What’s the magic trick to get young people interested in pensions?
The answer of course is that there is no magic solution. It’s a rare 23 year old who thinks about being over 40, and retirement is an incomprehensible future away. Do you remember being 23? I do, and I remember struggling every month to pay the bills. When my boss suggested it would be a good idea to join the company pension scheme, not least because my employer would make contributions too, I said “No thanks”.
Three decades on of course I can see that I should have foregone a few drinks with my mates after work each week and joined the scheme even if my contributions initially were tiny — but that’s the wisdom of hindsight.
As today is International Women’s Day, I’m particularly struck by the evidence on the inequalities in women’s pensions. Did you know that more than 65% of pensioners who live in poverty are women? And women pensioners’ weekly income is only 85% of men’s?
This new report out from Scottish Widows shows that in the UK, when women retire they have £100,000 less in their pensions savings compared to men. This is despite the fact that women are doing our best to help ourselves — saving more than ever, with 59% of women over 30 saving enough for their futures.
When I gave up my full-time job last year to study for a Masters degree in AI and Data Science I stopped paying in to my personal pension — and it was not a decision I took lightly. I look forward to earning enough to start saving again. Whether through taking time to bring up children, inability to earn a living during the COVID-19 lockdowns, taking time off to study like me or just earning less than men, the layering of factors results in too many women facing an impoverished future.
For as long as women are the ones who have babies, it’s inevitable that our years of working and being able to save for the future will be less than men’s. Even if we had pay parity (and we are a long way off that), there’s no way by ourselves that we can save the same as men.
Although my instincts are always for freedom to choose, I believe the only solution is for there to be more compulsory pensions savings and for the state and employers to top up women’s pensions. The theme for International Women’s Day is #ChooseToChallenge so who will take up this challenge?
I don’t kid myself that this would be a vote grabbing proposition — and the beneficiaries are far in the future — so what flavour government is going to make this happen? But it’s still more likely than young people voluntarily saving enough for their futures.
#ChooseToChallenge
#IWD2021
#GenderPensionGap
