CofL crisis exacerbates gender pensions gap

The cost-of-living crisis could be exacerbating the pensions gender gap, research from TPT Retirement Solutions has suggested, revealing that nearly half (46%) of women in their 50s expect to work for longer to afford retirement given rising prices.

The research found that two thirds of women (66%) aged 50 to 59 don’t know how much they have saved for retirement, compared to just over half (51%) of men in the same age group.

The survey also revealed that, despite not knowing how much they had saved for retirement, 60% of women in their 50s worry that they are not saving enough.

These concerns may be warranted, as the research found that among those who know how much they have saved, the average man in his 50s has saved £17,014 more than the average woman.

The findings also suggested that the cost-of-living is exacerbating issues, as rising energy bills were highlighted as significant burden to pension saving for 71% of women, whilst two thirds (66%) said they are struggling with food bills, and 25% are struggling with higher mortgage repayments.

As a result, nearly half (48%) of women in their 50s do not expect to be able to afford a moderate retirement based on Pensions and Lifetime Savings Association (PLSA) Retirement Standards.

Additionally, the cost-of-living crisis is expected to force many women to work for longer to afford retirement, as 46% of women in their 50s expect to work for longer, typically planning to work for an additional five years to cover the cost of retirement.

Commenting on the findings, TPT Retirement Solutions corporate services director Helen Taylor stated: “Coping with the rising cost of living has become a major challenge for many people, and our research shows women are struggling more than men.

“While inflation and energy bills may fall later this year, the cost-of-living crisis is likely to have a long-term impact on how prepared people are for retirement.

“We believe that early planning for retirement can play a crucial role in easing the worries of savers. As most women in their 50s plan to retire in their mid-60s, they still have time to build their pension savings.

“However, the earlier you start increasing pension contributions, the easier it will be to build a more substantial savings pot. By providing a secure and sustainable source of income in retirement, pensions can help individuals and families plan for the future, manage their finances, and maintain a decent standard of living.”

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