The gender pay gap is the subject of many discussions when it comes to gender equality in the UK. However, it’s often a subject that attracts controversy; to some, the gender pay gap is a myth, believed to be a reflection on women taking maternity leave, for example.
Whilst leave and part-time work does still negatively impact the pension contributions for women, the gender pay gap is undeniably real.
As part of 2021’s International Women’s Day, Scottish Widows have carried out research into the subject of gender pay gap.
The report suggests that without major change to the system, women in their 20s today will be retiring decades later with approximately £100,000 less in pension than men. In order to close this gap, women would have to increase pension contributions at the start of their career by five per cent. Shockingly, on these figures women would on average need to work an additional 37 years to acquire the same pension as men.
The gap is set to grow again owing to the pandemic with approximately 50 per cent of women under 25 on furlough, so it’s extra imperative that the pension gap is discussed on this International Women’s Day and beyond.
A staggering one in five women under 25 admit to never considering a pension according to the report.
There are no quick fixes here. But taking advantage of your workplace pension is vital as this means your employer contributes and tax relief is accruing.
Another key is education: pensions are often thought of as something to be considered later on in working life, but the earlier contributions are made, the better in the long-run. Publicly talking about concerns and issues regarding work and pension is vital if we’re to create a climate where we can look to close the pension gap. It's been done before: The Suffragettes fought for Women’s vote, the Ford Dagenham workers fought for equal pay.
Looking at the issue of the gender pay gap our view at LGBT Money's view is clear. It is an undeniable truth. One LGBT Money adviser told us: ‘Today is a huge wake-up call. We have an ongoing focus in advising clients on the necessity of planning for later life, specifically with a pension. Our experience is that our female clients are in many cases even unaware of the tax relief options open to them, which over time can amount to a significant sum.’
If you’d like any further information on pensions, or have any questions or concerns please get in touch with us at: email@example.com