Women hit with double whammy on pensions says Aegon's Smith

As the world marks Equal Pay Day today, Aegon’s head of pensions Kate Smith says women are being hit by a double whammy on pensions and pay.

She say lower earnings for women mean they are effectively “on the back foot” when it comes to pensions.

Equal Pay day is the day when women stop earning in the year compared to men. The event has been marked by walk outs by some women around the world.
Commenting on Equal Pay Day she said that today didn’t just mark the point when women stopped earning relative to men, it also marks the time when the gender pay gap means that for the next 35 working days women will be effectively making lower personal pension payments and employer contributions are also lower.

She said : “If you’re a woman in the UK, today marks the point in the year when you stop earning relative to men. The gender pay gap means that for the next 35 working days you’re effectively not earning any money.

“As shocking as this is, the impact doesn’t just affect take home pay. A lower overall salary also means personal pension payments and employer contributions are lower, because typically this is calculated based on income.

She explained that set against a retirement savings journey disrupted by maternity leave, this puts women on the back foot from the day they start working, and means women save an average of £1,020 less each year compared to their male counterparts.

She added: “As if this wasn’t enough, reforms to equalise both the age at which state pension can be accessed and the number of qualifying years of National Insurance contributions, means women are being hit with a double whammy when it comes to retirement saving.

“It’s absolutely crucial that employers across the UK take this inequality seriously, and government carefully considers these imbalances when setting pension policy.”