Gender pensions gap starts at age 28 – how women can boost their pension

Women’s pensions are only around a half to two thirds that of men’s on average. New research has suggested the trigger point – pension contributions start taking a different path at age 28 on average, just as couples begin starting a family.

Adult women hold 48% less in their pension than men on average, according to HMRC figures. AJ Bell looked at contributions by self-invested personal pension (Sipp) investors on its platform and found a trend that may explain why.

Sipp value between men and women starts to diverge at the age of 28, with men’s pension value soaring from that point as women’s stays lower, and never catches up.

Try 6 free issues of MoneyWeek today

Get unparalleled financial insight, analysis and expert opinion you can profit from.

Start your trial

Sign up for MoneyWeek’s free twice-daily newsletter.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Sign up

What causes the gender pension gap?

Twenty eight is a key age. Many women will be starting to think about getting married or starting a family. Most recent data from the Office for National Statistics pointed to the average woman in the UK having her first child at 29, which is both a huge life event and a financial shift. It is also the same time graduates might also be eyeing a growing student debt balance.

“More women start to work part time or take career breaks at this age too, as children come into the picture, and the pension system can leave them behind,” said Charlene Young, senior pensions and savings expert at AJ Bell.

“What’s more, the financial pressures of having kids mean that many women might even stop contributing to their pension altogether during longer periods of maternity leave. Less money rolling into pensions means investment growth needs to do some seriously heavy lifting to bridge the gap,” she added.

How missed or lower pension contributions fuel the gender pensions gap

While auto-enrolment means more workers saving for retirement, and from a younger age, many people are either not saving enough, or in some cases, not saving into a pension at all. When women take career breaks, as many do when they have children, they miss out on automatic contributions, widening the pension gap.

Even as women begin to return to work, many choose part-time work or self-employment. For women between the ages of 29 and 40, 21% said they were working part time, in comparison to just 5% of men, according to the AJ Bell research.

“Competing priorities mean many women actively choose not to boost pension contributions. It’s a crucial time in their lives as younger women could miss out on the power of investment growth over a longer timeframe,” said Young.

We look at ways the so-called sandwich generation can protect their wealth while caught between caring responsibilities in a separate article.

Contributing to a pension from age 40

However as women hit age 41, they begin to prioritise their pension equally to men, the AJ Bell research found. Almost one in three (29%) women aged 41 to 55 name their pension as a financial priority, compared with 30% of men.

And at age 41, if £100 is added to a pension a month that equates to an extra pot worth £42,500 after 20 years. That increases to over £66,700 if the payments continue until age 67 (the current state pension age), by AJ Bell’s calculations, assuming your pension pot grows by 6% each year and includes annual charges of 0.6% and all dealing charges.

Average woman’s income from private pensions

The average income from private pensions for women, before tax, was £11,500 in the 2024/25 tax year. This is compared with £17,200 for men, analysis of HMRC data from a Freedom of Information request by Bowmore Financial Planning showed.

The gender pension gap between men and women’s pensions has widened over the last few years, the data showed – currently women have a private pension of just 67% that of a man’s, when back in 2020/21, women’s private pension income stood at 71% of men’s.

The gender pension gap widens the closer women and men get to retirement age, reaching a whopping 48%, according to data from the Department for Work and Pensions (DWP).

The latest figures, published in July 2025, were released alongside research which said people retiring in 2050 are on track to be poorer than pensioners today.

Women could be at particular risk. The average woman aged 55-59 has built up a private pension worth £81,000 compared to £156,000 for the average man, according to the DWP figures.

Applying an annuity rate of around 7% at age 60 would convert these pension pots into an annual income of around £6,000 for women and £11,000 for men. It means women are left with £5,000 less each year.

These figures don’t include those who haven’t built up any private pension wealth at all. The gap rises to 62% when they are factored in.

“The government’s latest research paints a bleak picture for women approaching retirement,” said Rachel Vahey, head of public policy at AJ Bell.

“Although automatic enrolment has done its bit in creating more female pension savers, boosting the number of women who pay into a pension, the analysis clearly shows that the wheels come off women’s retirement savings when they start a family.

“The gap is much smaller at younger ages, at 22% for those aged between 25 and 29, but rises dramatically for older women.”

