New research from the Pensions and Lifetime Savings Association (PLSA) reveals that millennial (18-35 year old) women feel more financially anxious than their male peers. This is particularly concerning as they have the smallest gender pay gap (5%*) of any age group and therefore should arguably be at their most financially confident.
Key financial indicators:
Research of 1,001 millennials revealed that women were less financially confident than millennial men across a series of key financial indicators. They were less optimistic about career advancement (55% of women versus 61% of men) and almost twice as likely to report a decrease in their salary over the last six months (14% of women versus 8% of men).
In addition, they were more likely to report increasing bills over the last six months (41% of women and 33% of men) and almost three times as likely to say they had borrowed more over the past six months (33% vs. 12% of men). Women were more likely to feel that the pressure to save for the future had increased in the last six months (51% of women and 36% of men) although they were less optimistic about purchasing a home (26% vs. 35%) which is often a significant savings goal.
Worse off than their parents:
Similar proportions of millennials of both genders felt that they were less able to save than their parents (men – 57% and women – 58%) and that the basic cost of living is higher (men – 85% and women – 88%). However, more women (37%) than men (30%) felt that they had worse ‘life opportunities’ than their parents’ generation which suggests that while the gender pay gap may have improved, they still perceive barriers to achieving their ambitions.
Confidence and knowledge:
Additional Pan-European research** released earlier in the year also suggests that women are generally less confident in their financial knowledge so less inclined to take calculated risks. However, the same research shows that the actual gender financial knowledge gap is smallest among millennials suggesting their lack of financial confidence may well be unfounded.
Graham Vidler, Director of External Affairs, Pensions and Lifetime Savings Association, said:
“Typically, women have had smaller pensions than their male counterparts but with the advent of automatic enrolment, more women are being encouraged to save than ever before. It is therefore vital that the lack of financial confidence amongst millennials does not discourage them from taking advantage of workplace pensions and falling behind when saving for retirement.
“Early in a woman’s career, when the gender pay gap is at its lowest is arguably the ideal time to get into the savings habit and start thinking about retirement income. Over half of millennial women feel pressure to save for the future and using an occupational pension scheme offers a variety of advantages. Not only will they benefit from employer contributions and tax relief but also gain peace of mind for the fact that they are taking proactive steps to building a better standard of living in retirement.
“Employers need to ensure that they are engaging with this age group and helping millennials to feel more confidence about their retirement choices.”
NOTES TO EDITORS:
ComRes interviewed 1,001 British adults aged between 18-35 online between 9th and 20th February 2017. Data were weighted by region to be representative of all British adults aged 18-35; by gender, age and socio-economic grade. ComRes is a member of the British Polling Council and abides by its rules. This commits us to the highest standards of transparency.
All data as outline above except for
* = Resolution Foundation – January 2017 - Gender pay gap falls to 5 per cent for Millennials in their 20s – but they are still set to face a huge lifetime earnings penalty
** = Allianz – – January 2017
ABOUT THE PENSIONS AND LIFETIME SAVINGS ASSOCIATION
We’re the Pensions and Lifetime Savings Association; the national association with a ninety year history of helping pension professionals run better pension schemes. Our members include over 1,300 pension schemes with 20 million members and £1 trillion in assets, and over 400 businesses. They make us the voice for pensions and lifetime savings in Westminster, Whitehall and Brussels.
Our purpose is simple: to help everyone to achieve a better income in retirement. We work to get more money into retirement savings, to get more value out of those savings and to build the confidence and understanding of savers.
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Kathryn Mortimer, Press Officer, Pensions and Lifetime Savings Association
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