Women on track for “pension saving parity” by 2028, FOI reveals

by | Dec 13, 2022

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  • Eligible female pension savers increase annual saving rates nearly three times as fast as men since 2009
  • Annual savings from women to exceed £71 billion by 2028, matching contributions to men’s pension pots

Women are set for “pension saving parity” with men by 2028, according to analysis of an FOI by Broadstone, a leading independent pension, employee benefits, and investments consultancy.

The data breaks down yearly pension savings into employee and employer contributions as well as tax relief, and women will be saving the same amount of money into their pensions as men in six years’ time.

Women accumulated a total of £52.0 billion in 2021, including £4.3 billion of tax relief on their pension savings, rising from £33.6 billion in 2009 – a 55% increase. Men increased their annual savings by 22% over the same period reaching £62.6 billion in 2021 – including £6.5 billion of tax relief.

 

On an annual basis, savings for men had a Compound Annual Growth Rate (CAGR) of 1.8% while savings CAGR was nearly three times as high (4.6%) for women.

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If this same growth rate was maintained over the coming years, it means that women’s annual pension contributions would match men’s in 2028, with both accumulating around £71 billion per annum.

Rachel Meadows, Head of Pensions and Savings at Broadstone, said: “Auto-enrolment has heralded a step change in pension saving in the UK, helping people build up pots for later-life who would have previously been excluded from the system.

 

“This has included younger savers, female savers and lower-income employees. It is great news that women are catching up their male counterparts when it comes to their annual contributions and could reach pension-saving parity within the next six years. “Building up sufficient pension savings to supplement the State Pension is the best way of securing a good standard of living in retirement. Even though women are some distance behind men in terms of total pension wealth, matching their annual contributions demonstrates how auto-enrolment is changing the landscape for a new cohort of pension savers

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