The New Social Contract: Achieving Retirement Equality For Women

Globally, less than a quarter of women workers believe they are on course to achieve their retirement income needs. A new report provides actionable recommendations to put women at the center of the solution.

Entitled The New Social Contract: Achieving retirement equality for women, the report finds that the persistent gender pay gap coupled with traditional societal norms and gender roles are placing women at a disadvantage in terms of saving and planning for retirement.

The findings of the report are based on an annual survey of 15 countries spanning Europe, the Americas, Asia, and Australia. It is a collaboration between Aegon Center for Longevity and Retirement (ACLR), and nonprofits Transamerica Center for Retirement Studies® (TCRS) and Instituto de Longevidade Mongeral Aegon.

Women today are better educated entering the workforce than any other time in history. However, parity in education is not translating into equality in employment. This puts women at a disadvantage throughout their careers and at risk when it comes to achieving retirement security, Mike Mansfield, Program Director at the ACLR.

Women’s retirement readiness is stubbornly low

The report finds that globally only 21 percent of women workers believe they are on course to achieve their retirement income needs. And, only 26 percent of working women across the globe are extremely or very confident they will be able to retire with a comfortable lifestyle.

Mike Mansfield, Program Director at the ACLR

Women are at a disadvantage throughout their careers and at risk when it comes to achieving retirement security.

Mike Mansfield, Program Director at the ACLR

The Aegon Retirement Readiness Index (ARRI) measures preparedness on a scale of 0 to 10. In 2019, women workers globally achieved a low ARRI score of 5.8, up from 5.5 in 2014.

With the exception of the UK and Germany, women in all other European countries in the survey, as well as Canada, Australia and Japan, score below average.

Aegon Retirement Readiness Index

The life course of women fundamentally differ from those of men. Societal norms and expectations, like marital norms, childbearing, family responsibilities, and caregiving responsibilities, often create very real barriers for women and their ability to be self-reliant and prepare for their long-term financial security. Women are more likely than men to take extended periods of time out of the workforce, thereby limiting both their ability to save, and foregoing the wider benefits that can come with employment.

The five fundamentals

The report provides actionable recommendations outlines a holistic approach to retirement planning based on these five fundamentals for retirement readiness:

  1. Start saving early and save habitually

  2. Develop a written retirement strategy

  3. Create a backup plan for unforeseen events

  4. Adopt a healthy lifestyle

  5. Embrace lifelong learning

It provides comparisons with men and a detailed set of recommendations for policymakers, industry, employers, and women. For instance, the report recommends employers broaden women’s access to workplace retirement plans, by extending these plans to also include those working part-time and zero-hour contracts.

Global retirement research

Aegon’s purpose is to help people achieve a lifetime of financial security, both up to and through retirement. For the last eight years, we have been conducting the Aegon Retirement Readiness Survey. This survey covers 15 countries, spanning the Americas, Europe, Asia, and Australia.

The resulting reports are designed to raise awareness of the retirement-related risks faced by workers and provide insights and recommendations for individuals, employers, and policymakers. They are a collaboration between Aegon Center for Longevity and Retirement (ACLR) in and nonprofits Transamerica Center for Retirement Studies® (TCRS) in the United States and Instituto de Longevidade Mongeral Aegon in Brazil.

The New Social Contract: Achieving retirement equality for women builds on The New Social Contract: Empowering individuals in a transitioning world (2019) and Women: Balancing family, career & financial security (2014).