While the looming crisis of inadequate retirement income threatens to increase senior poverty across society, women, particularly single women, are among the most vulnerable according to a new report from the Healthcare of Ontario Pension Plan (HOOPP).
In the second part of a series of articles to “deepen the conversation around retirement security and to bring awareness around the benefits of defined benefit (DB) pension plans,” HOOPP explores how women will be disproportionally affected by the crisis of not having enough income during retirement.
The article, Women at Greatest Risk of Poverty in Senior Years, reveals that a number of factors combine to reduce retirement income, such as: women are more likely to work part-time hours, thereby accumulating less pensionable hours; the pay gap has them earning 70 cents to every dollar earned by men; and they live longer than men, necessitating more retirement income.
The numbers, states the report, tell the tale. Canadians aged 55-64 have, on average, just $3,000 in retirement assets, and one in three Canadians feels unprepared financially for retirement.
“Canadian women, in particular single women, will be disproportionately affected by poverty when they reach their senior years. Unfortunately, despite decades of gains in the workplace, women now face greater economic instability heading into retirement than do men – and they face a much steeper climb to financial security,” reads the article.
Women are much more likely to outlive their savings and their spouse, according to the report, which leaves them “having to save more than men for their retirement years, at lower salaries and with less time spent in the workplace.”
Looking at longevity stats, there are twice as many women as men over the age of 85. As for being over 100, there are five times as many women than men in this area. Also, 30 per cent of senior women live in poverty, versus 26.3 per cent of men.
There is a bright spot in all of this, the report tells us. Working women are more likely to have a defined benefit pension plan than men.
“Pension coverage can play a role in alleviating poverty for Canadian seniors – women in particular. However, as DB pension coverage shrinks in Canada, the financial picture for women in retirement will only darken,” the report continues.
Recommendations for policymakers are offered.
“The Canadian pension system needs attention and care. We stated this in our last paper on Senior Poverty in Canada and we restate it here. Canadian women in particular would benefit from a workplace pension safety net that recognizes and responds to the risks that leave women vulnerable to financial instability in retirement.”
Policymakers are called on to:
• Ensure adequate income replacement.
• Risk share.
• Make it automatic and mandatory.
“Workplace pension savings plans must be mandatory. Employers must offer them and employees must join and make automatic contributions at realistic levels,” HOOPP recommends.
• Find ways to pool.
• Make decumulation easier.
“Canadians should have access to a one-stop option to retirement savings that leads directly to decumulation, rather than leaving it up to individuals to decide how much to withdraw each year and how to invest the remaining money so it lasts. This is key to ensuring stable and consistent income in retirement.”

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