20 percent. Women earn so much less on average than men in Germany. The consequences of this gender pay gap – the difference in earnings between the sexes – are often felt particularly strongly by women in old age, when the pension is insufficient.
The pay gap is not the only reason women have to start worrying about their financial security in old age earlier. Because in addition to the lower total lifetime income, they also have a higher life expectancy than men.
So how much money should women have saved at the age of 30, 40 and 50 in order to be financially secure in old age? On Women’s Equal Opportunities Day, the financial platform Weltsparen examined how many 30- to 60-year-old women would have to be on the high edge compared to men in order to be equally well positioned in retirement.
To this end, the platform analyzed average salaries in different age groups and calculated their likely pension gap. The data comes from the Federal Statistical Office, the German pension insurance and the pension forecast calculator Fairr-Cockpit.
The graphic shows (column on the far right) how much you should have saved at what age:
A 30-year-old woman should have saved that much by now
The average gross income of a 30-year-old woman in Germany is 40,189 euros per year. This corresponds to a monthly net salary of EUR 2,062 and results in a statutory pension entitlement for an unmarried woman without children of around EUR 1,250 per month. This means that an average of 800 euros a month is missing in old age in order to maintain the standard of living. With an average of 17 years of pension drawing, this results in an extrapolated amount of 163,000 euros taking inflation into account. If a 30-year-old puts back ten percent of her income by the time she retires, as many financial experts recommend, she could still save around 111,000 euros. That means that a 30-year-old woman would have to have around 52,000 euros in her account today to close the remaining gap.
For comparison: A man of the same age would have to have saved only 16,000 euros to date in order to be able to maintain a comparable standard of living in old age. With an average monthly net salary of 2,577 euros at the age of 30, the statutory pension entitlement is, according to current forecasts, 1,525 euros. This results in a pension gap of 155,000. Since men generally have a lower life expectancy, only 12 years of pension payments are calculated here. If the 30-year-old were to save ten percent of his monthly net salary, he would still be able to save 139,000 euros. Since he will earn more over the years than the woman used for comparison, he must have saved less at this point in time.
A 30-year-old has to save a third less than a woman of the same age without children.
How can women secure their pension financially?
The Weltsparen portal recommends women to think about a long-term investment at a young age in order to save the equity they need for old-age provision more efficiently. One possibility are ETF savings plans. If a 30-year-old now puts ten percent of the current net salary every month – let’s take the around 206 euros from the calculation example – in a savings plan with an average return of 5 percent, she could save a total of 264,000 euros by the time she retires at 67. This would cover the pension gap.
The Weltsparen portal has also carried out these calculations for other age groups. You can find more information on the methodology and the sources of the survey here.