Women at risk of ‘financial meltdown’

Women at risk of ‘financial meltdown’

A large number of women are yet to take responsibility for their own long term financial planning, leaving them at risk of ‘financial meltdown’, Royal London has warned.

Research by the mutual insurer found large numbers of women across the age spectrum could face financial difficulties in the event of a relationship breakdown because of their lack of financial plans and individual pension rights. 

According to the survey, 45 per cent of women living with a partner said they were either not confident or did not know if their long term financial plans would be adequate if their relationship failed. 

By comparison, just 34 per cent of men felt the same way. 

Furthermore, just 38 per cent of women living with a partner aged between 18 and 34 said they were ‘very’ or ‘reasonably’ confident in their long term planning, compared with 58 per cent of men in the same age group. 

Almost a third of these women confirmed that they haven’t made any long-term plans. 

The older age groups fared slightly better with 56 per cent of women aged 55+ saying they were ‘very’ or ‘reasonably’ confident that their plans would be adequate if their current relationship failed. 

Helen Morrissey, pension specialist at Royal London, said: "These findings are extremely worrying and show that we still have a long way to go to ensure women are building resilient retirement plans. 

"While it can be tempting to rely on the pension provision of a partner, particularly if it is generous, women risk financial meltdown should the relationship fail and they could find themselves in severe financial difficulty. 

"We need to build on the success of auto-enrolment and encourage women to start saving early and build up their contributions so they can build a strong financial foundation for themselves."

Adrian Lowcock, head of personal investing at Willis Owen, said: "The results are not surprising there are still a generation of households where men looked after the finances.  

"What is disturbing is the trend seems to continue right through all age groups. Whereas society has made some progress with regards to gender equity, financial services look to be lagging.  

"The reality is that whilst the financial services industry is very slowly waking up to the need to change how they interact with women, it is women who will continue to suffer.  

"It is therefore important not to wait for the industry to change but for women (in fact anyone) to take control their finances and invest for their future. Don’t be afraid to ask questions – we have already heard them all anyway."