Signs of pension gender gap narrowing, reports LEBC
7 August 2019
Adviser group LEBC says it has seen the gender pension gap narrow amongst annuity purchasers, down from 31% in 2018 to 20% this year.
The average female client had a pension pot of £150,792, up from £114,236 the previous year but male pension pots still continue to be greater, with the average pot residing around £188,545, up 14% on 2018 figures.
It also saw the value of pension pots used to buy an annuity jump by 17% year-on-year. In the first four months of 2019, the group saw the average pension pot used to buy a lifetime guaranteed income reach £176,532, marking a sixth successive year of growth.
However, LEBC noted that women do not make the most of the firm’s shopping around service to improve their pension income, with women accounting for less than a third (31%) of those using the offering.
Kirsty Turner, of LEBC’s The Retirement Adviser, said in failing to shop around, a healthy 65-year-old could lose up to 8.25% of annual income for life.
She said: “For those with health or lifestyle issues, which may affect their expected lifespan, the difference can be even greater. For example, those who are smokers may expect 11.3% more than a non-smoker. Multiple health issues will qualify a person for higher income still, and at present more than 62% of clients who use LEBC’s service obtain an enhanced income due to health and lifestyle factors.”
Turner added: “As well as helping retirees to secure the most income with their pension pot, our service entails looking at the future needs of dependents and the need to inflation-proof income, so that the income bought can be tailored to the individual’s needs.”
LEBC has published a free guide to help women learn about the ways in which shopping around can improve their retirement income and the many other ways in which they can make up for lost years of saving. The guide is available free at [email protected]
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