The extent of the gender pensions gap is revealed, as women lose out after childbirth compared to men.
The gender pensions gap could be as high as £186,300, as research reveals the extent to which men’s retirement pots outstrip those of women.
Women lose out more if they are married or in a relationship, with men aged 65-94 getting £8,460 more annually than their partners in retirement, according to research by lender More2life.
The figures were based on the Office for National Statistics’ projections that a 65-year-old female on average lives a further 22 years, while a man will live another 19.9 years.
The gap fell to £108,130 for single women, who expected to have an annual retirement income of just £14,833 from pensions, benefits, savings, investments compared to £19,748 for men.
More2life’s chief executive Dave Harris said much work needs to be done to close the gender gap in retirement income.
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Harris says: “At a time when there has been significant disruption to many people’s retirement savings, we need collaboration from industry and government to encourage people to engage with long-term financial planning.
“While our findings show that men and women are broadly consistent when it comes to state pension engagement, there is a clear disparity between the genders when it comes to utilising alternative retirement income sources.”
While around 76% of men and 73% women said they would rely on the state pension in retirement, men were more likely to have private sources of income.
Nearly half of men said their income was from a final salary or defined benefit pension, which pay out guaranteed amounts, compared to 37% of women.
Men are more likely to dip into their pension pots, with 28% drawing their pension to fund their retirement compared to just 19% of women.
Half of men had independent pension wealth, compared to just 39% of women. However, women aged 54 and over were more likely to hold cash savings and property wealth independently of their spouse or partner.
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Around 43% women have their own cash savings compared to 38% of men, while 26% of women are the sole owners of property wealth compared to 19% of men. Yet, almost 30% of women did not own property wealth at all, compared to 25% of men.
Diane Watson, founder of advice website She Can Prosper, warned that “the ongoing coronavirus crisis is set to exacerbate this problem for many more women over the years to come”.
The People’s Pension head of policy Tim Gosling said the main cause of the gender pensions gap is that many women have to work fewer hours and for less money after they have had children.
Gosling says: “As pensions are tied to pay, they end up with a smaller pension as a result.
“Expanding automatic enrolment coverage to ensure lower-paid women have access to a workplace pension and better access to childcare to enable women to return to full-time work, are key to tackling this issue.”
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