The gender pension gap has increased to £113,000 Find out how to make up the difference and increase your pension

According to Scottish Widows, the gender pension gap is widening, with one-third of women experiencing poverty in retirement

One in three women experience pension poverty as a result of career breaks, and there is a gender pension gap of 113,000.

This is the conclusion of Scottish Widows' 21st edition of its yearly Women and Retirement Report, which examines pensions and the challenges that women generally face when building a respectable retirement fund.

The insurer stated last year that there was a 100,000 gender pension gap and threatened to take 20 years to close it unless "decisive action was taken."

Sadly, it has now expanded to 113,000. According to Scottish Widows, the median total private pension savings for women at retirement is 173,000, compared to 286,000 for men. This results in a 32% gender pension disparity.

The gender pension gap affects millions of women in the UK without them even realizing it, according to Susan Hope, a retirement specialist at Scottish Widows. The "

The gender gap in the state pension has decreased to less than 1%, which is good news for women even though the private pension gap has widened. When it comes to today's retirees' state pensions, the gender pension gap has virtually disappeared, according to data released in August by the Department for Work and Pensions.

Why is the gender gap in private pensions so significant?

The gender pension gap is caused by a number of factors, one of which is the substantial influence of career breaks on pension saving.

According to the Scottish Widows report, 58% of women who are at or near retirement have taken a career break, compared to 12% of men.

Women are 12 times more likely than men to take a career break to raise children (36 percent versus 3 percent), which results in income loss and pension contribution gaps.

One in four women (24%) have been unemployed for more than five years by the time they are 55, which could cost them £70,000 when they retire.

For instance, a woman who takes a five-year career break at age 35 would receive a pension of £512,000 when she is 67 years old. This is 69,380 less than those who don't take a career break; the difference is caused by both lost investment growth and missed contributions.

Career breaks are primarily caused by childcare, but other factors include health, menopause, and caring for aging family members.

Additionally, two-fifths (40%) of women did not budget for their career break, and more than half (56%) never thought about how it would affect their retirement.

Scottish Widows warns that over one-third (36%) of women will experience poverty in retirement due to these career breaks and the growing gender pension gap.

Women are expected to earn a median annual retirement income after anticipated housing costs that is 32% less than men's (13,000 versus 19,000) in terms of the annual pension income shortfall.

A financial plan that provides security during career breaks and "when your income is more up and down" is crucial, according to Dame Denise Lewis, a former Team GB track and field athlete who is working with Scottish Widows on the report's launch.

"Crucially, it's not just a challenge at the moment, it also has a real impact on our futures," she continues. The more we can motivate women to initiate those crucial talks at the kitchen table about their future and how they will pay for it, the better. The "

How to increase your pension and close the gender gap.

"Make sure career breaks don't break womens future financial security," according to Scottish Widows.

According to Hope, the first step is to increase awareness of and adherence to shared parental leave policies. Despite the importance of this policy, 80% of women who had children within the previous ten years did not utilize it. This equates to approximately 2.7 million mothers who work. A "

Second, if at all possible, spouses and partners should actively contribute to women's pensions during any career pauses. This is also referred to as third-party contributions, and although it is frequently disregarded, it is a useful tool for financial planning. In addition to maximizing tax relief for individuals who have depleted their allowance, this can help close pension contribution gaps while earning power is constrained, says Hope.

More information about this can be found in our guide: Is it possible to contribute to someone else's pension and if so, how much?

You can increase your pension and make sure you're on track to reach your retirement objectives in other ways. This can include utilizing salary sacrifice to maximize your pension and lower your tax liability, as well as the 1 percent pension rule, which allows you to contribute an additional 1 percent to your workplace pension and benefit greatly from compound interest by the time you retire.

It's also important to make sure you're not overspending on investment and pension fees. Combining several small pension pots can be a good way to cut down on administrative work and possibly save money overall.

Lewiss's advice to discuss pensions with loved ones is echoed by Samantha Gould at now: pensions, a workplace pension provider.

"If we consider the gender pension gap, women would need to start saving at age three in order to catch up.

"Because awareness must precede action, we must work together to bring attention to the gender pension gap. Too often, people shy away from discussing pensions because they seem unclear or too far off, but the earlier you start saving, the longer your money has to increase. The "