The gender pension gap is a pressing issue, and it grows wider after women have children. While men’s pensions tend to stay on track, for women, the gap between their retirement savings and a typical man’s starts to widen significantly. Here’s why:
- Career Breaks for Childcare
It’s no secret that women tend to take on the lion’s share of childcare. In fact, 37% of mothers have left a job to cover childcare compared to just 18% of fathers. This leaves many women with gaps in their employment history, which often leads to lower lifetime earnings and fewer pension contributions. - Part-Time Work and Lower Earnings
Once children come into the picture, many mothers also switch to part-time work—increasingly the case for 47% of mothers compared to just 15% of fathers. As a result, these women often miss out on employer pension contributions, and their lower pay makes it harder to save enough for an equal retirement. - Missed Contributions and Smaller Savings
By reducing working hours or stepping out of the workforce to care for children, women may lose out on significant employer pension contributions, impacting their retirement savings. Lower earnings, fewer contributions, and fewer opportunities to benefit from tax relief all contribute to a pension gap that can range from hundreds to thousands of pounds by the time women retire.
What You Can Do to Protect Your Pension
Despite these challenges, there are steps women can take to safeguard their pensions:
- Review Your Pension Regularly: Make sure you’re on track and maximizing any employer contributions.
- Catch Up on Contributions: If you’ve had a career break, you may be able to make extra contributions to catch up on missed pension savings.
- Consider a Pension Transfer: If you’ve changed jobs, transferring pensions to one provider could reduce costs and increase growth.
- Get Expert Advice: Understanding how to navigate your unique pension situation, especially if you’ve had part-time work or career breaks, can make all the difference.
Take Control of Your Future
As International Women’s Day approaches, now is the perfect time to take a closer look at your pension and make sure it’s working as hard as you are. Don’t let career breaks, part-time work, or childcare responsibilities hold you back.
Want to make sure your pension stays on track, even with career breaks?
Book a free consultation today, and let’s start planning for a future where your pension is no longer a worry
