Recent research from Now:Pensions and the Pensions Policy Institute (PPI) reveals a significant pension savings gap for divorced women in the United Kingdom. The findings indicate that, on average, divorced women possess £53,160 less in pension savings compared to their male counterparts. This disparity underscores the pressing concerns regarding retirement security for women who have undergone divorce.
The study highlights that divorced women hold only 39 percent of the pension wealth of divorced men. Specifically, median pension wealth stands at £32,640 for women, while men average £85,800. This inequality is not limited to divorcees; even among married individuals, the gender pension gap is pronounced, with men holding a median pension wealth of £111,540 compared to just £43,656 for women.
Divorce Settlements Often Ignore Pension Assets
Data from the study reveals that only 11 percent of the over 100,000 divorces anticipated in 2024 and 2025 involved pension attachment orders. Alarmingly, 71 percent of divorce settlements did not account for pension assets, frequently prioritizing housing instead. This oversight contributes to the long-term financial insecurity faced by many divorced women.
When considering retirement age at 66, pension savings must sustain men for approximately 13 years and women for about 17 years. The average annual pension income for divorced women is just £13,893, slightly exceeding the UK’s minimum retirement living standard of £13,400. In contrast, divorced men receive an average annual income of more than £18,500.
Samantha Gould, head of campaigns at Mercer UK, emphasized the research’s implications, describing the pension inequality facing women post-divorce as “stark” and with “serious implications” for retirement security. She stated, “We are committed to promoting greater pension equality for all, regardless of gender.”
Calls for Automatic Pension Sharing
To address this imbalance, Gould advocated for the implementation of automatic pension sharing in divorce, a measure that could help narrow the pension savings gap and ensure divorced women can achieve the retirement they deserve.
Joanne Segars OBE, chair of trustees at Now:Pensions, echoed these concerns. She warned that too many groups in society are “locked out” of the pension auto-enrolment system, exacerbating the growing pension savings gap. Segars noted, “As a consequence, these groups find themselves on the wrong side of a growing pension savings gap.”
The research serves as a critical reminder of the financial challenges that divorced women face in preparing for retirement. With policymakers and advocacy groups pushing for reforms, the hope remains that measures will be implemented to promote greater equity in pension distribution and secure a more stable financial future for all divorced individuals.
