Happy International Women’s Day – a historic day, celebrated globally and dedicated to recognising and appreciating the achievements of women. And today I’ll be contributing by joining in the conversation around women in pensions.
When I Googled the phrase ‘women in pensions’, it quickly became clear to me that there’s an equality problem, as I was served with numerous headlines of how women are losing out when it comes to their retirement savings.
As a young woman with zero pensions experience before joining like minds, it came as a huge surprise to me. Suddenly, there was a shift in how I viewed my own pension, and I wanted to find out what the underlying causes of the inequality were – I discovered that one such cause is the gender savings gap.
The gender savings gap has been a topic that’s gained momentum in the pensions industry over the past few years, as statistically women will have less in their retirement savings than men. Although the number of women in senior positions has increased, they’re still faced with the gender pay gap issue and penalised for taking childcare leave, all of which impacts their final retirement savings.
There’s been a lot of research on this; from statistics showing the differences in gender savings, to advice on how women can be proactively reducing this difference. For example, in 2021 Scottish Widows found that women in their 20s today are en route to retire with £100,000 less in their pension pot than a man the same age – which, as a woman, I find absolutely mind-boggling.
All of the research, all of these articles, all come back to one overarching solution: women need to be more proactive with their savings. Women need to do this to save more, women need to do that to save more.
And yes, women should be taking proactive measures to secure a retirement that they deserve, but it’s hard to ignore the possibility that there’s more the pensions industry could be doing to engage women.
So, are pensions communications failing to engage women? Let’s find out.
Our findings
As part of our No Member Left Behind ™ research, we surveyed 4,010 people saving into their workplace pension scheme to find out how they really feel about their pension and the communications they receive.
Within that research, we found that there are significant disparities when it comes to how women engage with the pension communications they receive compared with their male counterparts.
The breakdown
When we asked how members read the communications from their pension providers, only 1 in 4 women read the entire piece, and paid attention to all the details. This compared to 1 in 3 men.
On average, only 42% of women read every communication, such as emails and letters, received by pension providers. This compared to an average statistic of 46% of men reading every pension communication.
We found that 50% of women didn’t engage with their pension provider at all in terms of contacting them, watching their videos, visiting their website and so on. This compared to 38% of men.
Only 32% of women felt ‘quite informed’ around their investments, compared to 41% of men.
And only 52% of women thought their pension providers spoke to them in a human way, a tone that is understandable and relatable. This compared to 61% of men.
Although some of the statistics between men and women aren’t too far apart in number, there is one visible pattern; women mostly scored lower in engagement levels – this didn’t surprise me when comparing it to other research. For instance, it supports the Financial Conduct Authority’s recent survey, which also found that women are less likely to be engaged with their pensions.
Being engaged with pension communications is an important part of making informed decisions when it comes to money and savings, and if women aren’t engaging as much, then there’s the possibility they could be losing out on more in retirement.
But, our research also shows that 39% of women ‘care a lot’ about how their money is invested by their pension provider, compared to 37% of men. This goes against the traditional belief that women aren’t interested in investments and suggests there’s an appetite for learning about them.
So, what can we do?
Generally, I’ve noticed there’s an assumption made in finance communications that positions men as savers and women as spenders, which may subconsciously relay back into pensions communications. This gendered bias could lead to pensions being tailored more towards men, in terms of how they’re designed and communicated.
Although engagement levels across both men and women weren’t exceedingly high in our results, extra work is still needed on behalf of the pension industry to work actively to engage more women across the board.
Communicating information is easy, but making that communication easily accessible, and easy to understand for a wide range of people can be the hard part. It starts with making a conscious effort to really think about who you’re talking to. When we start to consider things like tone of voice, the language we use, how appealing the communication looks, and what mode of communication to use, we become more inclusive of our audience. For example, some of the figures showed women voting higher on making the communications short and reducing the number of complex terms used. So, pensions industry, on behalf of all women, enough with the jargon!
Engagement levels can only be increased, when we become more aware of diversity and inclusion and make changes to the way we communicate.
So, it’s time to…
Change the narrative, communicate in plain English and consider the best format to deliver pension messages.
Learn who the members of a pension scheme are, through surveys and data, to tailor the communication to their individual needs. Be truly mindful of the audience when creating communications and carefully selecting the words and platforms used – it can have a major impact on the way people respond to what’s being communicated.
Although this won’t end the problems when it comes to equality in pensions, effective engagement can go a long way in providing members with the confidence to take control of their pension. And effective, engaging communications can help women, like me, to become more proactive with their savings.
If you’d like to find out more about No Member Left Behind ™, then you can find out more here and sign up for our next event.
P.S. If you missed the last online event, that’s no worries, you can watch it all here.
