The higher cost of goods and services, as well as stubborn inflation and high interest rates has meant that households are constantly seeing their costs go up while their wages don’t keep pace.
“The poorest 20% of households reduced their spending by 4% in 2023; those that have the smallest amount leftover each month. As a pension’s provider, we understand saving can feel less achievable when the daily financial pressures creep up – particularly during periods of high inflation.
“Any reduction in pension saving will deeply impact the level of comfort that can be achieved in retirement, an issue that is even greater for women. Our gender pensions gap report found that on average women need to save from the age of 3 to retire with a pension pot the same size as men. Career breaks, caring responsibilities and the need for more flexible working patterns to fit around childcare are just some of the realities that can impact women’s pension savings. NOW: Pensions has actively been calling on Government to introduce a family carer's top-up for women which would see the Government pay the equivalent of an employer's contribution into carers' pensions at the same level as the National Living Wage.
“As households navigate day-to-day financial challenges, it is essential that Government actively works with the pensions industry to ensure that saving for the future is not overlooked. We welcome the Government’s announcement of a pensions review and continue to call for government, industry, employer and member representatives to work together to develop a roadmap on the future of Auto Enrolment - including what adequate saving looks like, and the role of AE within that. This will enable AE and the pensions system to meet the needs of all future retirees, and also help people to understand the impacts of their expenditure and saving trade-offs.”
ONS Family Expenditure Data
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