Pension Savings Gender Gap At Record High
Women are saving £780 less than men a year for their retirement, as a new survey reveals the gender pension savings gap is at a record high.
This adds up to a difference of almost £30,000 over a working lifetime, according to new pensions data from Scottish Widows - giving rise to calls for a "fairer deal" for women who earn less than men and so have fewer opportunities to save.
The report found women are putting aside around £82 a month on average, compared with men who are investing £147.
The latest gap is significantly higher than the £700 annual difference between the amounts men and women were saving for their retirement a year ago.
The number of women saving nothing at all for their later years has also risen by 3% to more than a quarter (26%), compared to†just under a fifth (19%) of men.
The report suggests the gap has partly been driven by an increase in women's personal debt levels, with around a third (31%) of women saying they are having to prioritise debt repayments over retirement saving. Excluding mortgages, the typical amount owed has risen to just under £11,000.
Four in 10 women also said they have had to prioritise living expenses above saving for old age in the last year, amid the squeeze on household budgets.
Lynn Graves, head of business development, corporate pensions at Scottish Widows, said: "Important differences in lifestyle such as being more likely to work part-time or have a full-time caring role, mean women often find it more difficult to save for the long term and retirement.
"It has therefore never been more important for the pensions industry, Government and employers to raise awareness of this gender gap in retirement savings and help women prioritise their pensions."
Ros Altmann, director-general of Saga said the figures showed "women are still very much second class citizens when it comes to pensions" and called for an "urgent reform" of state pensions so that women get a fairer deal.
She said: "If they have not been able to save, or have saved too little, they risk†either having to stay working or being pretty poor.
"Our state pension partly depends on earnings, so those who earn least get the lowest state pension.
"This is clearly unfair to women, whose earnings are impacted by caring for others, which is a role that saves society huge sums.
"Therefore, we need urgent reform of the state pension system to ensure that even if women have lower private pensions than men, they don't then have lower state pensions as well."
The findings follow the launch of the Government's compulsory saving scheme this month to automatically enrol up to 10 million people into workplace pensions, amid concerns that people are not putting enough away for their futures.
The scheme began with larger companies and smaller firms will gradually be enrolled over the next six years.
Helen Dean, managing director for scheme development at Nest, a not-for-profit pension scheme set up under the new rules, said the move will help women who have not been earning enough to have a pension pot - or have not been offered a scheme by employers.