Data uncovered in the seventh Scottish Widows Women and Pensions Report has shown that an increasing number of women are saving adequately for retirement. This year 50% of women were shown to be saving an adequate amount, compared to 43% in 2010. On average women save 12.9% of their salary compared to 12.9% of men, although of course men on average earn more than women resulting in men ending up with a larger pension fund. The extra pension saving by men equates to £700 per year extra compared with women.
Ian Naismith said from Scottish Widows says that… “…it is encouraging to see a positive step change in the number of women saving adequately for retirement, especially given the challenging economic climate, but the gender gap still exists.” Other issues highlighted include the fact that women are more likely to work part-time, have career breaks, earn less and have to deal with the increasing cost of childcare. All of these contribute to a lower level of retirement saving.
Below we have highlighted some advice for women and pension saving.
- Try to maintain pension contributions even when you are not working (if possible).
- Partners can contribute to your pension if you are not working. (up to £3,600 p/a).
- Claim National Insurance credits if you are caring for young children.
- Call the DWP to see when you can claim your pension & the amount. Recent changes in legislation mean that the state pension ages are rising for men and women.
- If possible get a pension in your name, don’t rely on your husband/partner.
- Shop around for for an annuity and consider a joint-life annuity, whereby if your partner dies prematurely the income from their annuity can be passed to you. Over half of married men don’t do this and buy a single-life annuity.
- Join your employers pension scheme, they will make contributions towards your pension.