Client
Portal

The Gender Pension Gap issue

Back to News & Views

73% of women make only minimum pension contributions, compared to 58% of men

A significant difference in pension contributions between men and women has been revealed from a recent study[1], highlighting that women are more likely to pay the minimum required amount into their pensions under auto-enrolment.

According to a study, 73% of women contribute the minimum amount (5% of their salary, topped up with 3% from their employer), while only 58% of men do the same. Additionally, 25% of men regularly contribute more than the minimum, compared to 17% of women. Moreover, 10% of men occasionally make extra lump sum contributions, whereas only 5% of women follow suit.

Working days for extended periods

This disparity in contribution levels contributes to the UK's gender pension gap, which is estimated to have be nearly 40% in 2019/20[2]. Women not only contribute less as a percentage of their salary but are also 32%[3] more likely to reduce their working days for extended periods, affecting their earning potential.

Factors like falling below the auto-enrolment threshold, taking career breaks for motherhood or caring responsibilities, and long-term health conditions further impact women's financial futures.

Cultural shifts in recent decades

The difference in contribution levels will ultimately lead to financial inequality in retirement. Even though auto-enrolment has successfully brought over ten million people into the pension system, the current minimum contribution levels are insufficient for a comfortable retirement.

Life stages affecting women's earning power exacerbate the gender pension gap. Despite cultural shifts in recent decades, women still bear the brunt of caring responsibilities for children and vulnerable adults. The government's free childcare offerings may help improve the situation, but further expansion of the auto-enrolment scheme is necessary to make significant progress.

Will you enjoy the retirement you've been dreaming of?

To enjoy the retirement you've been dreaming of and be in control of your retirement plan, feel confident you can stop working when you want to. Enjoy the retirement you deserve. To find out more, please speak to us.

Source data:

[1] Boxclever conducted research among 6,000 UK adults. Fieldwork was conducted 6 Sept – 16 October 2022. Data was weighted post-fieldwork to ensure the data remained nationally representative on key demographics.

[2] 'The Gender Pension Gap', House of Commons Library, 4 April 2022.

[3] 'Caught in a gap: the role of employers in enabling women to build better pensions', Phoenix Insights, December 2022.

A PENSION IS A LONG-TERM INVESTMENT NOT NORMALLY ACCESSIBLE UNTIL AGE 55 (57 FROM APRIL 2028 UNLESS THE PLAN HAS A PROTECTED PENSION AGE). 

THE VALUE OF YOUR INVESTMENTS (AND ANY INCOME FROM THEM) CAN GO DOWN AS WELL AS UP, WHICH WOULD HAVE AN IMPACT ON THE LEVEL OF PENSION BENEFITS AVAILABLE. 

YOUR PENSION INCOME COULD ALSO BE AFFECTED BY THE INTEREST RATES AT THE TIME YOU TAKE YOUR BENEFITS.

Book your FREE, no obligation discussion today. Schedule Appointment

Sign Up to our mailing list - Receive regular news, tips and financial commentary from the Gemini Team.

Latest News

  • In the ever-evolving landscape of retirement planning, a significant shift is on the horizon that could potentially impact when you can access your pension funds. The normal minimum pension age (NMPA), or the age at which you can start withdrawing from your pension savings, is currently set at 55. [...]

  • In today’s fast-paced world, the concept of retirement often takes a back seat. For many, it remains a distant reality, mired by uncertainties and apprehensions. However, planning for retirement is an essential aspect of financial planning, which warrants attention from an early age. [...]

  • The challenge of managing bills and other financial obligations while simultaneously saving for a pension may seem daunting. However, it is certainly achievable with the right planning and timely action. The sooner you start, the more advantageous it could be if you contribute to a defined contribution pension. [...]

  • Significant life changes, such as getting married, having a baby and buying a property, are key times to consider protecting your family’s future. Life insurance assures that your loved ones won't face financial stress in your absence and this peace of mind is not confined to those earning an income. [...]

  • Recent studies indicate that approximately half (49%) of non-retired Britons plan to extend their working lives beyond the age at which they'll receive their State Pension[1], equivalent to approximately 19.2 million individuals[2]. [...]

  • The world of financial markets is a fascinating and ever-changing landscape. Much like the weather, the climate of these markets can shift rapidly. One moment, everything might be calm and sunny, with investors full of optimism and bullish about the future. Then, a storm may roll in the next moment, causing the same investors to scramble for cover and reassess their strategies. [...]

  • In the unfortunate event of one’s passing, there’s a possibility that HM Revenue & Customs (HMRC) may levy an Inheritance Tax (IHT) bill on the deceased’s estate. The estate’s total value determines the sum due after deducting any debts and applying all possible thresholds. Two thresholds that come into play are the nil rate band (NRB) and the residence nil rate band (RNRB). [...]

  • Navigating the world of pensions can be challenging, particularly when you’ve participated in various schemes or shifted jobs throughout your working life. Pension plans may close, merge or change names as time progresses, adding to the complexity. It might have been rebranded even if you recall your scheme’s original name. [...]

  • 2 weeks ago

    A recent study has identified an alarming discrepancy in financial confidence between genders. It shows that women are 33% more likely to confess to a lack of understanding about their pension operations[1]. This gap in comprehension could be a potential reason why some women seem less inclined to engage with pivotal financial products that promise better future outcomes. [...]

  • The dream of early retirement is alive and well among the younger generation. Still, to realise this dream, they must prepare to bolster their pension savings by an estimated 15%. A recent study has revealed that approximately one-fifth (17%) of youthful savers aged between 22 and 32 aspire to retire before reaching 60. Intriguingly, 70% anticipate retiring before the present State Pension age of 67[1]. [...]

  • Living a healthy lifestyle over a prolonged period significantly reduces the risk of developing various diseases as we age. This concept is rooted in the idea that our daily habits and behaviours profoundly impact our long-term health outcomes. [...]

  • Securing your family’s financial future is a multifaceted responsibility beyond merely accumulating savings and making long-term investments. It encompasses the creation of a comprehensive plan that ensures the wellbeing of your loved ones, even in the face of unexpected adversities. [...]

Gemini Wealth Management Ltd is Authorised and regulated by The Financial Conduct Authority Registered in England & Wales No. 5919877 Registered Office: Gemini House, 71 Park Road, Sutton Coldfield, West Midlands B73 6BT The Financial Conduct Authority does not regulate tax and trust advice, will writing and some forms of buy to let mortgages. The guidance and/or advice contained in this website is subject to regulatory regime and is therefore restricted to those based in the UK.

Website by Mellow Marsh Software
© Gemini Wealth Management Ltd
Important Documents | Cookie Policy