Thousands of women warned they risk losing £225,000 in pension savings

A new study by PensionBee highlights the difference in retirement savings between couples. Men typically have almost £440,000 in pension savings by age 64, compared to £300,000 saved by women of the same age

Women have to lose thousands in retirement
Women have to lose thousands in retirement

Thousands of women have been warned they would lose £225,000 in pension savings if they retire at the same time as their male partner or spouse.

That’s according to a new study by PensionBee, which highlights the retirement age gap and saving gap between couples.

Data shows that by the age of 64, men have typically accumulated nearly £440,000 in pension savings.

This is compared to the £300,000 accumulated by women of the same age. If they wished to retire at the same time as their husbands, they would have a pension savings difference of £140,000.

For a couple with an age difference of two years – so if the man is 64 and the woman is 62 when she retires – the pension savings difference would grow to £177,000.

Here’s how to prepare for retirement

This is based on the woman having a pension pot worth around £260,000, according to PensionBee analysts.

Meanwhile, a couple with a five-year age gap – a man aged 64 and a woman aged 59 – could potentially have a £225,000 pension gap worse off.

PensionBee estimates that a woman of that age would have roughly a pension pot worth just over £214,000 when she retires.

Worried about how to afford your retirement? Let us know:

The pension experts told This is Money that their calculations are based on ONS data and a proprietary modeling system.

They considered median gross weekly earnings and median hourly wage to calculate median annual paid hours and annual wage by gender.

It states: “We assumed annual pension contributions of 8%, growth of 7% and fees of 0.5% for consumers who save between the ages of 25 and 64 and do not withdraw between these age groups.”

Romi Savova, Managing Director of PensionBee, added: “While coordinating retirement is a common goal for many, the UK’s persistent gender pension gap poses a significant obstacle to achieving this goal, one that will only be exacerbated for couples of different ages .

“This huge disparity in pension pot sizes for savers within a five-year age bracket underscores the urgent need for policy intervention and bold action by employers to enable women to enjoy the same wealth as men in retirement.”

Of course, the numbers don’t apply to every couple, as there are always different variables when it comes to pension pots.

For example, your income, how much you contribute towards your retirement, and when you start saving will have a big impact on how much you have saved for retirement.

According to PensionBee, there are many reasons why there could be big differences in retirement savings between men and women.

For example, a parent may choose to take time off from work to raise and care for children or to care for an elderly loved one.

However, there are some ways to save for your retirement even when you’re not working.

This may include retaining contributions to a previous workplace system and maximizing your retirement savings prior to a career break.

It’s also worth reviewing old pensions that you no longer pay into to see if you should combine your pensions or keep them separate.

Always seek professional advice if you are unsure of what to do.

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Fry Electronics Team

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