2004-04-16 21:23:03 UTC
The Prince Charming syndrome
Most women outlive men. But many still rely on males to provide for them in
their later years, as DIANA McCURDY reports
Cinderella and Snow White have a lot to answer for. All those years of young
girls devouring saccharine fairy stories have had an unexpected side effect.
In a phenomenon colloquially dubbed "Prince Charming Syndrome", a British
report has found that 20 per cent of women aged 18 to 34 rely on their
husband or partner to provide for them in retirement.
The trend, which has left financial advisers pursing their lips in dismay,
is not restricted to Britain. Statistics indicate Kiwi women are equally
prone to hoping providence will take care of the future for them.
According to one financial model, by the time the average 15-year-old New
Zealand girl reaches retirement, she is likely to have saved only 75 per
cent as much as her average male counterpart.
And who can blame her? In the intervening 50 years, she will probably have
faced multiple disadvantages, including a student loan (women take almost
twice as long to pay off the cost of a bachelor's degree), lower lifetime
pay, and taking time out to raise children.
Even the experts acknowledge that Prince Charming Syndrome is not entirely
Auckland University sociology professor Maureen Baker takes a pragmatic
approach to the trend. Like it or not, she says, finding a long-term earning
partner is "the most effective way that women can protect themselves in
"It's logical, it's not stupid, because women on their own cannot earn the
By the end of last year, total average hourly earnings of women were 85.4
per cent of those of men. Income gaps are larger for Maori and Pacific
It seems little wonder some women find solace in a dream of domestic bliss.
The trouble is that relying on a man is not a guaranteed investment as far
as retirement schemes go. "It's logical, but not reliable," Baker says. "You
can count on winning the lottery - that's a low probability - or you can
count on a man staying with you for life, which is a medium probability.
"Realistically, it's not stupid ... Close to 40 per cent of marriages don't
last, which means 60 per cent do."
But if you do divorce - and let's face it, 40 per cent is not a figure to be
sniffed at - it sets women even further back.
Divorce affects both parties financially. Men, however, usually bounce back
faster than women, especially if they are reaching middle management or
beyond. "A woman who's left with children might have received money from her
ex-husband, but that won't last long."
The best way for a woman to protect herself from the vagaries of divorce is
to have her own earned income, Baker says. She advises women to start
thinking about personal savings at 30 or 35 and keep close control over
their savings. Personal assets - and the family home - should never be
placed in jeopardy by business ventures.
"It seems to me that a full-time job for most of your life is essential - a
full-time job with a decent future and promotional opportunities and a
Most importantly, no matter how in love you are, never operate under the
assumption that you will be with your partner forever, she says.
Women in Super chairwoman Louise Gibson is a little more sceptical about the
concept of Prince Charming Syndrome. Most New Zealand women have moved
beyond such notions, she says.
In saying that, however, she believes most young women still have a fairly
distorted view of what retirement will be like.
"In reality, if we stopped women in the street and asked them how much they
would get from superannuation as it currently is, most wouldn't know."
So how much do you get? If you're single and living alone, you'll get
$245.30 a week in the hand, plus you may be eligible for an accommodation
supplement. A couple will receive $377.38 between them.
When you're paying rent, or trying to keep up with the cost of owning your
own home, that amount doesn't go very far, Gibson says.
She tells the story of one woman in her seventies who lives on NZ Super.
Once her accommodation and food costs are paid, she can afford to go to town
only once a week. Recently she had to go to hospital for a day, so that was
her excursion for the week.
This woman, says Gibson, has a concession card to the local swimming pool.
She uses the showers at the pool so she doesn't need to use hot water at
For many young women, the idea of living in such straitened circumstances is
inconceivable. "I think that's where people's realities do need to be a
little bit adjusted. Jetsetting around the world isn't necessarily something
people are going to achieve in retirement. New Zealand Super is breadline
The barriers to New Zealand women's saving habits, such as student loan
repayments, child-rearing and lower pay, are well-known, Gibson says. But no
immediate solutions are appearing on the horizon.
