Seven financial must-haves for women in retirement

By Janice Roberts

Kerry King, Citadel Advisory Partner

Recent Statistics South Africa figures reveal that, on average, women outlive men by nearly a decade or 9.3 years. And this means that it is absolutely vital for women, if they haven’t already, to take an active role in managing their finances rather than relying on a spouse or partner, because they will need the skills at some point in their lives, says Citadel Advisory Partner Kerry King.

“Without having participated in managing your finances before, suddenly needing to take over the reins can be very daunting. And in these cases, it’s all too common to hear of women being hoodwinked by unscrupulous individuals who pretend to offer their assistance,” she warns.

“It’s crucial that you feel confident enough to do what needs to be done to ensure that your income will last your entire lifetime, and that you can enjoy your retirement years in comfort.”

With this in mind, she offers a simple financial checklist with some practical advice for women to ensure smooth financial sailing in their retirement:


One of your most important financial tools is a budget outlining your income and expenses. This will help you to understand your annual income requirements, as well as expenses where you could cut back.

“When you retire, you will be living off a defined lump sum. A budget will help you to better understand your actual needs and what you can afford to spend if your money is to last your whole life,” King notes.

Retirement can also represent a big emotional and lifestyle change after working an eight-to-five job for 30 years, she adds.

“Make sure that your budget allows for some space for your hobbies, whether you decide to take up tennis or golf, painting, cooking lessons, or even decide to work for charity. Doing the things that you enjoy will keep you young, motivated and often healthier.”


When looking for ways to trim your expenses, do not cut your medical aid membership.

“Many people in their sixties consider cancelling their medical aid as they often haven’t really needed it before, and it represents a large monthly expense in their budgets,” she notes.

“But what about when you turn eighty? No one knows what lies ahead, and medical bills can be exorbitant. Also remember that if you seek to re-join a medical aid scheme later, you may pay additional late joiner penalties, and face waiting periods and exclusions for pre-existing conditions.”


It’s absolutely vital to make sure that you and your spouse each have your own, separate bank account, emphasises King.

“If your spouse should pass away, all their bank accounts would be frozen, including a joint account. You could take a loan against your spouse’s estate from the executor, but getting the executor appointed can take between six to eight weeks, and if something goes amiss, even as long as three months.”

“In that case, you will need your own bank account with enough money to cover your living expenses for a few months, not forgetting debit orders such as your cellphone or DSTV account.”


Geysers burst, pets fall ill and vehicles occasionally need a little extra TLC, which is why it’s important to have a separate emergency fund with about three months’ income on stand-by for unexpected expenses.

“If all your money is tied up in a retirement annuity or pension fund, your income will be limited, remembering that you can only adjust the drawdown percentage on a living annuity annually,” King explains.

“This means that if you are earning R30,000 a month, an unexpected expense such as replacing your tyres for R12,000 is simply not affordable without falling into expensive debt.”


Many retirees fall prey to the mistake of being too conservative with their investments in retirement, gradually losing the purchasing power of their income over time as the cost of living rises.

King notes, “What buys you a hundred loaves of bread today may only buy you twenty loaves of bread in ten years. Keeping up with the cost of inflation is critical to maintaining your standard of living.”

This means that you need to keep a portion of your investments in inflation-beating assets such as equities or even hedge funds, as equities have consistently emerged as the best performing asset class over time even though the past six months have seen some fairly poor returns.

“Equities do tend to be riskier and more volatile in the short-term, but it’s important to remember that when investing you sometimes have to go through the troughs to reach the peaks,” she says.

“That said, marry your investments in riskier assets with lower-risk asset classes such as cash and bonds which will smooth your returns. These types of short-term assets also offer the benefit of greater liquidity, allowing you to easily access your capital in case of an emergency.”

Depending on the performance of your investments, you may then need to cut back slightly more one year, or may be able to afford a treat such as an overseas holiday the next.


Reread your will at least every two years to ensure that the assets you are leaving behind are still relevant, and that your executor is up to date.

You will also want to review your need for life cover, as many retirees have already paid off their debts and accumulated enough wealth to leave an inheritance for their loved ones, so the need for life cover may diminish with age.


However, before taking any decisions on life insurance, it is advisable to consult a professional wealth planner, as you may have assets that can’t be easily liquidated such as property, or may want to cover the amount that would be payable for estate duty.

A wealth planner will also be able to advise you on the structuring of your investments, for instance by making sure that any trusts remain compliant with changes in legislation and that trustees are aware of any regulatory changes.

“Finally, a professional wealth planner will be able to offer you valuable advice and assistance in successfully managing your retirement income and investments, ensuring that you remain financially secure and comfortable for your whole life.”

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