Women receive around 630 euros less in pension per month than men. Why this is the case – and how you can take precautions early on.
March 6th is . The day is intended to remind us of the wage gap that still exists between men and women. The gender pay gap, the average difference in pay between men and women, is 18 percent. Calculated differently, female employees would work unpaid for 66 days a year if they earned the same amount as men in the remaining time – until March 6th.
Far less well known, but even larger, is the gender gap in retirement provision. The so-called gender pension gap means that female pensioners have around 30 percent less pension available in old age than their male counterparts. That reports that. You only receive 17,814 euros or 1,485 euros gross per month, while pensioners receive an average of 25,407 euros. Without survivors’ pensions, the difference is even higher: 42.6 percent. If there were an “Equal Pension Day”, it would take place on April 20th or, without a survivor’s pension, only on June 3rd.
Mothers are almost nine times more likely to work part-time
The pension gap is based on the same reasons that cause the gender pay gap in working life: women often have more interrupted employment histories than men, tend to choose professions with lower incomes and pursue other careers. They are more likely to take care of child-rearing and care, and to do so they reduce their working hours or even stop working altogether: the part-time rate among female employees is 47.4 percent. Among men, only 10.6 percent work part-time. If you reduce the analysis to fathers and mothers who live in the same household with their children, the difference is even larger: 64 percent of mothers work part-time, while the figure for fathers is only 7.3 percent.
There is also a structural salary difference: with comparable qualifications and work, women actually earn around 7 percent less than their male colleagues. This gap is also called . Women with a migrant background in particular are apparently discriminated against when it comes to salaries. Studies on the subject are rare, but according to one from 2008, foreign women earn another 20 percent less than those born in Germany.
Because women earn significantly less than men, they also pay less into the statutory pension and save less in private pension products. This means they have less money available as they get older. One in five women over 65 (20.9 percent). Among men it was only one in six (17.5 percent).
Balance child-rearing times
The Gender Pension Gap quantifies the pension income per person, but not the joint household income. So it may be that couples who live together as they age feel the gap less. Married people who get divorced are entitled to a so-called pension equalization. For this purpose, pension entitlements from statutory and private pension insurance that were acquired during the marriage are divided equally between the divorcees. To do this, the marriage must have existed for at least three years.
However, some marriage contracts generally exclude pension equalization. Unmarried couples also have no claims. It can therefore make sense to think about pensions when it comes to childcare. One method, for example, is to introduce a private provision equalization during parenting time: the full-time partner in the relationship pays compensation to the person who works part-time or not at all, so that this person can make private provisions.
In purely mathematical terms, this should be at least the amount that the former full-time employee misses out on from their statutory pension while working part-time. After all, the statutory pension insurance generally recognizes three years of child-rearing time, so at least in this period the gap should not be too large. However, this compensation payment does not reflect a career break and thus lost wages. It is therefore entirely justified to pay a higher amount.
Benefit from the compound interest effect when planning for retirement
One way to make provisions for old age is with an ETF savings plan based on one or more broadly diversified index funds. The MSCI World All Country World Index, for example, includes the largest stock exchange listings from 23 developed and 24 emerging countries, so savers can cover a large part of the stock market with just one product. The so-called compound interest effect can also work until you retire: if interim profits are reinvested, the investment amount increases exponentially in the long term.
For example: Anyone who has invested 200 euros a month for 25 years will have saved 60,000 euros in the end. With a return of 5 percent annually, the investment amount increases by 57,647 euros to a total of 117,647 euros via the reinvested return. help you calculate your own savings goal or the necessary savings rate.
Source: Stern
