Buy online
32 million women call South Africa home. They are taking control of their wealth, starting businesses and becoming the 21st century’s leading entrepreneurs. But despite their progress, they earn less than their male counterparts, carry a heavier burden of unpaid care responsibilities and experience higher levels of financial stress. This Women’s Month, Kobus Wentzel, Group Distribution Executive at 1Life Insurance and Clientèle, shares five conversations you can have with your clients to help them take control of their financial futures.
Let’s talk about your potential life cover gap
Help your clients assess their life cover and long-term insurance needs so they can take care of their family’s future
The 2022 ASISA Gap Study found that women were underinsured for life and disability cover, slightly more so than men. On average, a woman needed R1.67 million life cover and had only R671 000, leaving a gap of around R1 million. Closing the life cover gap would cost around 4.9% of current earnings. The disability insurance gap was around R1.3 million, which would cost 2.7% of current earnings to close. Without closing the insurance gap, families would need to reduce expenses by over 30% if the income earner passed away or suffered a disability. Alternatively, to maintain their standard of living, families would need to find an additional R5 630 per month in the event of death, or R7 443 per month in the event of a disability.
Keep in mind that these gaps don’t account for unpaid work and lower earnings. Women earn around 25% less than men in South Africa for similar work, and their home and caregiving tasks are often not remunerated, such as caring for children, cooking and cleaning. Estimates of the value of unpaid work range from 10% to 39% of GDP. Taking a middle point of 15% of GDP, this adds at least R32 000 a year in value for unpaid work, which may well become a line item in the budget if a woman passes away and could mean the life cover gap is larger than expected.
How long will your retirement income last?
Help your clients save enough for retirement, taking longer life expectancies into account
South Africa’s average life expectancy for women is around 5 years higher than men. According to World Bank data, a 60-year-old South African woman can expect to live another 19.7 years, compared to 15.9 years for a 60-year-old man. Women need more money for retirement. Are your clients’ financial plans taking longer life expectancy into account?
A US-based study found that women retire with 30% less than men. Locally, the 2023/24 10X Retirement Reality report found that 49% of women in South Africa do not have a retirement plan. Even more alarming was the finding that of those who did have a plan, only 11% said they were sticking to that plan. In addition, a recent study found that only 33% of women believe they will be financially secure in retirement.
Have you got access to funds in the event of your partner’s death?
Ensure your clients have access to cash to pay the bills when their life partner dies
Women often face a liquidity crisis when their partner dies. Joint accounts are frozen, access to funds denied and without their own source of income, bills mount up. While there are ways to access funds, these can be cumbersome and time-consuming. Consider, for example, the delays at the Master’s Court for the winding up of an estate.
You can help your clients avoid this by ensuring they have bank accounts in their own name and a source of income while the partnership’s financial affairs are finalised. Products designed to meet these needs such as the 1Life Wills and Estate Plan can also ensure access to funds and provide liquidity for estate costs.
The best way is with a will
Help your clients draft and/or review a will and estate plan
Your clients need a will if they own property and to make sure their beneficiaries or heirs inherit as they intend. Wills can also specify care for minor and dependent children, such as setting up a testamentary trust and naming a guardian.
Let your clients know that they don’t need a large net worth for a will, it serves other purposes such as ensuring loved ones are cared for.
You can also help your clients by planning their estates, such as by ensuring there is liquidity for expenses while the will is being wound up.
Top tip: Make sure your clients have named beneficiaries on all life policies, retirement and pension fund savings and any discretionary investments. These can ensure families have funds and the estate has liquidity.
Become financially responsible and independent
Work with your clients so they set financial goals and have their own financial plan
A man is not a financial plan! Women work, earn and manage homes but in many cases don’t take an active role in planning the family’s finances, especially long-term plans like insurance and investing. They also have a disproportionately high level of financial stress. The DebtBusters 2025 Money-Stress Tracker found that 73% of women are financially stressed, a higher number than men, and recent retirement fund research found that 50% of women feel that financial stress is affecting their mental health compared to 35% of men.
Encourage your clients to learn more about managing money wisely, have their own financial plans and sources of income. Make sure they are adequately insured and where necessary insured for their own needs such as dread disease policies specifically for women. You can also do a value calculation on the unpaid work women do, such as cooking and cleaning, as well as caring for children and older relatives, so this is quantified and added to the life insurance sums assured when setting up and reviewing financial plans.
It’s a woman’s world
57% of South African women identify as entrepreneurs and 71% are interested in owning their own business, according to MasterCard research. That’s a lot of potential clients who are actively looking to master their money. The article: Why advisers better get ready for more women with money shares insights into wealth shifts and has tips for advising women on their financial plans.
Final thoughts
Women need their own financial plans to become financially independent. Known to be more conservative investors, women have all the skills to manage money well and grow their wealth. Financial advisers can guide them on this journey, gaining clients for life, with appropriate advice and recommendations to make sure they achieve their financial goals.