Women not saving in tax-efficient ways FFT release
Women set to feel greater pain of rate cuts as nearly half shun pensions and Isas in favour of savings accounts
Scottish Friendly’s Family Finance Tracker reveals that nearly half (46%) of women are opting to hold their long-term savings in a savings account, instead of more tax-friendly options such as a pension or ISA wrappers, compared to 39% of men.
Meanwhile, 33% of men are opting to use pensions, compared to just 24% of women.
In the research, of 2,600 UK adults, long-term savings were defined as thinking longer than five years ahead, such as saving for retirement, a deposit on a property or starting a business.
The Family Finance Tracker, commissioned by Scottish Friendly and the Centre for Economics and Business Research (Cebr), sets out to track how UK consumers are managing their short-, medium- and long-term financial goals and priorities.
The Monetary Policy Committee’s (MPC) decision to hold the base rate in September, but with speculation that it could still be cut gradually before the end of the year is out raises the spectre that compounded inflationary drag is likely to disproportionately negatively impact women.
The real term value of money held in savings accounts will be eroded with increasing pace with each cut.
Official government data1 shows that women are still being paid just 91p for every £1 their male counterparts earn, so are already at a disadvantage when it comes to making their money work for them.
Scottish Friendly’s savings specialist Kevin Brown says: “Women are already having to work harder for their money so it would be a travesty that they then lose out on further building up their hard-earned savings through tax-efficient wrappers and jeopardising future plans as rate cuts start biting. Whatever sits at the root of what appear to be gender choices, as an industry and as a socially responsible modern mutual, we need to ensure parity of savings’ growth opportunities.”
1 Gov.uk Gender Pay Gap Service
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Notes to Editor:
The research was conducted by the Centre for Economics and Business Research (Cebr) and 3Gem. Comprised 2,600 UK adults aged between 18 years and 65+. Short-term financial goals were described to participants as being goals up to 6 months ahead, medium-term as being between 6 months to 5 years ahead, and long-term as 5+ years ahead.
About Scottish Friendly
Scottish Friendly is a leading UK mutual life and investments organisation. It provides investors and their families with a wide range of investment and protection solutions and provides life and investment products and services to other financial organisations.
Scottish Friendly has roots stretching back to 1862. Established as the City of Glasgow Friendly Society, its name changed in October 1992 when it took over Scottish Friendly Assurance.
The Group has flourished through a three-part growth strategy of organic growth, mergers and acquisitions, and business process outsourcing.
Scottish Friendly, Galbraith House, 16 Blythswood Square, Glasgow, G2 4HJ
Scottish Friendly Assurance Society Limited. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.
Scottish Friendly Asset Managers Limited. Authorised and regulated by the Financial Conduct Authority.
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