High-earning women miss out

High-earning women, in particular, should take advantage of paying into a pension to lower their tax bill as well as boost their retirement savings and access other benefits, said Gill Millen, managing director at Bowmore Financial Planning.

Pension contributions can, for example, be used to reduce earnings and fly under the 40% higher income tax rate (or the 60% tax trap that affects those earning over £100,000).

Paying into a pension can also be used as a general planning strategy, enabling people to claim back lost Child Benefit or free childcare where income exceeds £60,000 or £100,000 respectively.

There may also be the option for women to start claiming Child Benefit during maternity leave.

Millen said: “Many high-earning women do not claim Child Benefit because they mistakenly assume they would not be entitled to any benefits. In reality, a claim can help them secure a better state pension, even if their income means they do not receive a payment at the time they apply.”

People need at least 35 ‘qualifying' years of National Insurance contributions (NICs) to receive the full state pension upon retirement, with payments pro-rated for those with fewer years. Claiming Child Benefit helps women avoid gaps in their National Insurance record during maternity leave through NI ‘credits’.

Millen said: “High-earning women who skip Child Benefit risk having a lower state pension in retirement, and for no good reason.”

Making use of salary sacrifice (also known as salary exchange) on pension contributions into a workplace pension plan is another way of maximising contributions, with the added National Insurance savings either helping to increase net take home pay or further boosting pension savings.

“However, salary sacrifice is likely to be heavily restricted in 2029 so you will need to take full advantage of salary sacrifice over the next three years,” Millen said.

Gender pay gap

The gender pay gap is a key reason for the gender pension gap – and the average woman effectively works for 47 days of the year for free due to the gender pay gap, according to analysis released in February. This is because the gap in pay between men and women is the equivalent of around a month and a half’s average salary that women lose out on.

The gender pay gap currently stands at 12.8%, meaning the average woman worker gets the equivalent of £2,548 a year less than the average man worker, the research from the TUC union showed. The gender pay gap is widest for middle-aged and older women, in their peak pension saving years.

At current rates of progress, it will take 30 years – until 2056 – to close the gender pay gap. It is closely linked to the gender pension gap, which refers to the difference in how much men and women have in their pensions. Men have tens of thousands of pounds more in pensions on average.

A number of factors are driving the pay gap, the TUC said, including some women working part-time to take on extended caring responsibilities throughout their lives, therefore taking a significant pay cut.

The government, which has an ambition to close the pay gap, needs to create more opportunities for men and women to share care, improve access to flexible working and create better access to childcare, the TUC said.

Paul Nowak, TUC General Secretary, said: “Women have effectively been working for free for the first month and a half of the year compared to men.

“With the cost of living still biting hard, women simply can’t afford to keep losing out. They deserve their fair share.

“The Employment Rights Act is an important step forward for pay parity for women. It will ban exploitative zero hours contracts, which disproportionately hit women and their pay packets.

“And it will make employers publish action plans for tackling their gender gaps – but these plans must be tough, ambitious and built to deliver real change – otherwise they won’t work.”

Pay gap across industries

The pay gap persists across different industries, and even in jobs dominated by female workers, such as education and care.

In healthcare and social work, the earning gap is 12.8%, meaning the average woman effectively works for free for 47 days.

In education the earning gap is 17%, making women’s ‘free work’ period 62 days. In wholesale and retail the earning gap is 10.5%, with 38 ‘free work’ days.

The largest gap is in finance and insurance. The gender pay gap (27.2%) is the equivalent of 99 days, meaning women effectively work for free until 9 April 2026.

Gender pay gap and pension gap by age

The gender pay gap affects women throughout their careers, from their first step on the ladder until they take retirement, the TUC analysis found. But the gender pay gap is widest for middle-aged and older women.

Women aged between 50 and 59 have the highest pay gap of 19.7%. Women aged 60 and over have a gender pay gap of 17.7%. By comparison women aged 40 to 49 have a gender pay gap of 16.2%.

The gender pay gap widens as women get older due to women being more likely than men to take on unpaid caring responsibilities throughout their lives, limited childcare and social care provision, and too few good quality flexible jobs, the TUC said.

^{Source: DWP estimates based on the wealth and assets survey from the Office for National Statistics (ONS). Percentages may not correlate directly with pension pot amounts due to rounding.}

The gender pension gap is widening

In 2023, the government calculated a smaller gap of 35% among those aged 55-59. By 2025 this had risen to 48%.

