A new report is examining gender equality and how government policy can make sure women don’t lose out financially as we live longer. The report, by a think tank called the Social Market Foundation, looked at different moments in women’s lives when they can lose out financially, compared to men. Here are its findings.
Training/studying and starting or re-entering the workplace
Women do well at school and university, but fewer girls/women than boys/men study STEM (science, technology, engineering and maths) subjects. While the gender pay gap is small or non-existent in early working years, it widens as women get older.
Relationships, motherhood and becoming a carer
The divorce rate is declining for couples under 45, but not for older couples. The report quotes official government figures that show that married couples over 50 have three times as much pension as the average divorced woman over 50.
Women are increasingly having their first child later in life, which could mean they are less affected by the gender pay gap. However, women are still more likely to be expected to care for elderly relatives.
Later life, retirement and ill health
Things like the gender pay gap and its impact on pension saving, plus the fact women are still much more likely than men to take time out of work to look after children, both affect women’s pensions and retirement plans. Women who can’t carry on working because of their caring commitments will not only lose out on a workplace or private pension, but may lose out on state pension credits as well.
What the report recommends
The report says that the government should take some specific steps to improve the financial wellbeing of women and to reduce gender inequality. In particular, it should:
Give employees the right to request flexible working from the first day. At the moment, you have the right to ask if you can work flexibly once you’ve been in your job for at least six months. The Social Market Foundation thinks this right should apply from day one.
Get employers to spell out if jobs can be done flexibly or part time, in the job description.
Get employers to publish their pension policy when advertising job vacancies.
Pay the (private/workplace) pension contributions of women who leave work to have children or care for a family member.
Get the financial regulator, the Financial Conduct Authority, to publish data on what people do with their pension pots when they retire. This data should be broken down by gender.
What you can do now
Find out if you can work flexibly. Not all employers offer flexible working, but some take a more enlightened approach. Sometimes employees aren’t aware of their right to ask for flexible working, or are afraid that doing so will damage their career prospects. You can find out about your rights when it comes to flexible working in my article.
Find out if you can pay extra into your workplace pension. If you’re employed or on a contract, the chances are that you’ve been automatically enrolled into your employer’s pension scheme. If you can afford it, find out if you can make extra payments into your employer’s pension and if they will make any extra contribution into your pension if you do.
Don’t miss out on things like Carer’s Credits. If you care for someone for more than 20 hours a week, you may be able to get national insurance credits towards your state pension. You can also get credits if you have children – up until your youngest child is 12 (as long as you register for Child Benefit).