A recent Prudential survey says that women retiring this year will be living on an average pension of £234 a week, which falls two-thirds short of that of their male counterparts.
This figure has dropped by 11% on that produced by the same survey last year, whilst the figure for men has only dropped by 3%.
The reason put forward is that many women did not contribute to a pension fund during the years in which they stayed off work to raise children and also because at present, the compulsory retirement age for women is 60 meaning they have five years less than men to accumulate a pension pot.
Prudential’s advice to women was to ‘try to keep paying private pension contributions and National Insurance for their state pension during career breaks while they bring up children’.
Geoff Charles, Managing Director of Bower, says that this news could spell difficulties for women who lose their husbands and find themselves without the benefit of their partner’s income to live on. He suggests that those who own property could use it to help top up or supplement their income and says: ‘Property owners could use an income release or drawdown facility via a lifetime mortgage to boost their finances in retirement.’
Equity release may involve a lifetime mortgage or home reversion plan. To understand the features and risks, please ask for a personalised illustration.
Bower is an FCA regulated independent financial advice company that offers specialist advice on equity release throughout the south of England. For more information e-mail [email protected] or call [tel]. Bower offers a no obligation initial consultation to homeowners considering Equity Release.