Sam Neale, Director SN Financial.
In the past few years more and more has been in the public consciousness of the impact of the midlife challenges due to the menopause and perimenopause, this also plays out financially. It can have a detrimental impact on women’s finances due to a range of symptoms such as anxiety, depression, memory problems, joint pain, hot flushes, and fatigue. These symptoms can be debilitating, which can lead to women’s ability to work and potentially leading to job loss.
Experts advocate for greater recognition of the menopause’s impact on women’s lives and finances. One in 20 women who have gone through the menopause stopped working as a result of their symptoms, according to research by AJ Bell Money Matters, while one in 25 have reduced their hours.
A fifth of women say the menopause has impacted their confidence at work, while a further 12% say their performance suffered. Many more are forced to use holiday, sick days, or even unpaid leave while they go through the menopause to help them manage their symptoms.
Additional factors like switching to part-time or reduced hours have detrimental impact on the long-term retirement income.
There is not a single good reason why women should have less money than men. Baroness Helena Morrissey
‘Bridging the Gender Pension Gap’ report by Royal London, shows that on average menopause could reduce the amount women have in their pensions by £63,000 because they reduce their hours which, in turn, limits the amount they can save. If women stop working altogether, they could end up with eye-watering £126,00 less in their pensions than they’d have if they’d worked until State Pension age.
How to get ahead of the issues…..Speak to a professional planner
Our professional planners are qualified to find the best long term solutions for your circumstances, from finding the most cost-effective products for your needs to where to put your savings and pensions. A few things to consider when approaching this stage of your financial life.
Budgeting taking control of finances by creating a budget and saving regularly is recommended.
Clearing debts and building an emergency savings fund are important steps.
Consolidating pension pots It’s also advised to locate any lost or forgotten pension accounts and consider consolidating them for easier management. However, potential exit fees and loss of benefits should be carefully assessed. Increasing pension contributions, especially if receiving an inheritance or bonus, can have long-term benefits due to tax relief and the ability to access funds from the age of 55. Taking advantage of employer contributions in workplace pension schemes is also encouraged.
Full State Pension is currently £203.85 a week in 2023/24. However, the actual amount you’ll receive depends on your National Insurance record, so it’s worth checking whether you’re on track for the full amount.
Different people can be eligible for different amounts of State Pension and can be eligible from different ages. Fortunately, the government provides a free personal State Pension forecast to clarify these points for you. https://www.gov.uk/new-state-pension/what-youll-get
Seeking professional financial advice Speaking to a professional planner can help you to adjust your financial plans to take advantage of all options available to you, our team can help you.
Our team can help with making sense of the options available to you to ease your financial anxiety, one less thing to worry about.
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‘Bridging the Gender Pension Gap’ report by Royal London