“A man may work from sun to sun but a woman’s work is never done.”
The old saying has never had a stronger ring of truth than since the changes to the state pension age. Over the past ten years, there has been an equalisation of retirement ages between men and women and by the end of this decade they will have gone up to 67.
However, the pay gap between the sexes has not narrowed at the same pace, meaning that many women are going into their golden years with less money than men – even if they have worked in similar jobs. Indeed, new analysis from the Centre for Economics and Business Research found that, when life expectancy is taken into account, the gender pensions gap could be as much as £108,130 for single women, and £186,120 for women who are married or in a relationship.
The presumed consequence is that, for the first time in British history, there are more women aged 60 to 64 in work than not. Indeed, the number of older women in work has increased by 51% since changes to the state pension age were introduced in 2010, according to date from the Office for National Statistics. This contrasts with an increase of 13% in the number of working men aged between 60 and 64 over the same period.
The fear is that women are having to make up for the shortfall in their pension pot by working longer. Their worries are exacerbated with the thought that women live longer than men. Indeed, a 40-year-old female has a one-in-four chance of living until the age of 96. This longevity means that they are likely to be having to support themselves for longer and are often alone in later life.
It is also worth taking into consideration the issues faced for those in same-sex relationships. They face the same challenges multiplied by two.
We are taught to save early in order to enjoy the fruits of our labour when retirement comes, however it is now the case for many that they have to choose between their health and their financial stability when working for longer to reduce the shortfall.
It is important to assess whether your current plans will enable you to meet your retirement goals, and your adviser will be happy to sit down and discuss this with you. Together, we can help make your money work harder.