Millennial women are less financially confident than their male peers, despite improvement in the gender pay gap, according to research by the Pensions and Lifetime Savings Association (PLSA).
The study based on interviews with 1,001 millennials in February found that despite having the smallest gender pay gap of any age group at 5%, millennial women- those aged between 18 and 35 - are more financially anxious than millennial men.
Several key financial indicators are seen to be the reason why millennial women appear less financially confident in comparison to their male counterparts. Research highlighted that women felt less optimistic about career advancement, as 55% of women felt positive about promotions in comparison to 61% of men.
PLSA director of external affairs Graham Vidler said: "Early in a woman's career, when the gender pay gap is at its lowest is arguably the ideal time to get into the savings habit and start thinking about retirement income."
Vidler said an occupational pension could be an option for these women, as they would not only "benefit from employer contributions and tax relief, but also gain peace of mind for the fact that they are taking proactive steps to building a better standard of living in retirement."
The study also demonstrated that women were feeling increasingly pressurised in the past six months to save for the future, as 51% of women were concerned about this compared to 36% of men. Purchasing a house was also seen as a seemingly unrealistic goal, with only 26% of women optimistic about buying a home, while 36% of men thought this was an achievable target.
It is significant that all millennials were conscious about being financially worse off than their parents. Both genders, 57 % of men and 58% of women, felt less able to save than their parents, and that the basic cost of living was much higher, with 85% of men and 88% of women echoing this point.
While millennials may be in agreement on some issues, more women (37%) believed they have had worse life opportunities than their parents' generation, in comparison to 30% of men. This suggests that women still perceive significant barriers to their ambitions, despite improvement in the gender pay gap.
The PLSA pointed towards pan-European research on financial literacy released by Allianz in January, which indicated women are less likely to take calculated risks due to lack of confidence in their financial knowledge. The trade body said this is likely unfounded, as additional research showed the actual gender financial knowledge gap is smallest among millennials.
Vidler added: "It is vital that the lack of financial confidence among millennials does not discourage them from taking advantage of workplace pensions and falling behind when saving for retirement."
It is thereby important that millennials receive appropriate guidance and support from their employers regarding pensions and their retirement choices to ensure they make the best choices possible.
The interviews with 1,001 people were carried out by ComRes between 9 and 20 February. Data was then weighted by region to be representative of all British adults aged 18-35, by gender, age and socio-economic grade.
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