Women investing £776 a year less than men, due to pressure over rising bills and desire to settle debts, report suggests
The gap between women’s and men’s savings into pensions has grown in the past year, with women now investing £776 a year less than their male counterparts, according to research by Scottish Widows.
The insurer’s annual Women and Pensions report showed that after two years of narrowing, the gender savings gap has increased to the highest level in the eight years it has been asking people about their savings.
The average monthly saving among women has fallen from £130 to £95 since 2011, while the average for men has risen from £174 to £185. A 30-year-old woman who continues saving at the same rate will retire on a pension pot almost £30,000 smaller than a male the same age.
The report, which was based on interviews with 5,200 adults, found the number of women saving nothing at all increased year on year from 23% in 2011 to 26% today. The proportion of men not saving for retirement stands at 19%.
A raft of reports have suggested that women have been hit hardest by the economic downturn, with high unemployment rates and the loss of some benefits. The report suggests growing financial pressures from rising bills, combined with a desire to pay down debt, is causing women to neglect saving into a pension.
Scottish Widows found women were undertaking long-term savings outside pensions, although the amount put aside has fallen. Women who are saving put aside £203.21 a month on average, down from £227 in previous years, and 29% are saving on a regular basis.
Lynn Graves, of Scottish Widows, said: “The recession has had a major impact on people’s attitudes to managing their finances, as the messages to ‘live within your means’ has been hammered home. While women are right to focus on making sure their debts are manageable, other sacrifices may need to be made to ensure retirement planning is in place.
“There is clearly a demand for greater financial support and financial education to help people get the balance right between managing debt payments and taking a realistic approach to long term savings.”
Dr Ros Altmann, the director-general of Saga, said the figures showed women were “still very much second-class citizens” when it came to pensions.
“They earn less than men and have fewer opportunities to save, and with more women being single in later life than ever before, they will not be able to rely on a partner’s pension.
“If they have not been able to save, or have saved too little, they risk either having to stay working or being pretty poor. It is encouraging that women are trying to pay back their debts, but once that is done they will need to save significant sums if they are to build up a decent pension.”
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