Women struggle to save enough to pay a decent income in retirement – but why is there a gender pension gap?
Salary is not the only factor.
Many women earn less than men even though they do the same job, but new research has found even when women earn the same as their male colleagues, they manage to save less money for retirement.
Only 52% of women over 30 years old earning at least £10,000 are putting enough money aside for retirement, compared to 60% of men.
Also, one in four are not saving anything – when the figure for men is nearer one in seven.
The study Closing the Pension Gap: Understanding Women’s Attitudes to Pension Saving by the Fawcett Society and Scottish Widows busts some myths suggesting women are better at financial planning than men.
The report looks at eight reasons why women may have less money to save than men – and offers some ways to make up the shortfall.
As much as not receiving equal pay is not right, it happens and needs considering in financial plans
Mums or more likely to give up work to look after children, which means less income and savings
A follow on from family breaks. Women tend to work fewer hours rather than go straight back into full time working – and once again less income means less available to save
The study reveals child care costs often come from a women’s salary rather than her partner’s, and these can add up to a significant amount. The partner is often unaware of these costs because he is not around to see them
Time just runs away
Looking after children is a tough job and demands a lot of attention. Lots of women told researchers that they ignored information about pension planning because they were too busy
Many women said they had no pension or savings because their husband dealt with the finances. The report slates this as just an excuse.
Pensions are designed to fit men’s working patterns rather than accounting for career breaks and part time working
“Women need to take control of their finances and stop relying on their partners,” said a spokesman for Scottish Widows.
“For instance, men should pay more towards keeping a family. Rather than split the bills so both partners pay the same, the housekeeping should be percentage based share of take home pay.”