There is an increasing trend for young couples to manage their money separately, unlike previous generations who pooled their financial resources. Women are becoming more financially independent, which is great, however there are a number of factors which mean that women lag behind men in the wealth creation stakes.

Despite the push for greater pay equity, women still earn on average around 9% less then men. Female-dominated occupations still have lower rates of pay and research has shown that men have a much better track record at negotiating higher starting rates of pay and pay rises. Many women take time out from the work force to look after children, which impacts on career progression and future income as well as their ability to save.

Women tend to be more adversely affected than men when relationships break down. Their lower earnings mean that it is more difficult for them to recover from an asset split and they are more likely to be left with young children, creating a financial burden which is not always fully covered by child support.

Lower earnings and time off work both have a negative effect on KiwiSaver contributions, which are a percentage of earnings. The ANZ bank recently estimated that the average 25 year-old woman is likely to retire with about $125,000 in KiwiSaver compared with $223,000 for a male. While this might not matter so much if couples combine their retirement savings, it is certainly an issue for single women and for women who manage their financial affairs separately from their partner.

In the long term, the issue of pay inequity will hopefully disappear, but for now, women need to plan ahead to make sure their retirement savings are on track. This may mean making additional contributions into KiwiSaver or another long-term savings product.