Workplace superannuation schemes have steadily decreased to the point where
less than 3 per cent of employers provide them - covering approximately 14.6
per cent of workers.
Women are less likely to have access to workplace superannuation schemes due
to the part-time or temporary nature of their work, broken service and lower
This needs to change, Gibson says. "I guess it comes down to the industry
and making sure the industry provides products that are flexible enough to
accommodate different circumstances."
In the meantime, it is fundamentally important that women improve their own
Gibson is an almost annoyingly perfect example of what women should be
doing. When she first joined the workforce at 18, her employer had a
compulsory scheme. Her contributions were deducted from her wages and her
employer then contributed on top of that.
By the time she left that job, she had a tidy sum, which she immediately
Her most simple piece of advice for women is: the sooner you start saving
the better. Even if you can put aside just $10 a week, it will add up over
time. Compound interest can have a big effect if you start saving early.
Paying off student debt and saving for a house are important, Gibson
acknowledges. "But you can't eat your house in retirement ... People don't
really want to downgrade their house once they reach retirement. For baby
boomers they have the issue that they are all wanting to sell their houses
at the same time."
If dying prematurely is starting to seem an attractive prospect, think
again. In the 1950s, if you retired at 65, you probably had only a few years
left to live. Now, if you're female, you can expect to live at least another
19 years. It's a long time without earning.
Retirement Commissioner Diana Crossan, however, cuts a swathe through all
the gloom. Speaking from her home while in the grasp of a vicious autumnal
lurgy, she still manages to paint a brighter picture than Gibson.
From the outset - whether they have saved money or not - New Zealand women
are better off than their British counterparts, she says. New Zealand's
basic, flat-rate, taxable, individual state pension was a breakthrough for
women when it was introduced because it wasn't based on earnings.
Crossan points to the Ministry of Social Development's Living Standards
report which indicates elderly New Zealanders face fewer hardships than
their younger counterparts.
For some people coming off other benefits, NZ Super increases their income.
"There are lots of people who live on it. One third of the population live
off it entirely.
"If they own their house, we know that people do okay ... I think people
manage for their level of money."
Crossan acknowledges home ownership is dropping in New Zealand. But if
people who don't buy houses are saving, then it doesn't matter, she says. So
are they saving? She doesn't know.
"Not enough [young women] are preparing ... But I do think we need to be
careful about saying things like that to people who can't afford it."
Realistically, you can't expect an 18-year-old fresh out of school to
contemplate her retirement, Crossan says. And by the time she reaches her
mid-20s, she will very likely be snowed under with student debt. By her
mid-30s, she will probably be up to her ears in nappies and a mortgage.
Setting prohibitively high savings targets for young women is unproductive.
As often as not, they will simply shrug their shoulders and give up on the
idea of retirement savings altogether.
"What I prefer to do is talk to people at their level and talk to them about
what they can do."
In Crossan's mind, the victims of Prince Charming Syndrome are probably not
women in their 20s and 30s, but divorcees in their 50s.
For women who have happily played the role of housewife most of their adult
lives, a late divorce can be catastrophic both financially and socially.
These women may have left full-time work to raise children and often work
part-time in a low-paying job to help to pay for household expenses.
They may end up with the house, but their husband is likely to have the
superannuation package and - probably - significantly higher earning
potential in the last decade before retirement.
The important thing to remember, says Crossan, is that any preparation
helps. Even in this situation, squirreling away some money regularly can
make a difference in retirement.
"If they can do something when they are quite elderly, such as part-time
work after retirement, it helps."
Finally, she points out that retirement is not usually an expensive
lifestyle. Most people prepare their expectations around the amount of money
they will have.
"There are lots of things you do in retirement that don't cost you anything.
People start to get involved in things that don't cost: gardening and
Retirement is not, she repeats, all doom and gloom.
Prince Charming may have lost his allure, and Cinderella may not be able to
afford to wear silk and gold thread in her dotage. But as long as she
stashes away a few serviceable fabrics in her wardrobe, she should be okay.
It's not all Brothers Grimm just yet.