Women’s Retirement Planning South Africa: How to Close the 21% Retirement Gap

South African women reportedly retire with 21% less in retirement savings than men. This gap is not caused by a lack of financial ability. It often develops because women balance careers, caregiving, family expenses and the needs of others while postponing their own financial goals.

Effective women’s retirement planning in South Africa requires women to understand their current financial position and make their long-term security a priority.

Why do women often retire with less?

Several factors can affect how much a woman accumulates for retirement:

• Career breaks or reduced working hours

• Caring for children or extended family

• Unequal earning opportunities

• Lower or interrupted retirement contributions

• Divorce, widowhood or changing household income

• Longer life expectancy

Even a short interruption in retirement contributions can reduce the potential benefit of long-term compound growth. The sooner a possible shortfall is identified, the more time there is to address it.

Women’s Retirement Planning in South Africa: Where Should You Start?

Many people contribute to a pension or provident fund without knowing whether it will provide enough income during retirement.

Start by asking:

• How much have I saved?

• Am I contributing enough?

• What income could my savings provide?

• When can I realistically retire?

• Is my investment strategy suitable for my goals?

• Do I have previous retirement funds that need attention?

A financial planner can review your retirement savings, investments, insurance and financial responsibilities to identify potential gaps.

Consider the right financial tools

Different financial products can play different roles in a long-term plan.

Retirement annuities

A retirement annuity, or RA, can help employees, business owners and self-employed women build additional retirement savings. Contributions may offer tax advantages, depending on current South African tax legislation and individual circumstances.

Tax-Free Savings Accounts

A Tax-Free Savings Account can complement a long-term investment strategy. Qualifying returns are exempt from income tax, dividends tax and capital gains tax.

From 1 March 2026, the annual TFSA contribution limit is R46,000, while the lifetime limit remains R500,000. Withdrawals do not restore contribution allowance already used, making a TFSA generally more effective when treated as a long-term investment.

The Two-Pot Retirement System

South Africa’s Two-Pot Retirement System allows qualifying retirement fund members limited access to part of their retirement savings before retirement.

While this may assist during a genuine financial emergency, withdrawing can reduce future retirement income and sacrifice years of potential investment growth. Tax and administration costs may also apply.

Balance family needs with your financial future

Many South African women support children, parents and extended family while trying to save for retirement.

However, sacrificing your retirement plan to meet every current family expense can create financial dependence later. A more sustainable financial plan could include:

• A realistic household budget

• An education savings plan

• An emergency fund

• Consistent retirement contributions

• Appropriate life and disability cover

• An updated will and estate plan

Creating generational wealth is not only about leaving assets behind. It also means building enough financial security to avoid depending on your children during retirement.

Prepare for major life changes

Marriage, divorce and widowhood can significantly affect a woman’s financial position.

Women should understand their marital property regime, household assets, debts, retirement funds, insurance policies and beneficiary nominations. Important financial information should never be known by only one person in the household.

Financial independence does not mean excluding a partner. It means having sufficient knowledge and access to participate confidently in decisions that affect your future.

Five practical steps to take now

You do not need to solve everything immediately. Start with these actions:

1. Calculate your current retirement savings.

2. Review your monthly retirement contributions.

3. Check your investment fees and performance.

4. Build or replenish an emergency fund.

5. Arrange a personalised retirement needs analysis.

Small, consistent improvements can be more effective than waiting for the perfect time to begin.

Put your financial future back on the list

Proper Group provides independent financial planning services tailored to each client’s circumstances, goals and risk profile.

Whether you are investing your first salary, returning to work after a career break or reassessing your retirement strategy, Proper Group can help you identify potential shortfalls and take a more structured approach to retirement planning.

Speak to Proper Group about reviewing your retirement and investment strategy.

This article provides general information and does not constitute personalised financial, investment, tax or legal advice.

Frequently Asked Questions

Why do women often retire with less than men?

Career interruptions, caregiving responsibilities, income differences and lower retirement contributions can reduce the amount women accumulate before retirement.

How can South African women improve their retirement savings?

Women can review their existing retirement funds, increase contributions where affordable, avoid unnecessary withdrawals and obtain financial advice suited to their circumstances.

Can a TFSA form part of a retirement strategy?

Yes. A Tax-Free Savings Account can complement retirement investments, but contribution limits apply and unnecessary withdrawals may reduce its long-term value.