While progress has undoubtedly been made in recent years, there is still a noticeable gender pensions gap between men and women – something that has real consequences.
On average, a 55‑year‑old woman today lives three years longer than a man of the same age and has double the chance of reaching 100. Despite this, just 24% of women are on track for a comfortable retirement versus 36% of men.
These figures aren’t simply statistics; they represent life decisions and experiences that are highly relatable to women. These moments often include taking career pauses, moving away from full-time employment, or preferring saving over long-term investing – a financial area where many feel less confident.
Sometimes these choices have to be made out of necessity, but a lot of the time women just haven’t been given the simple, helpful advice or support they need to feel totally confident about their long-term financial well-being.
Annuities have quietly transformed into something far more flexible and feature-rich than many people realise
It’s a huge issue across our society, and a recent report from the University of Edinburgh and the Scottish Widows Women & Retirement Report both point to the UK’s pension system and the advice sector needing to fix this disparity.
Even if women have built a healthy pension pot, the crucial question is how to make those savings last for their entire life.
Annuities on the rise
Given all this, it’s understandable why annuities are becoming popular again – and it’s not just down to better rates. One of the persistent myths I come across is that annuities are rigid and outdated, yet they’ve quietly transformed into something far more flexible and feature-rich than many people realise.
For women who’ve had fragmented career patterns, taken time out or built pension wealth differently to their partners, annuities can be a powerful aid for long-term security.
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Annuities remove the uncertainty of market fluctuations and there’s no need to worry about managing investments or keeping an eye on withdrawals, which can be a worry with drawdown.
Modern-day annuity solutions can also be highly tailored. This can include escalation options that help protect against inflation, the provision of dependent benefits for partners, built-in guarantee periods that ensure income is paid out for a set time and value protection measures on all or a portion of the initial outlay.
In many ways, annuities provide the best features of the DB pensions we still view as the gold standard in the industry, offering stability, predictability and a lifelong income.
Retirement planning that works
With lower pension savings on average, women are undoubtedly more exposed to financial dependency, something that needs to be addressed as we move forward.
Here, it’s important for women to feel empowered to prioritise their ‘wealth care’ to secure long-term financial security.
Modern-day annuity solutions can provide women with a powerful mix of reliability, flexibility and long lasting value
A critical part of that is open, proactive discussions with partners about retirement finances. Since many couples build their wealth together – across savings, property and pensions – it makes sense to plan retirement jointly. This way, both partners know exactly what income they’ll have, and can think about dependents and passing on wealth.
When thinking about annuities, taking time to consider dependents’ benefits really matters. It is one of the simplest ways to make sure no one is unintentionally left financially vulnerable later on.
Modern-day annuity solutions can provide women with a powerful mix of reliability, flexibility and long lasting value – exactly what is needed to navigate longer lives.
When combined with open planning with partners, women can build an income that protects them and their families. And truly, what better way to approach later life than with real confidence, clarity and security.
Carolyn Jones is retirement director at Scottish Widows
