Mind the retirement gender gap

New research from Prudential has found that women expect to retire on £5,750 a year less than men.

The latest Prudential Class of 2012 research found that women expect to retire on £12,250 a year compared to £18,000 for the average man.

Whilst this retirement gender gap raises some questions about equality in financial planning, the good news for women is that the gap appears to be gradually closing.

Last year the retirement gender gap was £6,500. The gap has been closing steady since it was first measured by Prudential in 2009, when they discovered a retirement gender gap of £6,642.

Whilst the gap is closing, expectations for income in retirement have also been falling.

In 2012, the average amount on which men and women expect to retire has fallen to its five year low of £15,500. This includes income from private, company and State pensions.

It was an average of £16,600 last year, representing a fall of 6.6% over the past twelve months.

Certainly it has become tougher to generate income in retirement. Falling gilt yields, on which annuity rates are based, combined with lower stock market values have depressed pension incomes in retirement.

Seeking professional independent financial advice at retirement is essential. This not only ensures that you get the most competitive rates, but that you select the most suitable retirement income option based on your circumstances and objectives.

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