Some 25% of women do not know the value of their pension pot or their retirement income versus 15% of men, despite an average annual income of almost £5,000 lower than their male counterparts, according to research from Fidelity.
Fidelity International’s class of 2015 interviewed 510 people who have retired or accessed their pension pots since the introduction of pension freedom and found that not only are women less aware of the value of their pension than men, they are less likely to seek advice.
Some 25% said they found the financial planning process difficult compared with 16% of men, and only 36% of women have sought help from a financial adviser versus 46% of men.
Additionally, women are more likely to seek financial advice from friends and family rather than an adviser with 21% saying they would do this versus 13% of men.
The average retirement income for women is expected to be about £18,334 – £5,000 less than men – meaning, arguably, that the financial performance of their pension pots will have a more significant impact on their lives.
But even when women do seek advice to, for example, consolidate their pension pots, the key driver was the desire to have everything in one place at 44%, while for men the majority, at 52%, said they were looking to enhance performance. Only 20% of women said this was their main driver.
Fidelity International investment director Maike Currie said: “The pension savings ‘gender gap’ is well documented and comes from historical differences in working patterns.
“But several factors mean these findings are problematic. Women, on average, are expected to live for longer than men meaning we should have more retirement savings because we will need an income for longer.
She added: “An increasing number of women are now single and/or divorced in later life and cannot rely on a partner for an income in retirement. In the UK it is expected that almost half (42%) of marriages will end in divorce with the average age at divorce being 45 for men and 42 for women.”
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