Personal Pension  

The incredible shrinking woman’s pension

This article is part of
Guide to helping mid-lifers plan for retirement

The incredible shrinking woman’s pension

The 1970s slogan of women needing men like fish needing bicycles is recognisable to feminists all over the country. 

What is less well-known is that this generation of women are in worse danger than their male peers of ending up in pensioner poverty.

In the UK, middle-aged women, as a group, are not well prepared for their retirement. 

In its latest Women and Retirement Report, published in October 2018, Scottish Widows found just 54 per cent of women were saving adequately for retirement. Some 18 per cent were saving nothing at all. 

The report also showed that at every age, men’s savings outpace women.

As savers reach their 40s, women have an average of £23,000 in savings and investments but men have more than £50,000.

Lynda Whitney, partner at Aon, says the main factors behind this were gaps in service or reduced hours due to caring responsibilities for children or elderly relatives.

Additional factors include the gender pay gap and women’s longer life expectancy, meaning they also need to save more to have the same comfortable retirement as a man. 


Dr Matthew Connell, director of policy and public affairs at the Chartered Insurance Institute (CII), explains: “Our Insuring Women’s Futures campaign identified that the average pension wealth of women aged 65 is £35,800, just one-fifth of men the same age and a mere fraction of their financial needs in retirement irrespective of their end of life care costs.”

The CII also found just 8 per cent of women viewed contributing to a pension as their highest priority when starting work, and over half of women in their late 20s said they did not understand enough to make decisions about retirement savings. 

Left unchecked – which is largely what has happened – these women hit middle-age without changing their view. 

Samantha Seaton, chief executive of MoneyHub, notes by the time people reach middle age, they should have considered how they want to live in retirement and then figured out how to get there. 

But while both genders often leave it too late, for women the situation is more complex. 

“Even at middle age, women are still more likely to take time off work for childcare, which means less time earning and contributing into their pension,” says Ms Seaton.

“This can also have knock-on impacts on salary going forward.”

Financial future

This smouldering issue is often made worse by a reluctance to tackle it head on.

Rebecca Robertson, director and independent financial adviser at Evolution Financial Planning, hosts sessions aimed exclusively at middle-aged women, who are afraid of confronting the enormity of their finances in retirement. 

By using anonymised, real-life case studies, she shows the situations – both good and bad – women can end up in and encourages them to act.