New research has found that average women in their twenties today will have £100,000 less in their pensions than their male peers upon retiring.

The report was produced by pensions firm Scottish Widows to coincide with International Women’s Day, which found that women in the first 15 years of their careers on average save about £2,200 a year, compared to £3,300 for their male counterparts.

Lower average earnings, part-time work and the need to take time out of employment to care for family all cut into savings and are setting women back by almost four decades compared to men, the firm stated. The average young woman today will need to work 37 years longer than a man to reach “retirement parity”.

The COVID-19 pandemic has further widened the gender pension gap, the firm continued. 36% of employed women under the age of 25 work in areas such as hospitality and retail, which have been among the sectors hardest hit by the health crisis, and over 49% have been furloughed.

"We know that young women have been some of the hardest hit by the short-term financial impact of the pandemic and this has only exacerbated the challenge of reaching pensions parity,” said Jackie Leiper, Scottish Widows’ managing director of pensions.

However, the firm found that if women could increase their pensions contribution by 5% from the beginning of their careers, they could almost completely close the gap by the time they retire.

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“By taking control of their contributions and increasing them as early as possible, young women stand a fighting chance of improving their long-term savings outlook,” Leiper said.

A spokesperson for the Department for Work and Pensions drew attention to the government’s pension reforms and increased pension participation among women in the private sector, which rose from 40% in 2012 to 86% in 2019.