20 per cent. However, this still means that for every €100 a man earns, a woman will typically only earn about €86.
There are some obvious reasons for this. Women are the majority of part-time workers in the EU, with 32.6 per cent of women working part-time against only 9.5 per cent of men for example. But discrimination, opting for lower paid jobs and performing poorly when it comes to pay negotiations, mean that women continue to lag their male counterparts.
Women may not have enough life cover
How much is your life worth? While “priceless” might come to mind, if you’re buying a house or have dependents, you’ll have to put an actual value on it, and make sure that you putting enough of a value on it.
It’s a common mistake among couples. Together they take out mortgage protection to cover the cost of their home or investment properties, but when it comes to putting protection on their own life, women are still opting for inadequate protection. With men still less likely to take a step back from their career, they typically have greater life assurance protection, given that they may be entitled to death in service cover at work. A woman in a part-time role on the other hand, may have fewer entitlements, while the overall cover may be less, given a lower salary.
And a stay-at-home-mother might not realise just how much it would cost to replace her – childcare, housekeeping, etc – while even women who out-earn their partners may not adequately value just how much they are contributing to their family’s finances, and how much that family could suffer financially if the matriarch was to die. “Women need protection regardless of whether they’re earning or not,” says insurance broker John Geraghty.
Consider also that you may now need to pay more for this. Given their greater longevity, women typically had to pay less for life cover than their male counterparts, but since the introduction of Europe’s Gender Directive in 2012 insurance companies are now unable to quote on the basis of gender.
According to Geraghty, this means that life assurance has become more expensive for women and products like income protection have become cheaper for men. However, he notes that life assurance prices have in general been on a downward trend, which may compensate somewhat in the increase women will have seen.
If you have a limited budget, it might make sense to focus it on where you might need cover most. For example, Geraghty says that an analysis of all the claims paid by insurers on their female customers, nine out of 10 claims will be for cancer. Given that serious illness policies are expensive, he suggests opting for a cancer cover policy, such as that offered by Zurich. For example a policy covering €200,000 of cancer cover for 20 years would cost €15.18 a month for a female aged 20, rising to €58.45 a month for a 40-year old female.