How the gender gap hits women’s retirement savings as well as pay
A recent study has found women are generally less well prepared for retirement compared to men. The research, carried out by savings company Standard Life, reveals that whilst over half (55%) of men own a pension, this figure falls to just over a third (36%) in women. Even more alarmingly, more than seven in ten (71%) of women stated that they did not know how to start a pension. The average amount of money saved by women into their pensions each month is around £124, when the recommended amount is at least double that, depending on age and other factors. The average woman in the UK wants approximately £532 per week to live on when she retires, but even factoring in the state pension, women are typically only saving around half of what they should to be able to achieve this.
Almost nine in ten (89%) of the 1,000 women over 18 surveyed said they would like help with planning for their retirement. Over three quarters (76%) of the respondents who don’t currently have a pension admitted to being worried about this.
“Female pension ownership is frighteningly low and for those that do save, the amount saved is nowhere near enough for a comfortable retirement,” said Aileen Power, Standard Life’s women’s pensions spokesperson. She added that many women “want to continue having their sun holidays abroad, city breaks, dinners out and have some fun when they retire” but that “the average woman will be hard pressed to run a car in retirement” based on the average amount currently being saved.
Whilst the focus of the research was on women’s savings and pensions, Power also highlighted the wider issue of people failing to save enough for when they finish working. “While men will be relatively better off in retirement, on average, neither men nor women are saving enough to maintain their current lifestyles in retirement. You don’t want to get to 68 and find you can’t afford to enjoy a glass of wine or a decent night out.”
Power also emphasised that the first thing to do if you haven’t been saving for your retirement is informal research: “Our advice would be to start off by talking about pensions to your friends and family, particularly those friends who are financially savvy. Google pensions, read websites etc. Find out how much your peers are saving and consider getting some financial advice.”
* Research originally conducted in Euros.