Financial advisers should help women make the most of personal allowances and reassess their concept of risk to help close the pension gender gap, according to investment platform Parmenion.

According to the company, financial advisers should engage with women to educate and inform them about how financial markets behave.

They should also spend more time explaining volatility, the effect of time on investments and how viable their income requirements will be if they go through their accumulation stage at different risk grades.

In an article for its digital newsletter, the investment platform said that while the pension gap was intrinsically linked to earnings, it was also important to consider behavioural factors which may lead women to allocate more of their savings to lower risk assets such as cash.

The platform said that while pay disparity is not something an individual woman can change, the pension disparity seen today is a different story.

The article is part of an #AdviseHer series of articles designed to help financial advisers level the gender playing field when it comes to investing. Previous topics they have covered include an article on why women are leading the way in ESG investing written by Financial Planning firm Paradigm Norton, and how the Coronavirus pandemic is proving a setback for women's finances.

Abika Martin, investment manager at Parmenion, said: “In our society, half the participants earn less, save less, and save less effectively, and to make matters worse, that same half of the population happens to be the one with the higher life expectancy. So that smaller pot, which isn’t growing as much, also has to last longer.

“We know women tend to invest in a more risk averse way to men, but is this a biological aversion or just a by-product of a lack in understanding? Studies have shown women are more inclined to make financial decisions based on their understanding of the risks involved, and that it’s transparency of other information such as charges, rather than the price itself, which drives their decision making.

“It stands to reason that women want to make the most of their money – but first, they want to understand how.”