Top 53 mistakes women need to avoid when planning their retirement. Stefania is 25 years old and she never thought she'd find herself without enough money to live in dignity. Today she is a reality that she has to face. After XNUMX years of marriage, an unexpected divorce came. Her children, now grown up, are far away. The pain of separation and the difficulties of starting over weren't enough, Stefania wonders: “How will I face the daily expenses now? How to plan for tomorrow?”. Stefania's is a story common to many women. Better to equip yourself in time, one might say. But how? Here you are the decalogue of mistakes to avoid suggested by Allianz, to make women understand the advantages of correct financial planning, a guarantee of adequate income and a solid pension.
1) My husband earns well and can support me too.
Attention! Divorces and separations are two phenomena in constant growth: if in 1995, for every 1.000 marriages there were 158 separations and 80 divorces (Istat data), in 2009 there were 297 separations and 181 divorces. Almost one in two married couples therefore face separation or divorce. The husband's retirement savings are often not enough to support both partners in their retirement years. For this reason it is absolutely necessary to take care of one's own future independently.
2) I'm not interested in the pension topic, I'll manage somehow.
This attitude can have fatal consequences on your future income. Women who, during their years of work, have taken charge of the family, of the house, of family members who are no longer in health, risk not being able to count on a sufficient income. Still quoting Istat data, women receive an average gross pension of 12.840 euros a year, against 18.435 for men.
3) I'm just thirty years old, I don't have to think about it now.
Wrong! It's crucial to start saving for retirement as soon as possible. In fact, an ever-increasing number of years of contributions is required to accrue the right to the pension benefit. And the size and duration of contributions is essential in determining the size of the future pension. Recent social security reforms lead to a reduction in the replacement rate (ratio between the first pension and the final salary), especially for younger female workers.
The higher the replacement rate, the more the pension will be sufficient to guarantee a standard of living similar to that enjoyed during the working period. For this reason, a supplementary pension investment is important.
4) Part-time and small jobs, somehow enough for retirement.
Wrong! Given your limited income, you will be entitled to an equally limited pension. It is therefore better to check whether it is possible to increase one's contributions to be entitled to a higher pension and always consider integrating the pension income with a supplementary pension investment. Social security is structured around three pillars: the compulsory pension, supplementary pension funds and individual insurance policies set up for social security purposes.
5) I have to take care of the children, so I can't work.
Risky! If in some countries the commitment dedicated to the care and education of children for long periods is recognized, in Italy the legislation provides for the compulsory maternity period, i.e. five months between the birth of the child, in which the worker receives almost all the salary (plus social security contributions) and the so-called parental leave (6 months of optional maternity leave) during which the worker will have 30% of her salary and the guarantee of notional contributions and length of service.
6) After maternity leave, I never thought about getting back into the game: going back to work weighs heavily on me.
Indeed, after motherhood, women find it difficult to return to their previously practiced profession. Often they have to settle for part-time activities or a small freelance business. The pension rights acquired through these activities are lower than through full-time employment. In these cases it is necessary to start saving early to fill the pension gap with supplementary instruments.
7) I'm 55 years old, I can stop paying contributions because the pension will come soon.
False! Even after the recent social security reforms, those who are 55 today will have to continue paying contributions for several more years. From 2018, all women will have to work up to the age of 65 in both the public and private sectors. Furthermore, each year of non-payment of contributions reduces the amount of the pension for the entire period in which it will be received. Important: If you continue to work beyond the statutory retirement age, the amount of your pension may increase.
8) I have to take care of my elderly and sick parents. This commitment will be recognized to me.
It is necessary to verify to what extent the care of family members is recognized for the payment of the pension. Normally, it depends on some factors such as the degree of disability of the person to be assisted and the length of the treatment period
9) The financial crisis has burned the savings of many. I will never invest in stock markets.
Wrong! Especially young people should have shares in their pension package. Even if the value of the shares falls, it will have time to rise again over the years. The rule according to which a thirty-year-old can have a stake of up to 70% of the shares applies. Government bonds and fixed-income investments (with lower yields, but more capital security) for the same woman should amount to a maximum of 30% of the investment. The older you get, the fewer shares you should keep in your investment. A 65-year-old's share of shares should be close to zero. It's best to put most of your savings into safer bond investments. Professional operators with consolidated experience offer the best solutions for pension investments.
10) I don't need much to live, so I don't have to save.
It could be, but it is said that today's needs will also be those of tomorrow. It is advisable to calculate one's economic needs, which vary in the different stages of life: marriage, pregnancy, end of work, part-time work, children leaving home are all factors that modify economic needs. In principle, every woman should invest 10% of her income in her retirement provision.
