Did you know women are expected to raise on average £47,000 less over the course of their workplace pensions than their male counterparts?
And did you know the current model, which has only recently come into force, doesn’t take account of people who work multiple jobs that each fall below the pension threshold?
Research from insurance specialist Zurich shows that – while the workplace pension will be great news for many employed people – there are some in the national workforce who may fall through gaps in the system and, as such, miss out on substantial amounts of money.
In particular the report highlights:
- Over 100,000 people do not reach the £10,000/year threshold for auto-enrolment pension in a place of work
- This can be because they work for several employers, whereby their total income may exceed for £10,000 but they will not qualify for any individual scheme
- Those who take career breaks will be more likely to miss out
So why does this particularly affect female pension-earners? The report shows that between 2013 and 2016 men received 7.8% of their salary in pension contributions (on average), compared to women received just 7%. It’s because they’re more likely to have lower salaries in the first place (the wage gap still a very real part of everyday life, sadly), are more likely to take career breaks (ostensibly for raising children) and are more likely than men to work multiple jobs.
Rose St Louis of Zurich Insurance commented: “The ‘triple effect’ of smaller salaries, career breaks for women and lower contribution rates needs to be addressed: we can’t ignore a £47,000 shortfall. This difference in the contributions that they receive from their employer presents a serious – and growing – problem.”
In our opinion it’s important to not only be aware of your workplace pension rights, but also to understand that the scheme might not be sufficient for you to enjoy the kind of retirement you would like. There are alternatives or supplementary methods of retirement saving, and you’re likely to benefit financially from speaking to an expert.