Women's retirement pots half the size of men's
Women have around half the pension savings of men, according to a new report from the TUC.
According to the study, which was conducted by the Pensions Policy Institute on behalf of the TUC, the average woman in a defined contribution scheme has just £7,500 saved for retirement compared to £14,500 for men.
For those in defined benefit (or final salary) schemes, the typical woman has £32,000 in contrast to men who have £62,900.
Women were also more likely to get a smaller state pension, receiving 25% less a year (£2,548) than men.
Ethnic minorities, carers and the self-employed were also found to have below- average pension provisions.
In its report, “The Under-pensioned 2016”, the TUC warns that there are still huge differences in workers’ pension savings despite the introduction of compulsory saving through auto-enrolment. This, it suggests, is because there are still many workers who do not earn enough to be eligible for auto-enrolment.
See our Guide to workplace pensions for more information on auto-enrolment.
Amongst the TUC’s proposals for improving the situation are reducing the £10,000 a year earning trigger for auto-enrolment, increasing contributions rates and removing the banding that limits the proportion of income upon which contributions are based.
‘Stark pension divide’
Frances O’Grady, general secretary of the TUC says: “Today’s report is a sobering reminder of Britain’s stark pension divide. Everyone should have the chance of a decent retirement income, not just men in full-time employment.
Women, carers and ethnic minority workers will continue to have a tough time in old age if swift action is not taken.”
“We urgently need a debate on how unions, government and employers can work together to can build on the success of auto-enrolment.”