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Pension savings gap widens between men and women

13 October 2009 / by Andy Davies

Women appear to be falling further behind men when it comes to saving for their retirement, according to a report by Scottish Widows.

Despite overall savings for pensions rising in the last 12 months, the gender gap for pension savings has increased by three per cent in the past year to 12 per cent as 47 per cent of women said they were saving adequately for their retirement, compared to 59 per cent of men.

The report states that more than a quarter of women that could and should be saving are not putting any money aside for their retirement, while this figure falls to 15 per cent for men.

Concerns about the economy and recession have led to an increased amount of women putting off saving for their later years as 12 per cent of women, up from six per cent last year, said that they believe job insecurity will prevent them from making any savings plans in the forthcoming year.

Concerned by these findings, Ian Naismith, head of pensions' market development at Scottish Widows, said: "During the economic downturn overall pensions savings have increased, but this is mainly among men and the gender gap has actually widened compared to last year. In a climate when people need to be saving more than ever for their futures, it is worrying that women over 50 are actually saving less than previous years."

However, it is perhaps unsurprising that women are behind men with regards to saving for their retirement, as 24 per cent of women with dependent children admitted they could not afford to continue paying into a pension plan, whilst debt is also proving a factor, with women on average having in excess of £1,000 more non-mortgage debt compared to men.

Commenting, Mr Naismith said: "There is a long way to go before women catch up with men when it comes to pensions' savings but the issues of taking time out to have children and interrupted working patterns are never going to change."

Encouragingly, 65 per cent of women aged between 18 and 29 have accepted that the state pension will not provide them with the funds needed to maintain a reasonable standard of living.

Mr Naismith claims more needs to be done to help women, especially those with families, to save for their future:

"It is also up to the Government and the industry to accept that women need a bit more flexibility when it comes to pensions' savings," he said. "While progress has been made in this area there is still more that needs to be done such as placing more value on workplace pensions and enabling women to access funds before retirement which would better suit their lifestyles."

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