Over half of women expect to run out of money during retirement, according to new research from Fidelity.
In addition, more than one in 10 women in the UK have reduced their pension contributions, despite more than half fearing they won’t be able to financially sustain their retirement, a new study by Fidelity International has revealed.
According to the findings from Fidelity’s annual Women and Money study, 12% of women have reduced their pension contributions due to the cost of living crisis over the past 12 months by an average of £173 a month.
Just over half (51%) of working women said that a lack of available funds after covering essential expenses had prevented them from saving more into their retirement fund, while 22% have redirected funds towards other savings goals.
However, Fidelity warned that these decisions exacerbate the gender pensions gap which disproportionately affects women. In 2024, the average pension pot of non-retired men aged 55 and over was £114,000 while women of the same age had a pension pot worth just £66,800.
Jackie Boylan, head of investor servicing at Fidelity International, said: “The most recent data underscores the stark reality many women face as they navigate a complex financial landscape. The cost of living crisis has resulted in many women prioritising their most immediate financial needs, putting their longer-term financial future at risk.
“With so many women feeling concerned that they will not have enough money to sustain their retirement, we must take action to provide better financial education and support systems to help women navigate these challenges.”
Boylan said despite challenges faced by women, small changes could still have a significant impact on their long term savings. Its analysis shows that a 45 year old woman earning an average salary of £28,765 could save an additional £17,000 in retirement savings by increasing contributions by 1%. An increase of 3% could see savings grow by an extra £51,100.
For a 25 year old earning the same salary, contributing an extra 1% could lead to an extra £74,000 in retirement, while a 3% increase could result in £222,100 more by retirement age.
Boylan added: “Our data shows that it is never too late or too early to make meaningful changes to pension contributions. Even starting later in life, the effect of small, regular increases can significantly enhance financial security in retirement. For younger savers, beginning early and making consistent contributions, no matter how small, can result in a substantial retirement fund.
“Closing this gap is a crucial step towards achieving economic equality and requires proactive measures to ensure that all individuals, regardless of gender, can retire with confidence and security.”
