Gender savings gap closing as Scottish women beat national average of retirement savings

According to the latest Scottish Widows Women & Retirement Report, while women in Scotland are lagging behind their male counterparts – 63 per cent of whom are saving adequately – the gender gap has closed since 2015, when 51 per cent of women of women in Scotland were saving adequately compared to 62 per cent of men.

Optimism levels are also higher among women in Scotland compared to the UK as a whole, with 32 per cent of women in Scotland saying they feel positive about their retirement, compared to a national average for women of 27 per cent.

Across the UK, shifting patterns in employment among women appear to be impacting their ability to save for retirement. Close to 1.5 million women in the UK are now self-employed – a 22 per cent increase in four years and twice the rate of self-employed men.

Just over a third (36 per cent) are saving adequately for retirement, compared with 47 per cent of self-employed men and 58 per cent of employed women. The findings suggest this trend is set to continue, with over three-fifths (62 per cent) of self-employed women claiming they don’t think they will be able to save any more in the next 12 months, compared with less than half (46 per cent) of men in the same position.

Additionally, with 16 per cent of women working part-time, a significant proportion could be exposed when it comes to saving for their retirement due to the fact that automatic enrolment is only triggered when employees earn £10,000 a year or more.

Twice as many women as men (6 per cent versus 3 per cent) are working at least two jobs, yet still failing to qualify for automatic enrolment as the amount they earn from each is below the £10,000 threshold.

Women also appear to be more negatively impacted by their personal circumstances than men, with only 42 per cent of divorced women in the UK saving adequately compared with 47 per cent of divorced men. Divorced women have a bleak outlook on their financial futures, with seven in 10 (70 per cent) thinking it is unlikely that they will be able to save more in the next 12 months than they do now – compared with an average of 68 per cent overall.

Younger women are the least optimistic about their retirement, with only 18 per cent of women aged 18-29 feeling positive compared with 25 per cent of men in the same age group. The findings suggest that a lack of understanding of retirement planning is to blame; a third (33 per cent) of 18-29 year old women claim that they would be encouraged to start saving if they had better access to information on pensions or retirement planning.

Two-fifths (42 per cent) aged 22-29 would be encouraged if they could see the value of their pension alongside their other savings, either online or via an app.

Automatic enrolment could be particularly effective for young female savers with one third (33 per cent) of 22-29 year olds saying it would encourage them to start paying into a pension, compared to 29 per cent of men.

Jackie Leiper, retirement expert at Scottish Widows, said: “It is encouraging to see that women in Scotland are doing so well in saving towards their retirement, but more needs to be done to combat the gender gap in adequate retirement savings. It’s vital that we address this to ensure women feel reassured about their finances and prepared for retirement, whether they are self-employed, work for a large employer, are divorced, married or single.

“More also needs to be done to make certain that automatic enrolment does not marginalise female savers who may not qualify for the threshold. And this means we need to engage innovatively with female millennial savers, who are just beginning to put money aside for their retirement. Our research shows they are crying out for information, and learning good savings habits now will help ensure they are better prepared for later life. Providers, employers and the government alike must also explore further initiatives to help women of all ages save in other ways if they don’t qualify for a workplace pension.”