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Pension gap can leave women £70K worse off at retirement

Modelling done by Nest, the workplace pension scheme, suggests the average woman working full-time in the UK could have a £41,000 gender pension gap at retirement. Based on the overall average UK wage, which includes part-time work, this gap widens to as much as £72,500.

Nest has produced a report examining how employers and savers can help fill in the pensions gender gap even in the face of the challenges of the Covid-19 crisis.

Women face extra challenges when saving for retirement, according to the report. Systemic issues – such as greater numbers of women working in lower-paid and part-time jobs – mean they have less to put into their pension. Women also live longer than men – on average by 3.7 years – so need their pension savings to last longer.

Covid-19 has had a significant impact on people's financial situation and their outlook. When surveyed at the height of lockdown in June, women saving with Nest were more likely than men to say they were only just about managing to make ends meet financially (34 per cent compared to 25 per cent) and nearly half (49 per cent) felt the pandemic will have a significant impact on their finances.

The report finds that women are also less likely to plan for retirement:

The report sets out the means by which women can reduce the pension gap.

For the report, click here.