5 practical ways you can help your female clients avoid pension poverty

Women are much poorer in retirement than men and it can be avoided.

This is not because they are worse with money, it’s because women are typically the half of the parenting team that take far more time out of the workplace to raise children.

More than a third of women, 36 per cent, face poverty in retirement, according to Scottish Widows’ Women and Retirement Report 2025. The common denominator is career interruption.  

Women are twelve times more likely than men to take a break to raise children (36 per cent versus just 3 per cent). Unsurprisingly, time out of paid work tends to result in less being paid into a pension.

By age 55, one in four women have been out of work for more than five years. Scottish Widows estimates this can knock around £70,000 off retirement income. That is a very expensive few years!

Some of this is structural; Better sharing of parental leave would help, as would more men contributing to their partner’s pension while they are raising a family. None of this is particularly radical, although it still sometimes feels that way.

What is more concerning is the planning gap. Women manage their money slightly better than men during career breaks, 61 per cent versus 58 per cent, yet they are less likely to plan for those breaks financially.  

In other words, they are good at coping, but they are often left to cope.

This is where advisers have a clear role to play. Professional women stepping out of the workplace to raise families need support before, during and after a career break, not a polite assumption that everything will sort itself out.

Two fifths of women did not plan financially for their career break, and more than half never considered the impact it would have on their retirement. That is not just a failure of personal foresight. It is also a failure of the financial sector to ask the right questions early enough.

We know from previous research that women often feel less confident about investing. Yet when they do invest, they slightly outperform men on average. As women know, when it comes to us fellas confidence is not the same thing as competence.

Targeted support could help close this gap. It allows authorised firms to provide clearer, more relevant guidance on pensions and investments for groups of consumers with similar needs and circumstances. It is not advice-lite. It is advice-shaped.

In practice, this is how advisers can start making a difference.

• Raise career breaks early. Ask clients in their late twenties and thirties how they expect work, childcare and finances to interact. Do not wait until a five-year gap has already done the damage.

• Model the cost of time out. Show the long-term impact of even short breaks on pension outcomes. Numbers tend to focus minds far more effectively than good intentions.

• Keep pensions ticking over. Explore spousal contributions, employer options, and affordable “little and often” investing during breaks. Even modest contributions can make a meaningful difference.

• Normalise investing conversations with women. Do not assume lower confidence means lower appetite. It often just means fewer clear explanations.

• Use targeted support properly. Segment clients with similar life stages and challenges and deliver guidance that feels relevant, not generic.

If advisers get this right, targeted support could become one of the most practical tools we have for narrowing the gender pension gap. And it would be a refreshing change if women’s retirement outcomes improved without anyone having to give up having children in the process.

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