Fewer women than men have pensions, and those who do are saving less than their male counterparts, reveals independent research conducted on behalf of Handelsbanken Wealth & Asset Management.
Handelsbanken Wealth & Asset Management’s report, Can we solve the gender wealth gap? highlights the disparity in retirement savings between men and women, revealing that over a fifth (26%) of women have no formal pension savings at all, compared to just 16% of men.
Women’s pension pots were found to be substantially smaller too. The average pension across amounts for all respondents stood at £103,037. However, male respondents’ pension pots were found to be significantly higher, averaging at £142,234, while women’s came in at just over a third of this, at an average of £51,384.
It is therefore unsurprising that only 23% of women surveyed stated they are confident that they will be able to retire comfortably, with over a third (35%) believing they won’t be able to.
However, there are signs that things could be turning around for the next generation. While women over the age of 40 are generally less likely to have a pension than men of a similar age (63% vs 80%), men and women in their 30s were found to be equally likely to have a pension (77%). For adults under 30, women were found to be more likely to have a pension than men (76% vs 59%).
The research also revealed that most people tend to leave the management of their pension to their workplace pension provider (45%). Men were slightly more likely than women (43% versus 37%) to manage their own pensions, such as via a self-invested personal pension scheme (SIPP).
However, more than half (56%) of those who self-manage their pensions admitted that they seldom check their retirement savings – of which 64% were female.
Christine Ross, Head of Private Office (North) & 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.
“But despite signs of progress, there is still considerable work to be done. 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.”