Women would need to work for an extra 19 years to retire with the same amount of money in their pensions as men.
A report by NOW:Pensions, in partnership with the Pensions Policy Institute, found by the time women reach 67 they will have average pension savings of £69,000.
This is £136,000 less in pension savings than the average man.
This means that by the age of three, girls are already falling behind boys in their provision for later life.
Joanne Segars, chairperson of the trustee board at NOW:Pensions, said: “It’s hard to believe that by the time a young girl starts school at four, she will already be falling behind a boy of the same age when it comes to providing for her retirement.
“Yet this is the reality many girls face as they leave education and enter the world of work.”
The gender pensions gap is down to the gender pay gap as in 2023, women’s average pay was three quarters of men’s highlighting a gender pay gap of 25 per cent.
Women are more likely to have different working patterns than men over their working lives which has a huge impact on earnings.
One of the big reasons women take time out of work is to provide childcare for their children.
Women are 60 per cent more likely to carry out unpaid work and take on primary carer roles than men, averaging at 26 hours a week.
Speaking at the launch event of the report, David Bird, director of defined contribution platform at NOW:Pensions, said: “Thinking about childcare is a very important aspect, we see in other countries where this is less of an issue because access to childcare is much better.
“Another aspect is we also need to think about sharing the responsibility for these things much better between the genders, it is absolutely assumed that women will take time off work to look after their children. The stereotyping is absolutely all over this. And we do need to change that.”
Bird said he is starting to see the environment change and parental leave is being thought of as shared between the genders but more of that is needed to start to change the way society thinks about who’s responsible for care.
Another key reason that is affecting midlife women is the need to care for their elderly parents.
Stephanie Hilborne, chief executive of Women in Sport, said: “Carers UK stats show that by the age of 59, 50 percent of women have responsibility for older age relatives for men that age is 75. Women are carrying the responsibility for the ageing population.”
In terms of what employers can do, Hilborne said her charity has been advocating for employers to create a policy that recognises the whole experience of women in midlife who make up their workforce.
One of the ways that the gender pension gap can start to be narrowed is by reducing the auto enrollment age to 18 and to remove the lower earnings limit of £10,000.
Segars said: “The £10,000 limit excludes three million women from saving into their pension in the first place, this is one of the big things that needs to change.”
She called for the government to create a roadmap of how these changes are going to be done and what they might look like.
“If they [the government] don’t then somebody else is going to be sat here in 20 or 30 years still talking about this issue and collectively we just cannot allow that to happen," she added.
alina.khan@ft.com
