The UK retirement gender gap is £6,700 a year as women’s expected annual retirement incomes are 35% lower than men’s.
According to research from a financial services firm, men have annual expected retirement incomes of £18,900 ($31,765, €22,970) compared with £12,200 for women in 2014.
But despite the widening gap in expected retirement incomes, the study explained that there is some comfort for this year’s female retirees.
At £12,200 women’s average expected annual income is £450 higher than it was in last year’s study.
However, a man’s average expected annual retirement income has grown by £650 since last year to £18,900.
“It is welcome news that average expected retirement incomes have increased for both men and women, but concerning that the gender gap remains stubbornly wide,” said Vince Smith-Hughes, retirement income expert at Prudential.
“There are also some specific practical steps that women can take today to improve their retirement incomes in the future.
“These include maintaining pension contributions where possible during career breaks and making voluntary additional National Insurance Contributions when returning to work.”
Prudential said the gender gap peaked in 2010 when men’s expected retirement incomes were larger by £7,400.
This year’s gender gap shows a rise of £200 since last year and is now at its widest since the 2010 peak.
Prudential’s study also found that only 41% of women planning to retire this year feel financially well-prepared for retirement, compared with 54% of men.
Just 29% of women believe they will have enough income to enjoy a comfortable retirement, compared with 47% of men.
In the North West of England the retirement income gender gap is narrower and women’s expected incomes are higher than anywhere else in the UK – women expect to retire on £13,850 a year, just £1,500 less than the figure for men (£15,350).
The gap is widest in London where the average expected retirement income for women of £10,500 a year – the second lowest in the country – is only 43% of that expected by men (£24,500).
Women’s expected retirement income is lowest overall in the South West, at £9,650 a year.
The figures come after the government’s radical retirement reforms, which will enable anyone over the age of 55 to take their whole pension pot as cash from April 2015.
The move from the Chancellor George Osborne means retirees will no longer have to take a compulsory annuity purchase in order to avoid a huge tax bill.
Source: International Business Times – http://www.ibtimes.co.uk/uk-retirement-gender-gap-hits-6700-year-women-miss-out-35-1446460
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