A new study carried out by My Pension Expert, based on business written since the turn of the year has revealed that women’s pension pots are on average 27% smaller than the male equivalent. The research also revealed that only 21% of all business written was conducted with women which leave them lagging behind their male counterparts who make up the remaining 79%.
The disparity in average fund size between men and women is the result of a number of factors. There’s the gap in earnings between the two genders, a greater proportion of women are employed part-time than men and on average women tend to take more career breaks. All that combined, on average results in a lower level of income when compared to men.
This means women typically have smaller pots or in some cases none at all if they’ve opted to be a housewife. The reduced pot size and lack of engagement explains why women are only responsible for 17% of all funds My Pension Expert has received.
Scott Mullen director at My Pension Expert said;
“It’s My Pension Expert’s hope that we will see this difference begin to close as a result of Work Based Pensions and Auto-enrolment. The gender pay gap for all employees, full-time and part-time, was also the lowest on record at 19.1% this year, down from 19.8% in 2013. So as the gap continues to narrow the disparity between pension pot sizes should also reduce with it.”
“It’s because of this disparity that it is even more essential that women seek out professional advice when arranging their retirement. As their pension pots are on average smaller, they need them to work even harder in order to attain their desired standard of living. An advisor can help them achieve this by selecting the most tax efficient product that best suits their individual needs.”
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