The gender pension gap. What is it and what can you do?


Published  28 May 2024
   4 min read

Clare Moffat, our pension expert, discusses the gender pension gap and the affect it can have on your retirement. 

You’ve probably heard about the gender pay gap, but have you heard about the gender pension gap? In recent years, there’s been significant progress in reducing the gender pay gap and promoting gender equality in the workplace. But when it comes to retirement planning and achieving financial security in retirement there hasn’t been as much progress. 


What is the gender pension gap?

The gender pension gap is the difference between men and women’s pension wealth. This can be the difference in pension pots that men and women have at different points in life, or the difference in the amount of annual income that men and women have in retirement.

Whichever measure is used, one thing that is clear. Women retire with significantly less pension savings than men.

A survey by the Department for Work & Pensions, found that the gap in private pensions is currently 35%1. This means that for every £100 a man has in pension savings, a woman will only have £65. As women tend to live longer than men, and their pension savings need to last longer, this is a real concern. If you don’t have a private pension then the alternative is the state pension. We found that nearly one third of women1 will live solely on the state pension compared to 13% of men. The maximum State Pension is currently £221.202 a week which isn’t a lot of money to live on for the rest of your life.


Why does the gender pension gap exist and what’s the link to the gender pay gap? 

The gender pension gap is the result of several factors. One of which is the gender pay gap – the difference between the average hourly earnings for men and women. There are historical reasons the gender pay gap exists such as fewer women being in the workforce, unequal pay and breaks in employment due to caregiving responsibilities.

Legislation has helped to equalise pay and as a result the gender pay gap has decreased over the years. However, women often work in lower paid industries, and lower pay, usually means lower pension contributions.

But the gender pension gap isn’t just about lower pay, and this is why the gender pension gap isn’t reducing as quickly as the gender pay gap.

We carried out research in Autumn 2023 to understand and identify the main causes of the gender pension gap.

The key areas where differences between men and women were identified were in relation to financial confidence, breaks in employment while providing care, either as a parent, grandparent or caring for elderly relatives, the impact of menopause symptoms, and divorce.

We also considered financial resilience. Women tend to have fewer assets than men to fall back on if they can’t work. Statistically, a 30-year-old women is around 42% more likely than a man to be off work for 2 months or more3.

Policy changes by the government may be needed to help drive a reduction in the pension gap, but this won’t happen overnight.  


What can you do? 

Retirement can seem very far off if you’re in your twenties or thirties. There may be other financial considerations like renting or buying a home, university debt and increased bills but the sooner you start paying into a pension the better. 

When you pay into a pension you receive tax relief from the government plus an employer contribution, and that money is then invested. As with all investments, pension savings need time to grow so the sooner you start saving the less you’ll need to contribute each month to reach your retirement goals. 

If you delay saving into a pension until you’re in your forties for example, you’ll have to save a lot more every month to reach the same amount in retirement.  

Understanding your finances and how your pension works early on in your career, can help you feel better equipped to make good financial decisions as your life grows and changes. 

If you’re thinking about stopping or reducing your working hours, for example after having a baby or to care for elderly relatives,  then it’s important to remember that this will have an affect on your pension savings and your life in retirement. Having that knowledge means you can make a fully informed decision. If you then increase your working hours at some point in the future – you might prioritise paying more into your pension then. 


1 Department for Work & Pensions, The Gender Pensions Gap in Private Pensions, 5 June 2023 
2 The new State Pension: What you'll get - GOV.UK (, June 2024. 

3 Both aged 30, non-smokers, planned retirement age of 65. *Pacific Life Re, June 2021. These figures have been produced based on their interpretation of the Institute and Faculty of Actuaries’ Continuous Mortality

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