Pension warning for women

Young women are cutting their pension contributions to cover the cost of childcare, risking poverty when they retire, a new report has warned.

The Fawcett Society said women in their twenties and thirties were often relying on their partner for a secure retirement.

Many were taking full responsibility for childcare costs, or were taking a break from work to look after children, a study found.

Student debt and childcare costs were preventing women from saving, according to research by the women’s equality charity and Sheffield University, supported by Scottish Widows.

Sam Smethers, chief executive of the Fawcett Society, said: “The gender pay gap becomes a pensions gap in retirement. In particular, women are taking a big hit on their pensions when they have children, but are not aware of the impact this will have on them in the long-term.

“Women are putting everyone else’s needs before their own, especially when it comes to who pays for childcare. Their baby becomes her childcare bill.”

Jackie Leiper, retirement expert at Scottish Widows, said: “The findings of the report echo those of our own, showing a clear shortfall developing when it comes to retirement savings between men and women in their thirties.

“Despite similar levels of engagement between men and women in their twenties, this begins to drop at an alarming rate over the following decade.”