Pension warning as women’s savings lag behind men’s by over £90,000 – steps you can take | Personal Finance | Finance
A report looking at the gender wealth gap showed men’s average pension pots were worth more than £90,000 more than women’s. Just 23 percent of women surveyed said they are confident they will be able to retire comfortably while more than a third said they don’t think they will be able to.
Research by Handelsbanken Wealth & Asset Management found the average pension savings for all respondents was £103,037.
But male respondents’ pensions were on average worth £142,234, while women’s came in at £51,384, a difference of more than a third, worth over £90,000.
There are signs the situation could be changing with the next generation of pension savers coming through.
While women over the age of 40 are less likely to have a pension than men of the same age, men and women in their 30s are equally likely to have a pension, with 77 percent of respondents having a pension pot set up.
READ MORE: Savings warning as millions of Britons face losing £2,700 to inflation
For adults aged under 30, women were more likely to have a pension than men, with 76 percent of women having one while just 59 percent of men have one.
Christine Ross, client director at Handelsbanken Wealth & Asset Management, said: “Women on average continue to remain a long way behind men in pension savings, with the problem at its most acute among older generations who are closer to retirement.
“After decades of gender disparity, it’s encouraging to finally see clear evidence of change, with pension take up reaching parity among thirtysomethings, and women in their twenties ahead of their male counterparts.
“The recent steps taken at a Government level have the potential to further close the gender pensions gap, including the free childcare scheme expansion announced at the Spring Budget, which should allow more working mothers to return to the workplace and build their pension savings.”
What can I do to boost my pensions and retirement savings?
While Ms Ross said more needs to be done to improve the situation, she also pointed towards personal actions which could be taken to help.
She said: “Education around pensions needs to be improved, as does women’s confidence in financial products.
“We strongly encourage seeking advice on long-term financial planning where possible, to ensure that the plans you have in place are fit for purpose on an ongoing basis.
“Generally, it is important to review your pension regularly and to top up your workplace pensions where possible. If you’re unable to pay into a formal pension, there are plenty of other options to consider, including ISAs, which offer tax-free savings.”
Britons have an annual allowance for how much they can save into their private pensions, which is currently £40,000 a year, or the equivalent of a person’s earnings.
This is to go up to £60,000 a year, as announced in the Spring Budget, and the pensions lifetime allowance is also to be scrapped, in a bid to encourage people to save into their pensions.
People can currently save up to £20,000 a year in ISAs, which come with the benefit of not being taxed when depositing into the account, while any income from an ISA and interest earned is also not subject to tax.
A person may also want to check how much state pension they are on track to receive, which can be done using the state pension forecast tool on the Government website.
The full basic state pension is currently £141.85 a week while the full new state pension is £185.15 a week.
State pension payments are increasing 10.1 percent next month with the full basic state pension increasing to £156.20 a week while the full new state pension is going up to £203.85 a week.
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