How Couples Can Achieve Financial Equity in Retirement Plans

Excerpts from the lecture by our colleague, Claudia Liese at the “get together” in the Weiberwirtschaft on September 25th, 2020

In my initial counseling sessions at the finanzkontor, I always notice that many women do not take care of their finances well enough or not at all. How is it with you?

In fact, I have the impression that more than half of women do not care at all, or do not care well enough, or too late.

Why is that? Are there perhaps fears of contact / beliefs that are acquired, such as the opinion that a man who earns well or better already takes care of the woman or does a woman simply have so much to manage that she simply cannot look at her finances?

In the consultation, it often turns out that some of the women’s assumptions are unfortunately incorrect. For example, it is a fact that in the case of a couple without a marriage certificate, after the separation of the partners, there is no statutory pension or asset equalization because there was no marriage. If the woman has taken on a large part of the childcare here and has perhaps even given up or shortened her job for it, she definitely gets the short straw.
There are hardly any pension entitlements and often the train has also left the job.

Now you are probably wondering what can I do better? Should I even get married because of that?

From my point of view, a marriage should first and foremost be a decision made by the heart and only later a strategic decision. It is not absolutely necessary. But you should, dear women, come up with a clear concept if you live in a partnership, i.e. without a marriage certificate, above all with children. Be sure to talk to your partner about finances! What does he / she have, what do you have? How can you be cared for when you look after the children or the household or relatives. Please allow yourself to be compensated!

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How does it work?

This is possible with a partnership agreement in which they regulate in writing what they want to compensate, for example you pay me 150 euros a month into my private pension insurance so that I can get a good pension later. In the partnership agreement, you can also regulate what should happen in the event of a separation. Here you take advantage of the good relationship and willingness to cooperate in good times. Because you surely know that once a specific thought is given about separation or even a separation takes place, the basis for negotiation is completely different.

In the partnership agreement it can be regulated, for example, who takes care of the children or who is allowed to keep the rented apartment up to who takes care of the pet they have bought together. That might sound a bit funny now, but in an emergency it can be a great relief!

There is another point why women as well as men neglect the finances and from my point of view these are not so much the beliefs as actually the subject of “Schieberitis” – you know that? I think you know that. You push and push because you think there are always more important things / issues to do.

I also know it from my everyday life, such as the idea of ​​finally sorting my many digital photos and oops every year nothing happens with it, not this year either, unfortunately. But it is definitely not so bad to push this topic because I will find a certain photo after a long search – it is there.

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However, it is actually different with old-age provision, protection or asset accumulation. This can have significant consequences. I would like to give you a small example: Two women are starting to save 150 euros a month until they are 65 years old. The assumed return is arbitrarily chosen by me at 4%, e.g. through fund savings. One woman starts saving at the age of 25, the other 5 years later, i.e. at the age of 30.

The fortune of the second woman amounts to 135,500 euros after 35 years and the fortune of the woman who started saving at the age of 25 amounts to 174,700 euros after 40 years, i.e. almost 40,000 euros more for five years longer save. That’s a lot, isn’t it ?! It clearly shows that it’s worth starting early.

What do you think you get when you start at 40 and up to 65, that is, 25 years in total? Then you can count on around 75,600 euros.

Dear women, especially when you are reorganizing or reorienting yourself professionally, you put all your energy, time and thoughts into your own work project. Just forget that here in Germany you have to do something in advance for your retirement in order to be able to live adequately in old age.

The pension level for white-collar workers was reduced from 52.9% in 2004 to 47.6% in 2020 and is expected to decrease even further. This means that at the moment you receive less than 50% of your earnings as a pension if you have worked for a lifetime. 80% of your last earnings would be desirable in order to enjoy a contented retirement. So it is very clear that the pension will not be enough! While men today earn an average of 1,148 euros monthly pension, women receive an average of only 711 euros.

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You are now wondering when is the right time to start and I can tell you: NOW – exactly NOW! Every little thing you take into account really counts, the main thing is that you address the issue. The later you start with monthly savings, the more you have to put back and that is often not possible later on in the same order of magnitude! This was shown by our example earlier!

The topic of coverage, e.g. against disability, is extremely important in order to maintain the basic noise in your household bills, in times when you are suddenly faced with an unforeseeable event.

My appeal to you is: Be sure to seek advice from experts! There are enough offers!

I am often asked how I recognize good advice: From my point of view, there are six essential points that you should pay attention to:

  1. Recommendations, is there someone from your circle of acquaintances / friends / family. Do not rely on review platforms – they are often not neutral, but rather use your personal network
  2. Transparency, here it should be explained exactly how the consultation will proceed and what costs you will have to face
  3. holistic view of your situation, your entire life plays a role, your wishes and goals, your health, your current financial situation, your family situation, your job, etc.
  4. no one is pushing you to close a deal
  5. solvent offers where the risks are explained to you
  6. the counselor should be empathetic and they should understand the recommendations or the explanations of the counselor should be easy to understand.

I would like the topic of women and finance to become more easy and natural!

My book recommendation to you:

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