Gender Pension Gap Driven by Systemic Barriers, Not Confidence Issues
A groundbreaking report has challenged entrenched stereotypes about women's financial capabilities, revealing that the substantial pension wealth gap between genders stems from systemic inequalities rather than any perceived lack of confidence in financial planning.
Stark Disparities in Retirement Savings
The study, supported by wealth management firm Evelyn Partners, highlights alarming disparities in pension wealth accumulation. Government figures indicate that by age 59, men hold a median average of £75,000 in defined contribution pension wealth, while women average just £19,000 in the same category. This represents one of the most common types of private workplace pensions in contemporary Britain.
Women face disproportionate challenges regarding under-saving for retirement, with multiple structural factors contributing to this growing concern. The gender pay gap remains a significant driver, compounded by employment interruptions and part-time work patterns often associated with child-rearing responsibilities.
Unmasking the 'Confidence Gap' Narrative
Report author Emily Shipp, a psychologist and associate of the Edinburgh Futures Institute, argues that the pervasive 'confidence gap' narrative has obscured the real systemic, situational, and social factors creating what she describes as a 'pensions gulf'.
'Financial services often interpret women's behaviour as caution, risk aversion or low confidence,' the report states. 'When we place these behaviours in context, a new picture emerges that more meaningfully guides supportive actions.'
The research contends that women have fewer opportunities to practice long-term financial decision-making due to gender inequalities in income, available time, and uninterrupted work years. Furthermore, the persistent belief that men possess greater financial competence continues to influence women's financial behaviours and societal expectations.
The Hidden Burden of Unpaid Labour
A crucial finding reveals how the mental load and time scarcity operate in tandem to disadvantage women financially. Women are more likely to carry the ongoing cognitive labour of anticipating and coordinating care for family members while spending significantly more time on unpaid domestic work.
'These pressures reduce both the mental bandwidth and the available time needed for sustained engagement with long-term financial planning,' Shipp explains. 'This reflects overload, rather than lack of engagement.'
The report emphasises that the continuous work of anticipating, planning, and caring for others consumes the same mental resources required for future financial planning, creating a substantial barrier that has been largely overlooked by financial institutions.
Outdated Financial Systems Require Modernisation
Historically, financial advice and pensions policy have centred on typically male, linear career trajectories and financial goals rather than the multi-phase, care-interrupted lives many women navigate. As people live and work longer, often pursuing multiple careers, the financial system must evolve to accommodate these changing patterns.
Emma Sterland, chief financial planning officer at Evelyn Partners, welcomed the report's insights: 'Its thought-provoking findings challenge entrenched narratives around women and wealth, shining a light on the complex structural barriers that women face as they build their financial security over a lifetime.'
Calls for Systemic Reform
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, emphasised that meaningful change requires initiatives to help women remain in the workforce. 'This includes the provision of more flexible working practices such as working from home and the ability to fit work around caring responsibilities more easily,' she noted.
Jenny Ross, Which? Money editor, added: 'Inadequate pension savings can have devastating consequences for quality of life in retirement, so it's essential that more is done to address the systemic issues that prevent many women from building a pension pot to match their male peers.'
The report concludes that redesigning pensions policy and financial environments to better serve varied priorities and life courses would benefit all genders as society moves toward longer, multi-phase lives. Without such action, experts warn of a looming 'pensions timebomb' that could disproportionately affect women's financial security in later life.
