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International Women’s Day: A reminder of the gender pensions gap

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08/03/2022
Today marks International Women’s Day, a celebration of all their achievements. But it also acts to highlight gender inequality, particularly when it comes to pension savings.

The gender pensions gap is also a running theme, with research revealing that women save less for their retirement and are more reliant on the state pension compared to men.

In fact, Barnett Waddingham revealed that more than a quarter of women (27%) rely solely on their state pension to fund their retirement.

This is nearly double the number of men (15%).

And it revealed the gender pensions gap widens over time as the playing field is more equal at a younger age.

Between the ages of 18 and 34, 50% of women have a workplace pension, just behind the figure for men which stands at 49%.

However, when it comes to private pensions, men take the lead, with 20% of those aged 18-34 having one, compared to 10% of women in the same age bracket.

Worryingly, one in 10 women didn’t know if they had a pension, and a further 4% believe they have a pension but aren’t sure which type.

But on the plus side, Barnett Waddingham said the number of women solely dependent on the state pension has fallen over the last year, when it stood at 30% in 2021, based on a survey of 2,000 people.

‘The world has changed but financial services has not’

Amanda Latham, policy & strategy lead at Barnett Waddingham, said: “There is now an insurmountable amount of research shining light on the stark gender pensions gap, which is of course driven by the gender pay gap. The UK pensions system is designed for a society which no longer exists; one where men went out to work and women stayed at home within a strictly nuclear family. Now, the world has changed but the financial services infrastructure has not.

“For International Women’s Day, it’s time to take the burden of solving this financial failure away from women. We need to consider fiscal, behavioural, and societal issues collectively, and work to create a more robust and inclusive pensions framework that offers fairer solutions for all. Policymakers must urgently prioritise reform, including reviewing the auto-enrolment rules to increase the minimum level contributions and remove the minimum earning requirement, change the state pension to better reflect career breaks, and move to a flat rate of pension tax relief.”

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