International Women's Day 2021

• Women face more financial challenges than men, with the gender pay gap and caring responsibilities fuelling a significant gender pension gap
• Having open conversations about wealth early on, engaging with their pensions and embracing their ‘inner investor’ can help women achieve long-term goals
• Protection can help to safeguard women’s financial wellbeing
• Professional advice can deliver a raft of financial and non-financial benefits – helping women to take control of their financial futures

While it’s vital that everyone plans for their financial future, women often face more challenges than men in setting up suitable saving and investment plans – and in protecting their financial wellbeing.

The gender pay gap means many women continue to earn less than their male colleagues during their working lives – an issue that is compounded by the fact they are more likely to take career breaks to raise a family or care for relatives, and often work part time.

But not only do these issues mean women are likely to have less money to save, longer life expectancy means they will arguably need more of it in later life than men.

St. James's Place understands these challenges and to mark International Women’s Day on 8 March, we’ve compiled the essential guide to helping women of all ages secure their financial futures.

The ups and downs of a woman’s life

Over a woman’s life there are numerous physical, emotional and social needs placed on them. This has never been more obvious than in the pandemic, with women picking up greater responsibility for childcare and home schooling, while juggling jobs of their own.

But while the short-term financial penalty these demands trigger might be obvious, the longer-term consequences may be less so.

The combination of diverse factors including the gender pay gap and shorter working lives mean that many women are inevitably also facing a significant gender pension gap.

Meanwhile, life events including divorce can throw in a whole new set of obstacles. Without the financial support of a husband, many women report that their retirement prospects deteriorated after their divorce. This is why even the happiest of spouses should consider the impact a separation could have on their financial plans.

As an aside, if you were already divorced and retired before April 2016, it’s particularly important to check that you aren’t missing out on unclaimed State Pension benefits.

The financial challenges facing women are now so great in fact, that in addition to making sure parents talk to their daughters about money, some experts even suggest they put away more money for them than their sons.

Regaining control

With many women believing that even buying a home on their own is not achievable, a healthy retirement income might seem like a pipe dream – but it doesn’t have to be.

For many women this can mean changing an ingrained mindset and applying the skills you use in your working life to your personal finances.

A good start is to picture a ‘future you’. Rather than thinking of your retirement as a hazy distant concept, take the time to mull over the life you would like to lead when you retire.

With a clearer picture, it’s easier to calculate ‘the magic number’ – the income you need to make that lifestyle a reality – and get a grip on the money you need to save each month to make it happen.

Even if you’re regularly putting money away into a pension, many women don’t feel like ‘investors’ - getting more actively involved in their pension and savings plan is a crucial first step to regaining control.

By engaging with your pension, you can also look to make a difference with your contributions, by seeking out responsible or sustainable investments that support the environment as well as our communities.

Furthermore, this experience of managing your pension during your working years puts you in a better position for investing in later life and helps give you the skills to manage that pot when you do eventually retire.

Making better use of ISAs could help you to save more effectively for the future too – while sheltering any gains from income and capital gains tax. For example, at a time when interest rates are negligible, it’s worth understanding the potential advantages of investing in a Stocks & Shares ISA over a Cash ISA.

Post-pandemic review

If the pandemic has changed your working circumstances, it’s also worth reviewing your pension. If you’re returning after a period of furlough, you’ll want to ensure your pension contributions are restored to their original level. Or, if you’ve been made redundant or stopped working, make sure you’re on top of national insurance contributions.

If you’ve set up your own business, find out more about start-up financing for your initiative.

Also, if you’ve had multiple jobs in your career so far, make sure you’ve got a handle on all your pensions and that none have gone missing – and consider all of the options available to you.

Thinking about protection

When you’re planning for your future, it’s also important not to neglect the income that pays for it. Whether or not you’re the breadwinner, having in place some protection in case your health ever prevents you working can help safeguard your financial wellbeing.

The value of advice

Whether prompted by a major life change, a windfall such as an inheritance or simply as a means of regaining control over your financial future, financial advice can be invaluable.

It may do more than help you secure a wealthier future, however. Professional advice also comes with a raft of non-financial benefits – including giving you greater confidence when it comes to making financial decisions.

So, take charge of your finances and your future today. Talk to your St. James's Place Partner.

The value of an investment with St. James's Place will be directly linked to the performance of the funds selected and may fall as well as rise. You may get back less than the amount invested.

An investment in a Stocks and Shares ISA will not provide the same security of capital associated with a Cash ISA.

The levels and bases of taxation, and reliefs from taxation, can change at any time and are generally dependent on individual circumstances.