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Source: MIL-OSI Submissions

Source: ASB

Despite a 9% gender pay gap, Kiwi women have better everyday financial wellbeing than men, as they spend less and save more.
Despite saving more, women’s KiwiSaver balances are 12% lower at retirement due to lower pay and less appetite for risk.
If Kiwi women invested their additional bank savings in the right KiwiSaver fund for their goals, they could collectively unlock three quarters of a billion more at retirement.

Financial data from more than half a million ASB personal banking customers has revealed that on average Kiwi women are 2% financially better off day to day than men. This is despite earning 9% less on average, as men erode their pay advantage by spending 8% more.

Developed with the University of Melbourne’s Institute of Applied Economic and Social Research, the ongoing ASB study of spending, saving and credit behaviour gives insight into New Zealanders’ financial wellbeing, analysing the extent to which Kiwis have financial freedom, security and control.

ASB customer data for the year to 31 May 2021 demonstrated women trump men on all saving measures studied. They’re more likely to have a savings account and typically hold $600 more in savings. One in three women had at least $10,000 set aside and the study also showed fewer women live payday to payday, miss payments or fall into unarranged debt.

While women fared well on everyday money measures, ASB cautions this is not the full story, as the gender divide reverses when it comes to retirement savings. Analysis of ASB KiwiSaver Scheme data shows women withdrawing from their KiwiSaver at retirement have balances 12% lower than men. Women not only earn less on average, but typically take more time out from paid work through maternity and family commitments, which impacts earnings, KiwiSaver contributions and ultimately retirement balances.

ASB found that on average women hold more in savings in the bank than men, but they’re not capitalising on this advantage long term. Projections show that if these additional savings were invested in an appropriate KiwiSaver fund, women aged 35-65 could collectively boost their retirement funds by around $750 million.

ASB Chief Executive Officer Vittoria Shortt said while it’s remarkable to see how resourceful Kiwi women are with less, having a long-term plan is fundamental to a healthy financial future.

“ASB’s independent Investor Confidence and KiwiSaver surveys tell us women rate their knowledge of investing far lower than men and are more likely to be in the most risk-averse KiwiSaver funds, regardless of their personal circumstances or goals, which can mean they’re missing out on investment gains over time,” Ms Shortt said.

“Our study makes it clear that what we do with our money has a greater impact on financial wellbeing than income alone. Setting money aside for tough times is the most important thing Kiwis can do to improve their immediate financial wellbeing, but longer-term planning is vital too.

“Knowing where to start is key. ASB has made it easier for customers to assess their financial situation, set goals and take practical steps to reach them, with specialist advice and support available through our smart digital tools, expert banking advisors and KiwiSaver specialists.

“ASB is here to support Kiwis towards a better financial future, and we encourage customers to speak with us about how we can help them make the most of their money – today and tomorrow.”

Notes:

ASB’s financial wellbeing research was developed in collaboration with the Melbourne Institute: Applied Economic & Social Research. Financial wellbeing data is captured from customer transactions on ASB held banking products and will be shared with media quarterly. All data is anonymised and aggregated to protect the privacy of customers. The research looks at customers whose main banking relationship is with ASB (where main-bank is internally defined).

ASB’s tool to help Kiwis understand their own financial wellbeing is available on its website. This 10-question survey asks about recent and past financial experiences and generates a personal financial wellbeing score of between 1 and 100. Responses and results from the tool are anonymous.  

MIL OSI