It has been well documented for some time that women continue to trail behind men in terms of both State and occupational pension provision across all working age bands. On average a pension pot for a female tends to be typically around 50% less than that of their male counterpoints.
The pension gender gap is often directly linked to the gender pay gap. Women typically have career breaks, for instance if they go on maternity leave, they may go on to stay at home to bring up their children and increasingly have the responsibility later in their careers of looking after sick or elderly relatives.
Pay is not the only contributing factor to the pension gender gap, however.
When you divorce, pension pots can be one of your biggest assets, after the family home, so it’s important to divide them up fairly. It has been reported recently however, that just 12% of age 50-plus divorcees have taken pensions into account when dividing their assets. This can create some big problems for women as they can see their annual income fall by almost twice as much as men after a divorce, making it harder for them to save into their own pensions.
It is also now being recognised that the menopause is a factor that has been widely unregistered when discussing women’s retirement savings. Menopausal symptoms have forced thousands of women to reduce their hours or worse still, leave work altogether. As a result, these women are missing out on important pension savings at a key stage in their life.
There is a complex relationship between ethnicity, gender and financial situations too. It is clear that some ethnic minorities, notably Black women, face particular challenges with retirement preparations.
Single mothers are also considered a financially vulnerable group of women when it comes to retirement savings.
There is no one easy solution to the issues facing women in their retirement planning and right now the adverse economic conditions are making it even harder for women to close the gap.
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