Tips from a Female Financial Adviser on how to close the Retirement Gender Gap

As a woman in the financial advice industry, I am well aware of the different challenges we face when it comes to retirement planning.

Recent press coverage has highlighted inequalities once again via a report published by Now: Pensions. They found a woman retiring at the age of 67 in 2026 would have saved an average of £69,000 compared with £205,000 for the average man. This means we would have to work an extra 19 years for the same retirement pot!* The good news is, this doesn’t have to be the case. Putting just an extra £50 per calendar month, or whatever you can afford, from an early age, together with the power of compounding up, would make a significant difference to your retirement pot.

Quite rightly, us women are increasingly striving for more financial independence and equality. So, it is crucial to understand the importance of saving for your future and how your pension fits into this.

So why do we have less?

The typical reasons behind this gap range from career breaks and cutting hours to look after our children or elderly relatives, to the wage gap when we return to full time work. This data is particularly worrying when you consider that typical life expectancy for us women is higher than men, therefore our pension must provide for a longer time.

Right now, some women don’t put enough into their pensions because any ‘spare’ money goes on their children, home improvements, caring for relatives or family holidays. This on top of the retirement gender gap mentioned earlier can be significant.

So what can we do?

1. Start early: The power of compound interest is proven, so starting to save as soon as you start working can give you a real boost later on.
2. Keep up your contributions: This can be tough when your earnings take a drop, but continuing to contribute, even at a lower rate can prove to be valuable in later life.
3. Employer matching/salary exchange schemes: if these are offered by your employer, they can be great for additional contributions. Check what levels are matched and if your employer will contribute the national insurance savings to your plan. However, take care if you are applying for a mortgage or about to go on maternity leave as salary exchange can affect these.
4. Investment diversification: Ensure your schemes are working hard for you, whether you talk to a professional or do your own research, ensure the funds selected within your pensions suit your needs.
5. Regular reviews: Check in and adjust as your financial circumstances and goals can change over time. It's essential for us all to regularly review our pension saving strategies and adjust as needed.

   Let’s face it, these inequalities aren’t fair, and public awareness can only help our case. In the meantime, what you can control is your own financial planning. By being proactive and addressing your pension needs early, you can be in a better position for a financially secure retirement.

   The value of an investment with St. James's Place will be directly linked to the performance of the funds selected and may fall as well as rise. You may get back less than the amount invested.

   #FemaleFinancialAdviser #RetirementPlanning #GenderEquality

   *Source: The 2024 gender pensions gap report. NOW. Pensions, February 2024.

   By Leighanne Metcalfe

   Financial Adviser

   HJP Chartered Financial Planners

   To find out more about Leighanne;click here

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