Ladies, let’s talk pensions!
A 5 minute read
Ladies, let’s talk pensions!
It’s the start of the year; a new decade even! The time where we set our goals and ambitions for the year ahead. But ladies, have you thought about your pensions?
NOW: Pensions research in July 2019 revealed that women are retiring with pension pots 1/3 the size of men’s. That is over £100,000 less!
Thanks to the gender pay gap and the difference in working patterns for women (typically to care for children or elderly relatives) women are left with significantly smaller pension pots.
It's a perfect storm for us ladies; we have less money to put in, followed by intermittent working patterns and we need it to pay out longer as we typically live longer than men.
Tips to boost your pension saving
Pension saving can be difficult, especially for women who have had to reduce their hours to manage childcare responsibilities, but there are a few small changes that you can make to boost (or start) your pension saving.
1. Don’t delay
As soon as you start full time employment, enrol in your company pension scheme. Even if you’re not aged 22 or earn the £10,000 minimum, you can still opt in!
If you start contributing as soon as you begin work, you won’t miss the money.
2. Don’t opt-out
Yes, as a single parent myself, I appreciate there are a lot of pulls on your finances each month (rent, bills, food etc.) but if you contribute to your workplace pension scheme you’ll get the additional benefit of your employer's contributions and the government may contribute via tax relief (it’s essentially free money!)
3. Do pay in the maximum that you can afford
Find out what the % your employer will match and aim to pay in at least this amount. For example, if your employer will match contributions at 8% then aim to pay in at least 8%. This means you’ll be contributing 16% a month and you may get the government tax relief on top.
Any more that you can afford to pay on top of this is a bonus.
4. Don’t forget about your pensions
Monitor your pots on a regular basis. You will receive an annual benefits statement from each provider which will show you how much you have contributed to your pension, give you an indication on how much your pension pot will be worth at retirement age. It is worth reviewing these and seeing if you are able to consolidate smaller pots together.
5. Do set retirement goals
The PLSA have recently launched their Retirement Living Standards which looks at the type of retirement you can expect, split into three group: moderate, comfortable, luxury. These are a great place to start your pensions goals!
6. Do put extra in
Any unexpected bonuses or money are well spent on topping up your pensions. It was money that you didn’t have so shouldn’t miss as much as income you rely on monthly.
For more information - read our latest press release here.
Helping to close the gender pensions gap
We are working unilaterally to help improve gender equality in the UK pensions system.
To learn more about our projects, don’t hesitate to get in touch!
Samantha Gould, NOW:Pensions