Pension savings made by women are slowly on the rise but continue to trail that of men, whose pension pots are around three times larger on average.
Men have saved an average of £73,600 while women have around £24,900 in their pension pots, according to Aegon’s latest Readiness Report.
Women are gradually moving to close the gender savings gap, as average pension savings have increased from £16,700 in 2015 and £20,400 last year.
Auto-enrolment helped to push a large amount of people to save into a pension, while the flexibility offered through the pension freedoms have encouraged more people to prioritise saving for retirement.
Engagement with savings remains a struggle, as more than a third of women surveyed had no idea how much money was saved into their pension while a quarter of men had checked their pension plan in the past six months.
Women in the survey sited not understanding the information issued by pension providers, lack of online services, and fear of seeing how little they had saved as some of the most common reasons for avoiding looking at thier pensions.
Kate Smith, head of pensions at Aegon, said that a “disrupted savings journey” due to maternity leave and working part time put women at a disadvantage for saving for the future, and called it “crucial” that women actively engage with their pension.
“Gaps in pension savings history can leave you worse off in retirement but for most women it’s unavoidable. As long as women are having babies, they will always be on the back foot when it comes to pension savings.”
Ms Smith added that the pension dashboard, due to be released in 2019, should help to spark interest in savings, but encouraged women to act before that time.
Claire Walsh, chartered financial planner at Aspect 8, said that the research is not surprising as it is reflective of the challenges women face in the workplace.
“Doesn’t surprise me at all; this is merely reflective of the wider gender divide women earn less, take time out to have children and whilst the gap has closed in recent decades this will be even more pronounced for women retiring now who entered the workplace in the 70s,” Mr Walsh said.
julia.faurschou@ft.com
