UK’s women facing GBP 1,000 pension gap

New research suggests only 40% of women – against 49% of men – are adequately preparing for their retirement.

In addition, those women who has started saving were, on average, parting with only GBP 182 each month – GBP 78 less than men.

This is creating a pension gender gap of almost GBP 1,000 each year.

The Scottish Widows UK Pensions Report, the ninth edition of an annual survey of over 5,000 UK adults by YouGov, stated 37% of women have no pension.

The report also found that, as a whole, the number of individuals making adequate preparations for their retirement fell to 45%, down from a 54% high witnessed in 2009.

With regards to women, it stipulated that increasing financial barriers and familial circumstances were stopping women saving at every stage in life.

Beginning with short-term financial gaps in finances in the younger years, women then face supporting children not only through their childhood and teenage years – but also well into adulthood.

The report therefore found that women have fewer opportunities to make savings, and that by the time they reach their 40s, almost a quarter of those aged between 40 and 49 “had prioritised financially supporting their children over retirement saving in the last five years.”

Almost more worryingly, whilst 24% of the surveyed women expect their partner’s pension to support their retirement, only 79% knew the legal repercussions to the plan if they were to separate.

A warning

This led to a warning from Scottish Widows’ Lynn Graves – Head of Business Development for Corporate Pensions – who cautioned women against overreliance on their spouse’s pension.

She noted “it is worrying to see that women are continuing to lag behind men in retirement savings.”

“Of particular concern is [those] planning to rely on their partner to help support them in retirement,” she continued, “but are unsure of what their pension provision would be were they to separate.”

In addition, recent reports have outlined how both parties are often unaware of the implications of certain pension plans and annuities if the husband were to outlive the spouse.

Typically, these plans would die with the husband, leaving the female widows in a precarious situation exasperated by the fact women often outline men.

“We should encourage these individuals to take full responsibility for their financial independence,” furthered Graves.

“Knowing what you are entitled to allows you to make informed choices and gives you a back-up plan.”

The company have stated that people who are saving at least 12% of their income should face a comfortable retirement.

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