Women 5k pa Worse Off Gender Gap in Retirement

Published / Last Updated on 31/05/2018

Prudential has released its latest research, broadly entitled “Class of 2018” study suggesting the huge gender pay gap is still following women into retirement.

Prudential’s findings:

  • Women retiring in 2018 are nearly £5,000 pa worse off than men (29% lower)
  • One in six women will retire this year with an income below the Joseph Rowntree Foundation’s minimum income standard
  • Women’s retirement income is at an all-time high as the gender gap shrinks

Women retiring in 2018 will have average expected retirement incomes £4,900 lower than men as the gender gap remains a major issue, reveals new research from Prudential.  

Kirsty Anderson, a retirement income expert at Prudential, said: “The retirement income gender gap is still too wide, at nearly £5,000, with women struggling to match the incomes generated by men.

“However, it is really encouraging to see that the retirement income gender pay gap is shrinking over consecutive years and women are starting to close the gap on men. It is also extremely positive news that expected retirement incomes this year are the highest on record.

“As working patterns continue to change and become more flexible and shared parental leave is more widely encouraged by the government agenda and employers, the future looks positive for narrowing the retirement gender gap.

“It can be difficult to justify any extra expense when taking a career break, but it is extremely important for anyone taking time out of work to maintain their pension contributions. Saving as much as possible as early as possible is the best way to secure a good quality of life in retirement.”

Prudential has tracked the finances, future plans and aspirations of people planning to retire in the year ahead in its Class of research for the last 11 years.  It highlights the persistence of the gender gap with men expecting to retire on an average annual income of £21,800 compared with women’s of £16,900.  

The Joseph Rowntree Foundation’s (JRF) Minimum Income Standard states the income for a single pensioner should be at least £9,998. However, findings show that one in six (16 per cent) women will be retiring with an income below this standard, compared to just one in 10 (10 per cent) of men.

Conclusion

Still more needs to be done on equal pay and equal benefits but, it is a fact of life, that generally it is a woman that takes a career break for children, so we may never quite see the gap disappear, perhaps joint taxation and a joint sharing of all pay and benefits for couples would help?  That said, it will never tackle single parents who will always be playing catch up.

Explore our Site

About
Advice
Money MOT
T and C