A staggering one in four women in the UK have never heard of pension tax relief, according to alarming new research. This financial blind spot could cost female savers thousands of pounds in lost retirement income.
The Hidden Retirement Crisis
The study by Opinium for Hargreaves Lansdown reveals a concerning knowledge gap:
- 25% of women are unaware of pension tax relief
- Only 56% understand how it works
- 34% of men also lack knowledge about this key benefit
What You're Missing Out On
Pension tax relief is essentially free money from the government. For basic rate taxpayers, every £80 contributed to a pension becomes £100 through tax relief. Higher earners can claim even more.
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, warns: "This lack of awareness is particularly worrying as women typically have smaller pension pots. Missing out on tax relief makes it even harder to build adequate retirement savings."
Closing the Gender Pension Gap
The research highlights several key issues:
- Women's average pension pots are significantly smaller than men's
- Career breaks for childcare reduce contributions
- Lower average earnings mean less employer matching
Financial experts are calling for:
- Better financial education in schools and workplaces
- Clearer communication from pension providers
- Targeted government campaigns
Morrissey adds: "Understanding pension tax relief is crucial. It's one of the most valuable incentives for retirement saving, and people should take full advantage."
