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Lack of interest in savings fuelling gender pensions gap

British women are twice as likely as men to be unaware of how much they have saved in their pensions, according to new research by insurance firm Aegon.

28 DEC 2019 | CHRIS SEEKINGS
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After polling 830 UK residents, Aegon found that 34% of females were unsure of their pension savings, compared with 16% of males.

It was also found that 40% of women have never estimated their income needs for retirement, compared with 32% of men.

Moreover, the proportion of women without pension arrangements has nearly doubled from 7% to 13% since 2017, and remains higher than the corresponding percentage for men.

Aegon said that a lack of pension awareness is key to driving the gender pensions gap, with females likely to have half the savings of their male counterparts once they reach 50.

“It is hugely disappointing that the attention given to addressing the gender pay gap does not seem to have inspired women to show more interest in their pensions,” said Aegon head of pensions, Kate Smith.

“Knowledge is key to helping solve the gender pension gap, so it’s really worrying to see that more than a third of women remain in the dark about what they have saved for retirement – if anything at all."

The researchers said the criteria for automatic enrolment into a workplace pension is another driving force behind the gender pensions gap.

UK employees must be earning a salary of £10,000 to meet the threshold for auto-enrolment, but many do not meet the criteria due to the fact they work part-time.

Separate research recently found that a record 71.4% of women are now in work, but that 41% of these were working part-time in the last quarter of 2018, compared with 13% of men.

Working part-time is thought to be responsible for a 47% cut in women’s pension wealth by their late 50s, compared with a 28% reduction caused by the gender pay gap.

This is compounded by the fact that women live longer than men on average, meaning that their pensions need to last for more years.

“A solution needs to be found for individuals with multiple jobs, each below £10,000, allowing them to benefit automatically from an employer contribution," Smith added.