Nav: Home

Some women's retirement plan: Rely on Prince Charming

June 21, 2016

Women workers often rely on future spouses to organize their retirement finances, rather than making independent decisions now. Men and women working for private Japanese companies make decisions about their retirement savings plans differently based on their gender.

Satoshi P. Watanabe, Ph.D., of Hiroshima University completed new research on an insurance company's survey results from 2002. Although the survey is somewhat dated, the data is still relevant because employee demographics have not changed significantly in the intervening 14 years. This is the first study to examine Japanese workers' gender-based decision making about retirement investments.

Even when women and men had the same comprehension of their retirement savings plan options, women were more likely than men to accept employers' automatic enrollment plans rather than to choose different options that would be better investments for their circumstances.

Previous research in the US and Japan identified a thought process common among women: regardless of my current relationship status, a man will eventually take care of my future or my retirement will just somehow work itself out.

Women believe that somehow, Prince Charming will arrange for their financial security in their Golden Years.

Men and women usually report that the ability to self-manage their investments is a positive attribute of retirement account portfolios. However, fewer women consider the responsibility that comes with self-management a positive attribute. The survey data reveal more women than men seem to be unwilling to manage their own investments.

The decision to not make decisions is a problem that compounds the disadvantages that women already face when building their retirements savings: women are paid less than men and often work fewer years, due to taking time out of the workforce for child-rearing. Additionally, women usually have longer retirements because they have longer average life expectancies than men.

Changes in 2001 to the Japanese national pension scheme gave individuals more retirement fund options, equivalent to 401k or IRA (individual retirement account) options in the United States. These changes might actually be detrimental to workers, particularly women.

The overall understanding of their retirement savings plan options is low for both men and women. Employer-provided retirement information seminars are often voluntary events that occur after work hours, when women are more likely than men to be busy with family commitments.

Women workers may be best served if employers provide retirement planning seminars during official work hours and if the national government created retirement plans that suited the investing behaviors of modern workers.

As the workforce becomes more dynamic with fewer permanent and more flexible contracts, individuals need retirement savings plans that do not rely on staying with one employer long-term. However, if workers are unwilling to independently manage their retirement accounts, then these self-management options may actually be detrimental to future generations of retirees.
-end-
Find more Hiroshima University research news on our Facebook page: http://www.facebook.com/HiroshimaUniversityResearch

Original Research Article: "Prince Charming Syndrome?" Gender Gap in Preferences for Defined Contribution Pensions in Japan (forthcoming), Journal of Women & Aging, 30(2), 2018.

Hiroshima University

Related Retirement Articles:

Over-55s shouldn't wait for retirement to make time for their health
People in middle-age need to keep up their physical activity levels if they are to enjoy a fit and healthy retirement -- according to a new report.
Sedentary time increases after retirement -- especially in women
The FIREA study, conducted at the University of Turku (Finland), revealed that the amount of sitting time increased in women after the transition to retirement.
Two-degree climate goal attainable without early infrastructure retirement
If power plants, boilers, furnaces, vehicles, and other energy infrastructure is not marked for early retirement, the world will fail to meet the 1.5-degree Celsius climate-stabilizing goal set out by the Paris Agreement, but could still reach the 2-degree Celsius goal, says the latest from the ongoing collaboration between the University of California Irvine's Steven Davis and Carnegie's Ken Caldeira.
Older people less anxious, more active and less likely to fall in retirement communities
A new report shows older people benefit from improved physical and mental health in retirement communities, resulting in cost savings to the NHS.
Financial illiteracy and irrational thinking are causing a dangerous shortfall in retirement savings
Since individuals do not make rational decisions in complex matters such as retirement planning, the researchers suggest an alternative behavioral approach.
New research presents alternative methods, like robo-advisors, to manage retirement income
The need to help retirees make prudent spending decisions has led to the growth of a large industry of financial advisors, but a new article suggests that improved policy approaches may be more effective.
Retirement transition increases sitting during free time
According to Finnish longitudinal cohort study, the amount of sitting during free time increases after transitioning to retirement.
Millennials are not adequately saving for retirement, MU study finds
In a new study, researchers from the University of Missouri found that only 37.2 percent of working millennials have retirement accounts, demonstrating a need for increased financial education for retirement.
Diabetes did not increase early retirement
A Finnish study examined diabetes and work loss due to early retirement during the work careers of approximately 13,000 people.
Duration of sleep increases and sleeping difficulties decrease after retirement
When people retire from work life, they sleep approximately 20 minutes longer than before retirement.
More Retirement News and Retirement Current Events

Best Science Podcasts 2019

We have hand picked the best science podcasts for 2019. Sit back and enjoy new science podcasts updated daily from your favorite science news services and scientists.
Now Playing: TED Radio Hour

Rethinking Anger
Anger is universal and complex: it can be quiet, festering, justified, vengeful, and destructive. This hour, TED speakers explore the many sides of anger, why we need it, and who's allowed to feel it. Guests include psychologists Ryan Martin and Russell Kolts, writer Soraya Chemaly, former talk radio host Lisa Fritsch, and business professor Dan Moshavi.
Now Playing: Science for the People

#538 Nobels and Astrophysics
This week we start with this year's physics Nobel Prize awarded to Jim Peebles, Michel Mayor, and Didier Queloz and finish with a discussion of the Nobel Prizes as a way to award and highlight important science. Are they still relevant? When science breakthroughs are built on the backs of hundreds -- and sometimes thousands -- of people's hard work, how do you pick just three to highlight? Join host Rachelle Saunders and astrophysicist, author, and science communicator Ethan Siegel for their chat about astrophysics and Nobel Prizes.