£100,000 pensions gap for women in part-time work
Women's savings are being cut due to part-time work leaving them £105,000 worse off than men in retirement, research conducted by the Pensions Policy Institute (PPI) and Now Pensions revealed.
Now Pensions' Facing an unequal future - closing the gender pensions gap report - which includes the PPI's research - revealed women who balance part-time work with caring responsibilities are facing a 47% reduction in their pension pots compared to men by their late 50s.
The research shows that, by their 60s, women typically have £51,100 in their retirement pots while men have three times this with savings typically sitting at £156,500.
The report reveals for women to accrue the same amount as men, they would need to save 5%-7% more by retirement age.
This "part-time pensions penalty" has a bigger impact than the gender pay gap, which cuts women's pension savings by 28% as a result of them typically earning 18% less compared to men in their lifetime.
Now Pensions interim trustee chairwoman Joanne Segars said: "[Women] are much more likely to work part-time or take time out of the workforce to care for children or elderly relatives.
"This time out of the workforce has a huge impact and the part-time pensions penalty can't afford to be ignored."
Auto-enrolment limitations can also leave women with smaller saving pots than men in retirement as a part-time salary may leave them ineligible if they do not meet the £10,000 threshold - meaning they will miss out on additional saving and receiving valuable employer contributions.
The Fawcett Society - a charity campaigning for gender equality - chief executive Sam Smethers said the "shocking pensions gap that women experience" could be reduced if we "lowered the threshold so that more low paid women in part-time work could benefit".
The People's Pension director of policy Gregg McClymont stated the gender pensions gap is "stark", adding: "If we're going to tackle pensions inequality, not only are changes to auto-enrolment required but better provision of affordable childcare is a must to enable those mums that want to keep working or work more hours, to be able to."
More on Industry
Redington gains private equity house as long-term investor
Redington is in the process of securing private equity backing from Phoenix Equity Partners for an undisclosed amount.
PPF introduces updated insolvency risk services
The Pension Protection Fund (PPF), in partnership with Dun & Bradstreet (D&B), has published its plans for updated insolvency risk services and is consulting on its approach to insolvency risk measurement from 2021.
TPR publishes research on leverage and liquidity
The Pensions Regulator (TPR) has published research on leverage and liquidity to better gauge the potential risks for defined benefit (DB) pensions and inform the Bank of England’s Financial Stability Report.
LGPS Scotland review reveals financial position of member funds
The first formal review of the Local Government Pension Scheme (Scotland) (LGPS) has revealed all 15 of its funds are in a strong financial position.
Have your say: Should DB trustees help their members source financial advice?
In this week’s Pensions Buzz, we want to know if you think defined benefit trustees should help their members source financial advice.
Most read