“The widening appears to be related to the move from defined benefit to defined contribution pension provision, which appears to be disproportionately affecting women's retirement outcomes more than men’s,” said Kate Smith, head of pensions at Aegon.

Defined benefit (DB) schemes were more common in the past, but are still widely used in the public sector. They are typically more generous than defined contribution (DC) schemes.

DB schemes pay out a guaranteed income in retirement, usually based on your salary and length of service. Meanwhile, the size of a DC pot depends on how much you contributed while working and how your investments have performed.

The gender pension gap rises to 75% among those who only have DC pots. It falls to 39% among those who only have DB pots.

“Considering that DC pensions are the future for most, it's deeply concerning that the biggest gender pension gap is for women aged 55-59 who only have DC savings wealth,” Smith said.

“Unless there are radical interventions to close the gender pay gap, address labour market inequalities and societal norms, this doesn't bode well for the future of women's pension equality.”

Five ways women can boost their pension

While the onus is on policymakers and employers to create a fairer environment for women saving for retirement, there are also some steps you can take to boost your own financial resilience.

1. Start building your pension at a young age

Building wealth is less about timing the market than time in the market. Start building your pension as early as possible, even if retirement feels a long way off.

Under auto-enrolment rules, UK employers are legally obliged to provide an employee pension scheme and, as soon as you start working, you will be automatically enrolled (provided you are 22 or older, and earn at least £10,000).

You will automatically start contributing 5% of your salary, and your employer is obliged to contribute a minimum of 3%. You are free to opt out or to reduce your 5% contribution, but it is almost always a bad idea.

Opting out when you are young means you will have less in your pot when you reach retirement. It is not just your contribution that you lose, but also the opportunity for valuable investment returns. These can snowball over time due to compounding.

Opting out could also mean you lose your employer contribution, which is essentially ‘free’ money.

2. Increase your pension contributions

As well as maintaining your 5% pension contribution, you should consider upping your contributions, if you can.

Investing consistently over a long time horizon is the best way to build wealth. While it might be tempting to stash the cash in your bank account where you can easily access it, investment returns almost always beat cash over the long run, even when interest rates are high.

Even a small increase could have a significant long-term impact, as illustrated by figures we plugged into Scottish Widows’ pension calculator.

The calculator shows that a 25-year-old earning £30,000 could boost their pension by almost £40,000 by the time they turn 60, if they increase their annual pension contributions by 2% above the standard auto-enrolment level.

These calculations assume medium investment growth of 5% per annum, annual investment fees of 0.75%, and annual wage growth of 3.5%.

Scottish Widows recommends boosting your contributions by even more than this, if you can. The pension expert says 12-15% (rather than the standard 8%) could help you achieve a comfortable retirement. This includes your personal contributions, your employer’s contributions and tax relief.

3. Find out if your employer will match your pension contributions

If you pay more into your pension, some employers will match your contribution, up to a certain limit. Take hold of this opportunity if you have the chance. It is essentially free money and can help you narrow the pension gap.

4. Pay into your pension while on maternity leave, if you can

When you go on maternity leave, your employer will usually continue to make contributions to your pension based on your salary before you went on leave. This continues for at least 39 weeks, if you are entitled to statutory maternity pay.

Your personal contributions will be based on your maternity pay, though, which is likely to be less than your full salary. If you are in a position to top these up so they match what you were paying in before, it could be worth considering.

5. Can your partner top up your pension contributions?

If you take time out of work to carry out caregiving responsibilities, such as looking after young children, speak to your partner to find out whether they can contribute to your pension during this time.

It could be worth having this conversation before deciding to have children to ensure you are on the same page when it comes to your finances.

Research from Moneyfarm revealed that 42% of men would not be prepared to pay into their partner’s pension while on maternity leave, with 27% saying the woman’s pension is her own responsibility.

“These figures highlight a significant gap in financial support and shared responsibility within households,” said Carina Chambers, pensions technical expert at Moneyfarm.

“Encouraging open conversations about financial planning and the importance of supporting each other's long-term financial goals is a step towards achieving true gender equality. By working together, we can ensure that all women have the financial security they deserve, both during maternity leave and beyond.”

It is also worth remembering that a pension is a tax-efficient way to save and invest for retirement. As such, topping up a spouse’s pension is a good way to shield your collective wealth from the taxman.