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Insuring Women's Futures, #MomentsthatMatter, CII, women’s pensions, women's financial resilience‘There is much to be done to improve women’s pensions and financial resilience generally’.

Insuring Women’s Futures is an initiative established by the Chartered Insurance Institute (CII) as part of the its ‘Insuring Futures’ programme, bringing together the insurance and personal finance profession to tackle the challenges that women face when it comes to establishing financial stability.

The Insuring Women’s Futures Market Task Force is made up of senior leaders from both the insurance and personal finance profession who are joining forces to improve women’s resilience to risk, as part of the Insuring Women’s Futures programme.

The Insuring Women’s Futures Market Task Force will take steps to address some of the root causes of the 12 financial ‘Perils and Pitfalls’ that impact women’s financial resilience through life and culminate in an enduring women’s pension deficit, for example: young women’s financial capability; the motherhood penalty and part-time working; and improving how the insurance and personal finance profession serves women in their Moments that Matter.

Women risk financial insecurity in later life due to a culmination of societal, health and financial factors stacked against them, according to a report from Insuring Women’s Futures.

Women today are living longer, are better educated and have greater access to career opportunities, but with earnings forming the basis for pension saving, the gender pay gap is a major contributor to women’s pension deficit.

The average pension wealth of women aged 65 is £35,800 – just 1/5th of that of men the same age, and a mere fraction of what will be their financial needs in retirement even before their possible end of life care costs are taken into consideration – on average those will be £132,000 for a 65 year-old woman entering a care home in the UK.

The report says that the main reason why women have smaller pensions is because of the way society views women and women’s roles in the workplace and daily life.

Longstanding laws and policies also penalise women.

These include:

The gender pay gap/women’s earning potential: Men earn 80 per cent more than women over their lifetime.

Lower pension contributions: A woman pays £80 a month into a pension ‘pot’ type of pension, on average. It’s £149 a month for a man.

Lower employer pension contributions: Men aged under 35 receive £217 a year more by way of employer contributions towards their pension than women do.

Caring responsibilities: One in seven women in their 40s are caring for a child and a parent. A third of women in their 50s are caring for an elderly relative.

Divorce: A divorced man has £30,000 in his pension, on average, compared to £12,000 for a divorced woman.

Part-time work: Over three quarters of the employees who can’t be automatically enrolled into a workplace pension because they earn less than £10,000 (from each job) are women. Women make up 81 per cent of those who work part time. Women who work part time are paid 30 per cent less an hour on average, than women who work full time.

The state pension: More men get paid the full state pension. The report shows that men get £29,000 more from their state pension than women over their retirement.

The state pension age rise: The state pension age for women has risen from 60 to 65 (it will be 65 in November) and then rises to 66 by October 2020; and it is having an incredibly detrimental effect on finances of millions of women.

Low paid women miss out on tax relief on workplace pensions: Most workplace pension schemes take your pension contributions from your salary before they take tax. Under the pension rules, even people who don’t pay tax can get tax relief at 20 per cent on up to £2,880 of pension contributions a year. But they miss out on this if their employer uses this so-called ‘net pay arrangement’.

Sian Fisher, CEO of the Chartered Insurance Institute, and chair of the Insuring Women’s Futures committee, said: “Women’s lives and freedoms have changed for the better, yet society’s expectations of women have not.

“The serious financial disadvantage women face in old age cannot be attributed to any one factor but is a combination of societal, health and financial factors stacked against them.

“Women are living longer, however, care costs them more at the end of their lives.

“Women are succeeding in the workplace and the gender pay gap is hopefully closing but caring for family, even for just a few short years, significantly impacts a woman at retirement.

“It is the culmination of all these factors that is potentially driving women towards to poverty in old age.

“By 2020, 12 million people will be above the State Pension Age and, of these, there will be a million more women than men.

“Insurance and financial planning have a central role in supporting people to manage their financial risks in life.

“The findings in this report show there is much to be done to improve women’s pensions and financial resilience generally.

“In conjunction with our Market Task Force Manifesto, Insuring Women’s Futures calls upon government policymakers, regulators, the legal, insurance and personal finance and wider financial services profession to unite with society to realise positive change to create a sustainable retirement for all.”

To download the report, click here.

Find out more about Insuring Women’s Futures, and how you can get involved in making a difference to this initiative.

Have your say via Twitter, and use the hashtag #momentsthatmatter

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