The gender pay gap is following women in to retirement as a new report confirms that their income will be 29% less than that of men.
Their retirement income is likely to add up as an average £4,900 a year lower than that received by men.
And one in six retiring women will have incomes below the minimum income standard set by charity the Joseph Rowntree Foundation – but only 10% of men are below this level.
But astonishingly, this is the highest retirement income ever for women, says a study by pension provider Prudential.
Financial gap closing
The average retirement income for women retiring in 2018 is £16,900 a year – compared with £21,800 for men.
The gap between retirement money for men and women is the second narrowest recorded in the past 11 years. In 2015, the difference was £4,800, says the Prudential.
In 2008, the gap was a massive £9,800 or giving men an average 84% higher income in their later years, which means the gulf between the genders has closed by more than half in the intervening period.
The financial prospects in retirement have increased considerably in 12 months, with women 32,600 a year better off against £1,150 for men.
Kirsty Anderson, a retirement income expert at Prudential, said: “The retirement income gender gap is still too wide, at nearly £5,000, with women struggling to match the incomes generated by men.
Positive future
“However, it is really encouraging to see that the retirement income gender pay gap is shrinking over consecutive years and women are starting to close the gap on men. It is also extremely positive news that expected retirement incomes this year are the highest on record.
“As working patterns continue to change and become more flexible and shared parental leave is more widely encouraged by the government agenda and employers, the future looks positive for narrowing the retirement gender gap.
“It can be difficult to justify any extra expense when taking a career break, but it is extremely important for anyone taking time out of work to maintain their pension contributions. Saving as much as possible as early as possible is the best way to secure a good quality of life in retirement.”
