Gender pension gap remains at 40%

A new analysis of pension contributions finds the gender pension gap remains at around 40%, despite women being less likely to withdraw money from their pension over the last year.

A worried pensioner with her hands to her face


Men’s average quarterly contribution amounts have increased by 32% over the last year while women’s have increased by 15%, with the gender pension gap remaining at around 40%, according to analysis by pension provider PensionBee.

Based on 104,000 invested customers as at 30th September 2021, it found that men’s pension contributions increased on average from £801 in Q3 2020 to £1,058 in Q3 2021. Women’s average quarterly contribution amounts increased from £699 in Q3 2020 to £768 in Q3 2021.

As a consequence of these increased contribution amounts, the size of the average pension pot for both men and women grew by almost a fifth (19%) over the year, says PensionBee. The average male pension pot stood at £25,251 in Q3 2021, compared to £21,018 the year before, while the average female pension pot was £15,099 in Q3 2021 compared to £12,699 the year previously.

That amounts to a 40% gender pension gap, similar to the previous year. However, the gap for savers aged 55 and above narrowed slightly, falling from 53% to 49%. The gap is caused by a combination of lower salaries and long career gaps. PensionBee says that it means that, as a woman in her fifties will have less time to reduce the gap than a woman in a younger age bracket, she may have to work longer than anticipated, or become reliant on the State Pension to make up for the shortfall.

The figures also show that slightly more women than men – 22% versus 19% – made contributions to their pension in late 2021 and a higher proportion of women also opted to keep more of their money invested than men in Q3 2021. Only 4% of eligible female savers (aged 55 and over) made withdrawals to their pensions in this quarter, compared to 13% of eligible male savers during the same period.

Romi Savova, CEO of PensionBee, said: “It’s reassuring to see consumers prioritising their pensions by increasing their average contributions, and in turn bettering their retirement outcomes. This is particularly encouraging during the extended periods of economic uncertainty we’ve seen in recent years.

“It remains disappointing to see that women have significantly less in their pension pots than their male counterparts, and reaffirms the need to tackle wage inequality and offer gender inclusive parental leave. We must continue to encourage female savers to keep paying into their pension, as the more they can contribute today, the more they will be able to improve their quality of life in retirement.”

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