It is well documented that women often report feeling less confident than men when it comes to managing their finances. This continues to be the case, despite the fact that Irish women are having a growing influence on the economy, with rising levels of female entrepreneurship and greater representation at senior levels of businesses across Ireland.
“I am proud to say at AIB, three women lead our revenue-generating business areas,” says Geraldine Casey, managing director of retail banking at AIB. “In addition to my role, Cathy Bryce is managing director of AIB capital markets and Hilary Gormley is managing director of AIB UK.”
The level of female participation in the workforce has reached a new record since Covid, likely because of an increase in flexible working. Indeed, the latest AIB economic forecast shows the female participation rate in the labour market surging since the pandemic, rising to 60.4 per cent of the working-age population in final quarter of 2023, from 56.4 per cent for the same period in 2019.
However, some stark financial disparities persist, one being the gender pension gap.
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“In Ireland it stands at 35 per cent and, to put it in real terms, this means that the average total income in retirement is €280 a week for women as opposed to €433 for men,” says Casey.
She believes the gender pension gap can be attributed to a number of factors, including the gender pay gap, the high representation of women in lower-paid employment without an occupational pension scheme and the fact that the majority of women still assume primary caregiving roles in families and therefore rely on flexible working, maternity leave, parental leave and career breaks, which impact on their overall lifetime pension contributions.
The pension gap is also compounded by the fact that the average life expectancy for a woman is 84 years, compared to 81 for men, which means women need their pensions to last longer.
“With Irish women forecast to hold 45 per cent of assets under management by 2030, we want to support women to feel more confident about managing their financial health,” says Casey. “It is important from a gender equality perspective that women are empowered to control their finances to ensure financial independence for themselves and their families in the long run.”
Earlier this year AIB developed a campaign to highlight the Gender Pension Gap and to urge women to review their finances to ensure their long-term financial security. Filmed in a busy Dublin cafe, AIB’s Female Serve saw women react as they were offered a coffee that was 35 per cent smaller than the traditional serving to demonstrate how the gender pension gap means they are likely to have a smaller pension income than men in retirement.
As customers ordered their daily coffee, the team at the cafe offered them the “female serve” as an option.
“Reactions to this exercise varied from shock to outrage and even some small levels of acceptance, with male customers in some cases stepping in to support their female acquaintances,” says Casey.
“Despite the fact that a fairer pension system is imminent, with measures including auto enrolment due in the next year, the gender pension gap remains a significant challenge for women in long-term financial planning.
“There is a role for everyone in addressing the issue, including policymakers, employers and financial advisers – men, as well as women. It’s also important for women to plan and seek guidance on how to build their financial future, as doing so now can help ensure that they live a full life in retirement.”
For more information on making a financial plan for the future visit aib.ie/make-a-plan