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Flexible pensions suggestion for women

Flexible pensions suggestion for women

Category: Pensions

Updated: 16/10/2009
First Published: 16/10/2009

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The Government has been urged to introduce better pension incentives to encourage women to save, after it was revealed they still fall far short of men when it comes to retirement planning.

According to research from Scottish Widows, just 47% of women who should be saving for retirement are saving adequately, compared with 59% of men.

As a result, the insurer has called on the Government to consider a number of proposals that it believes might help incentivise women to save more.

With one in five women claiming they would be more inclined to save for the long term if they could access part of their pension savings before retirement, one suggestion involves the development of so called feeder funds, enabling the individual to build up a flexible savings pot first, before payments spill over into the pension fund.

In a similar vein, providing easier access to funds before retirement has also been mooted as a potential idea. With pension funds at present unable to be accessed before the age of 50, and rising to 55 in 2010, the concept of pensions "lock away" has been cited as a major obstacle to saving, particularly by women and those on low incomes.

Steps to address a lack of awareness amongst women of pension needs and the upcoming implementation of personal accounts have also been suggested.

Ian Naismith, head of pensions market development at Scottish Widows, said that difficulties for women trying to save for retirement often arise because many take time out of working life to have a family, and also put their families' needs over and above their own.

"While the Government has introduced measures in recent years such as allowing people to purchase missing National Insurance contributions to help those with broken work histories, there is still more that can be done to narrow the gender pensions gap further by encouraging savings.

"When it comes to pensions savings, there really isn't a one size fits all approach and if more is done by both the Government and the industry, we can help ensure that women can enjoy a comfortable retirement."

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