Women endure gender pay gap into retirement

The gender pay divide that women experience at work continues into retirement, with the average retired woman’s income 40% that of the average retired man’s.

The annual State of retirement report from the financial services provider LV (formerly Liverpool Victoria) shows that the average income for older people drops by around two-thirds on retirement.

According to survey findings, 30% of women over 50 expect to have to work longer than previously anticipated, compared to 23% of men in this age group. While some are choosing to delay retirement simply because they would prefer to remain active in the workforce, many are making this choice for financial reasons.

The report shows that while the average annual salary for the over-60s is £25,480, the average annual pension income is about a third of that at £8,774 — around 24% less than the minimum wage. The average figure for women is considerably lower, at £6,580.

The report indicates that the average drop in income for women on retirement is 68%, compared to 60% for men. The drop will be even bigger for those with no pension savings. According to the LV survey, 19% of women and 12% of men within five years of retirement have no pension savings at all.

They face reliance on a state pension, currently worth £110.15 a week, when they stop working.

www.lv.com/adviser/working-with-lv/news_detail/?articleid=3226221