Mind the pensions gap – helping men and women save enough

MoneyPlus Features Team

Men are from Mars and women are from Venus… or so the self-help book of the same name would have us believe. But in the 26 years since it was published, times have changed, and in 2018 the idea that men and women are so far apart they might as well be different species is considered outdated.

But there are still differences. Not least the gender pay gap which continues to dominate the news. And there’s another important one: saving for the future.

Identify that gap

According to a recent report, 15% of men have saved more than £300,000 into a pension, compared to just 4% of women, and women are half as likely as men to feel sure that they’ll be able to retire comfortably.

There are some clear reasons why. Women are still more likely to be paid less, work part-time, care for children or other family members and take maternity or career breaks.

And that means they often save less into their own pension pots throughout their lives.

But it looks like change is in the wind, according to the Government-backed pensions group NEST (National Employment Savings Trust). Almost three million women earning between £10,000 and £14,999, have, on average, 20 per cent more saved than men with equivalent salaries.

It’s all about financial independence.

The reality is that most people, whatever their gender, want to have enough money saved for a life after work so that they can indulge their passions, spend time with family and friends, study or travel. For some it’s about having enough to retire early or not to have to rely on the State Pension.

Whatever your circumstances, the good news is there are some smart – and sometimes not so well-known – ways to help boost your savings. Here’s our guide to just a few:

Get engaged with your money – and keep track

It sounds simple, but make time to think about your savings and the effort to save what you can.

Get to know how much you’re saving into your pension and how your savings are performing – that’s because they’re invested, usually in funds, so that they’ve got the potential to grow over the long term.

Of course, those savings can go down as well as up and you could get back less than was paid in.

Using technology to keep track of your pot makes it easy – download our app and keep in touch with your savings when you want and while you’re on the go.

Make the most of what you’re entitled to

Part-time or full-time: make the most of your workplace pension

The workplace pension has opened up saving to more than 9.5 million people in the UK thanks to auto-enrolment.

Part-time or full-time, you’re automatically joined as long as you earn at least £10,000 and meet certain conditions.

You contribute, as does your employer – and you usually get tax relief on what you save, based on the rate of income tax you pay of 20%, 40% or 45%. Bear in mind that if you’re in Scotland different rates of income tax apply.

So if you contribute £100 a month it actually costs you just £80 as a basic-rate, 20% taxpayer, or £60 if you’re a higher-rate taxpayer. The tax-relief helps to make a pension such a great way to save as our Boost your savings with the ‘magic’ of tax relief article explains.

If you’re a higher or additional rate taxpayer you may need to claim back anything above the basic rate direct from HMRC. There are some limits – but at £40,000 a year or up to 100% of your earnings (whichever is lower), it’s a generous annual allowance.

Be aware that tax and legislation can change in the future and will depend on your individual circumstances.

If you’ve been out of the job market for a while, or you’re new to the workplace, you might not be up-to-speed on the benefits of a pension, so make sure you get informed and can make the most of it. Ask your employer and read ‘What’s so good about a pension?’

If you’re a parent, it might make sense to consider continuing to contribute while you are on maternity or paternity leave if you can, so that you get your employer’s contributions.

Protect your future State Pension

Parents: how claiming child benefit can help your State Pension

If you have children and you’re part of a couple where one earns more than £50,000, you start to lose some child benefit through a High Income Child Benefit tax charge. The tax cancels out the benefit when one parent earns £60,000.

It’s one reason why half a million women opted out of receiving child benefit in 2017 and although it affects men too, it’s less of an issue.

While this might save on the need to complete a self-assessment tax form, there’s a knock-on effect not many people know about.

Claiming child benefit, even if you choose not to receive it, or end up having to pay some or all of it back through the tax charge, can help you build your State Pension because it will give you National Insurance credits which count towards it.

So with that in mind, do make sure you claim for child benefit by filling out the form on

Working age grandparents could get a State Pension boost too

It’s been in the news a lot this year in a bid to raise awareness and ensure people don’t miss out.

Many working-age grandparents – often women – who look after a grandchild instead of doing paid work can lose out on some of their State Pension because they don’t have enough years of National Insurance contributions.

As explains: “Grandparents Plus and Age UK have estimated that the childcare they provide is worth £7.3 billion a year. Millions of parents are struggling to afford formal childcare and rely on grandparents to help out.”

But there is a way they can boost their State Pension through a Government scheme which offers National Insurance credits for carers if the child is under 12.

Working parents can transfer the NI credits they receive and donate them to their child’s grandparents – or another family member, if they are the carer.

As long as the parent is working, this shouldn’t affect their own entitlement to a State Pension.

To read more on this and to apply to do this, go to

Men and women, young and old – a few smart decisions now could make a difference and help you look forward to enjoying the lifestyle you’d like in the future.


Elle Tucker is a freelance journalist.

A pension is an investment and its value can go down as well as up and may be worth less than was paid in. The information here is based on our understanding in September 2018 and shouldn’t be taken as financial advice. Personal circumstances also have an impact on tax treatment.