Gender gap of annual expected retirement income widens by £1,000 over last year

Women retiring in 2017 can expect an average annual retirement income of £14,300, which is the second highest on record but down on the £14,500 for those retiring in 2016

According to the Fawcett Society, the current overall gender pay gap for full-time workers is just below 14 per cent

The gap between women’s and men’s annual average expected retirement income has grown by £1,000 in the past year, according to new research. A report shows that women who are set to retire this year will be £6,400 a year worse off on average than their male counterparts and nearly £200 a year worse off than women who retired in 2016.

Women retiring in 2017 can expect an average annual retirement income of £14,300, which is the second highest on record but down on the £14,500 for those retiring in 2016, according to the report published by Prudential.

Men’s average retirement income, meanwhile, has shown a fifth consecutive year of growth. They can expect an annual retirement income of £20,700 – which is up £900 on last year’s figure. As a result, the gender pay gap is now at its highest level since 2014, when it stood at £6,700.

Kirsty Anderson, a retirement income expert at Prudential, said that in many cases the divide reflects the fact that women take more career breaks and more frequently change their working patterns to look after dependants. Nationally, women still earn significantly less than men over their careers also because of clustering in low-skilled and low-paid work and, in some cases, discrimination.

According to the Fawcett Society, the current overall gender pay gap for full-time workers is just below 14 per cent.

“For anyone who takes a career break, maintaining pension contributions and, where possible, making voluntary National Insurance contributions after returning to work, should help to minimise the impact on their retirement income,” Ms Anderson said.

Prudential conducts the same study every year. Findings are based on an online survey of 10,605 non-retired UK adults aged 45 or older, 1,000 of which said that they plan to retire in 2017.

The gender pay gap was at its widest in 2008 when the average expected retirement income for men was 84 per cent higher than that expected by women, putting the gap at £9,500.