Single parents average almost £250,000 less in assets than co-parents, reports reveals
A new report has shown the demographics of those who are most concerned about retirement and pension plans, with single mothers most concerned about money after retirement.
The Scottish Widows Women and Retirement Report 2022 found that 72% of single mothers are concerned about not having enough money in retirement, as opposed to 61% of women generally, and 52% of men. The report involved surveying more than 5,000 people and Office for National Statistics (ONS) figures.
It was also revealed that 40% of single mothers are not a member of a pension, compared with 29% of women in general.
The report showed the disparity between couples with dependent children and single parents assets, with couples averaging £275,000 in assets whilst single parents only had £29,000 in assets, including pensions.
Jackie Leiper, managing director of workplace savings, Scottish Widows, said:
“Current economic conditions are making it harder than ever to fix the deep inequalities that underlie the pensions gap, with the retirement savings of women deeply impacted by key life events such as divorce or motherhood.
Providers, regulators and employers must collaborate urgently to address this crisis – from reconsidering the auto-enrolment threshold to far greater investment in childcare support – to help the most vulnerable in the near-term.”
Phil Brown, director of policy at B&CE, provider of the People’s Pension, said:
“The gender pensions gap isn’t going to close itself and is likely to widen, unless policymakers make it easier for women, especially mothers, to return to the workplace. This will only happen if there is better access to affordable, good quality childcare, as well as automatic enrolment reform.”
A Department for Work and Pensions spokesperson said:
“Automatic enrolment (AE) has helped more women save into a pension, with participation rates for women catching up with those for men. In 2021, 87% of eligible women working in the private sector were participating in a workplace pension, up from 40% in 2012.
AE was designed specifically to help women and other groups such as young people, and lower earners, who historically have been poorly or less well served by the pensions market.
The Government’s ambition for the future of automatic enrolment is to abolish the lower earnings limit and reduce the age for being automatically enrolled to 18, which will improve financial resilience in later life for women and these groups.”