Women are more than twice as likely to worry about meeting their day-to-day living costs (16%) than their male counterparts (7%), according to research from Close Brothers.
Close Brothers' Financial Wellbeing Index 2019 scored employee wellbeing in seven areas of financial health. In the UK employees scored their wellbeing at an average of just 53.6 out of 100. Female employees were found to struggle most, scoring 48.1 compared to a score of 58.3 for their male counterparts.
The research revealed issues with long-term financial planning for women. Almost half (48%) said that they felt unprepared for retirement compared to 25% of men. Additionally, a third of women (33%) said that they are not confident they will be able to achieve their long-term financial goals, nearly twice that of their male co-workers (19%).
This may be due to the amount men and women have accumulated in their pension pots. Close Brothers’ Lifetime Savings Challenge 2017 research revealed that the average amount in a woman’s workplace pension scheme is less than half that of their male colleagues (£53,000 vs £120,000). It also found that 40% of all employees lack confidence in financial decision-making.
The Financial Wellbeing Index also stated that there is a lack of confidence in understanding financial products and those best suited for specific goals. Only a third of women (35%) said they were confident in choosing the most suitable financial product(s) for their long-term financial goals, compared with 50% of men.
Jeanette Makings, head of financial education at Close Brothers, said that the research shows women are not only being paid less but are saving less too.
“Progress is being made, but the stark gender imbalance in financial wellbeing is a reminder of the scale of the challenge that still faces female employees and their employers. With more women in lower-paid roles women are being paid less and therefore saving less, to the detriment of their financial wellbeing. But it is not the only underlying cause,” she said.
“The pressures and financial circumstances of female employees are often different to those of their male counterparts, so the level and focus of financial education on offer needs to reflect that. But the good news is that these issues are solvable. Once the key pinch points for financial wellbeing have been identified employers should be better prepared to provide tailored strategies to improve women’s financial health and confidence.”
Cary Cooper, professor of organisational psychology at the University of Manchester, added that employers must place greater emphasis on financial wellbeing to create an even playing field: “It is quite right that the campaign for pay equality continues its march onward, but similar priority should be given to the financial wellbeing imbalance. Female employees must be given access to the necessary tools and guidance to bring their financial wellbeing levels up."
The Financial Wellbeing Index 2019 is based on surveys conducted among 1,003 employers with 200 or more employees, and 5,003 employees from companies with 200 or more employees. The Lifetime Savings Challenge 2017 is based on surveys conducted among 1,000 employers with 200 or more employees, and 2,009 employees from companies with 200 or more employees.