New research by Legal & General has highlighted the gender gaps that still exist when it comes to pension provision.
Its survey of around 2,000 people aged 50 and over found that the average size of a man’s pension pot is £82,311, more than twice as high as the equivalent figure for a woman’s pension of £43,014.
25% of women have a pension pot of less than £5,000, whereas only 15% of men have this low level of savings.
Legal & General also cites data from the Office for National Statistics. This indicates that the majority of women (56%) feel that they have not saved enough for their retirement, whereas 43% of men feel this way. More than one-third (34%) of female respondents they don’t know the value of their pension pot, compared to 27% of men.
ONS data also shows that 56% of men have active private pension provision, compared to 51% of women. Women are more likely than men (28% to 25%) to participate in final salary schemes, but it is suggested that this might simply be down to the fact that more women than men work in the public sector.
Andrew Kail, CEO, Legal & General Retail Retirement, said:
“Our data demonstrates a significant difference between the pension wealth of men and women and raises further concerns about women’s finances at the point they reach retirement. We know there are a multitude of factors that influence these figures, from the gender pay gap to the increased likelihood of women working part-time or taking career breaks when compared to their male colleagues. We also know that the pandemic has likely increased this disparity due to the unpaid caring responsibilities that typically fall to women.
“We need to do more to address this financial inequality but also to address the root causes that influence it, specifically the significant burdens our society places on women outside of their careers.”
Separate research by Canada Life has suggested that there is a significant issue with getting pension savers of all ages, and both sexes, to engage with their pension planning. Its own research of 2,000 adults revealed that two-thirds (67%) had not logged in online to check the value of their pension during the last 12 months. 78% of over 55s have not done this during the past year. 15% of survey participants from all age groups said they were unaware of how to access this information online.
Only 44% of respondents indicated that they had read a pension statement they had received from the provider.
Canada Life suggests that there is an apparent contradiction between these data and separate findings which indicate that 69% of adults have paid closer attention to their finances during the past year. The company suggests that, rather than addressing their retirement provision, people might instead have reviewed their savings provision, switched bank account or paid off their credit card.
Andrew Tully, technical director at Canada Life, commented:
“The uncertainty caused by the pandemic has prompted people to pay more attention to their finances, but a major challenge still remains with pension engagement. Despite auto-enrolment changing the face of the pension ecosystem, not enough people are reviewing their pension and taking the relevant action to ensure they are in the best possible position when approaching or in retirement. This is amplified by the alarming fact that a significant number of people aren’t aware that they can log into their pension online and get at minimum, a basic sense of how much they have saved.
“It is clear that as an industry, we need to do more to make financial management as easy as possible. Many people find the process of reviewing a pension and taking action a daunting prospect; we encourage them to engage with an expert financial adviser to make this feel less of a burden.”