According to a recent report from pension provider Scottish Widows, the proportion of women who are now saving for their retirement has increased, along with their level of contributions.
Scottish Widows, who have tracked women’s pensions for the last fifteen years, have also concluded that although women are saving more into pensions, they’re still behind men in retirement savings.
The Gender Pension Gap
The “gender pension gap”, sees women retire on far smaller pensions. 57% of women are now saving enough for their retirement (Scottish Widows) however self-employed women and those in lower earning brackets remain under-prepared for retirement. It is believed that men are in fact benefitting from an additional £78,000 in their pension pot at retirement.
The main reason for this is the gender pay gap. On average, women are earning less than men, and most people pay a fixed percentage of their earnings into a workplace pension, meaning women are investing less into preparing for their retirement. Not only this, but the fact that women are more likely to work part-time or take time out to look after young children makes the gender pension gap worse.
Women typically live longer than men, and so if they are to enjoy the same standard of living in retirement, they need larger pension pots.
How to Boost Pension Savings
To boost pension savings, you may consider:
Maximising Your Savings
By joining a workplace pension, your contributions are boosted by tax relief and contributions from your employer.
If you are self-employed, you will not benefit on contributions from your employer, however you will receive tax relief on the money saved into a personal pension arrangement.
Getting A Pension Forecast
By finding out what you are likely to receive from your workplace or state pension, you can prepare accordingly. If your forecast doesn’t seem like you’re going to earn enough, you should aim to save more each month.
Don't Overlook Your Partner's Pension
Some pensions will pay out to a surviving spouse or partner, however if you are not married, you will need to sign a form to qualify.
If your partner has a substantial pension savings amount, you should make sure that you aren’t losing out on this particularly valuable benefit.
It is important, however, that you build pension savings in your own name and do not purely rely on the savings of a partner as you could lose out if your personal circumstances change.
KLO Financial Services
If you would like to find out more information about the gender pensions gap and how you can prepare for your future, speak to one of our experienced financial advisers today.
Call us on 01926 492406 or email email@example.com to review your options.