56% of women feel unprepared for retirement, with almost the same proportion of women feeling somewhat unprepared (37%), as somewhat prepared (36%), according to new research by Canada Life.
However, 53% of men feel prepared for their retirement, with a further 12% feeling completely prepared compared to 7% of women.
Canada Life said that smaller pension pots and earnings inequality have long been the reasons given for why women have less retirement income than men. Yet the research suggests another important factor is at play – women’s readiness to release equity from their property. 36% of women say that they are likely to use the equity accumulated in their property in the future, compared to 46% of men. This is despite the majority of women acknowledging their pension is worth a lot less than their property, an increase of seven percentage points from 2016.
The findings follow earlier research from Canada Life’s Retirement Sentiment Index, which revealed that women believe they need £1,421 a month after tax to live comfortably in retirement. On average, single female pensioners received £206 per week in 2017-18, suggesting they will fall short by £500 a month.
Alice Watson, head of marketing and communications at Canada Life Home Finance, said: “Unfortunately, it’s not particularly surprising that many women are feeling underprepared for retirement. We know that women typically have less in their pension pots, due to a variety of socioeconomic reasons. And our research earlier this year revealed a big gap between what women believe they need in retirement and what they will likely receive.
“Lifetime mortgages can offer women the flexibility and security they need to give them peace of mind in retirement. The industry needs to be confident that everything is being done to raise awareness of the benefits of unlocking the wealth stored in their homes, particularly among women, and that tailored financial advice is readily available.
“We know how important it is for advisers to be able to make their clients aware of all the options available to them to boost their retirement income, which is why we have recently launched another round of ‘Setting the Standards’ workshops, to help qualified advisers give the best possible advice.”