This week is Pension Awareness Week, a campaign that encourages everyone to get to know their pensions better and has helped improve the financial lives of millions of people over the last decade. To mark Pension Awareness Week, we’re highlighting how to help close the gender pension gap and ensure female employees and pension scheme members have a secure retirement.
A gender pay gap is a complex issue to solve and it’s likely there will always be a gender pensions gap. However, there are actions pension schemes and companies can take to drive change. The most important thing is providing the financial education and information for women from early on in their careers.
There is no silver bullet to unlocking the problem – but here are six ways to support current and future female pension scheme members:
- Raise awareness with younger women – from nurturing daughters about future careers and talking about roles in a gender-neutral fashion to supporting and engaging younger female members in saving money so they can get a head start in their twenties.
- Speak to members – explain how much they are paying into their pensions from their salary, how much their employer is paying in and how much the government is contributing through tax relief. For most people, saving into a workplace pension should mean they can expect somewhere between a minimum and moderate standard of living. Regular benefit statements don’t have to be provided to all members of all types of pension scheme, but a good benefit statement can be really powerful so think about whether you should be sending them.
- Talk about pensions at home – when deciding which parent should take on the caring responsibilities, consider important pensions issues such as long-term earning potential, workplace specific pension benefits and even the benefits of joint annuities. They can have a big impact on retirement plans. Talking about pensions with your family and friends helps everyone build an understanding.
- Educate members on what they can do to improve their retirements – look at your pension communication strategy. For example, Scottish Widows has lots of useful information on its Future Planning Hub and other big companies have a bounty of material that can help support employee education. Or work with your provider, professional trustee or pension communications consultant.
- Explain how much women will need for a decent retirement – according to the Pensions and Lifetime Savings Association Retirement Living Standards, the minimum a single person needs in retirement is £12,800 a year, so the State Pension gets people almost there. However, £23,300 a year is needed for a moderate lifestyle and £37,300 a year for a comfortable one.
- Track down past pensions – with house moves and busy family lives, it is easy to lose track of pension pots. Signpost members to the Government’s Pension Tracing Service to help them find a lost pension.
Pension trustees can support female members in many ways to help ensure they have a plan for retirement but, first, start educating women by pointing them to the live sessions that Pension Awareness are running this week so they can focus on their finances for the future.
