How can we improve financial health amongst women?

Dani Skerrett

by , Team PensionBee

at PensionBee

19 Dec 2022 /  

Close up of women saving money into a piggy bank

It may not come as a surprise to learn that women’s financial health’s statistically lower than men’s. In fact, a recent study by Investment Platform, Ellevest, found that financial health amongst women is the lowest it’s been in five years.

What do we mean by financial health?

Simply put, financial health (or financial wellbeing) is used to describe the state of someone’s finances. Factors that impact your financial health include your income, how much in savings you have, whether you have any debts or loans, as well as economic factors like inflation. And while we know there’s a gender pay gap, which leads to a gender pension gap, it’s also now apparent that there’s a disparity between genders when it comes to how they feel about their overall financial situation.

Why’s financial health in women so low?

Low financial health affects women of all ages - those who are older face a challenging economy which impacts their spending, and could leave them worrying about the finances they’ll have for their retirement, while women of a younger generation are battling with the cost of childcare, rising housing prices and job security. Some of the key indicators that contribute to a lower financial health for women include:


We know that there are historic income disparities between men and women. But what’s the state of play today? According to data from the Office for National Statistics (ONS), the gender pay gap among full-time employees in 2022 is 8.3%, which is up from 7.7% in 2021.

Reasons for this could include women filling more part-time roles and working in keyworker sectors, like education and healthcare. While these sectors tend to offer more flexibility, their employees disproportionately feel the impact of low pay.

Child and elderly care

The issue of access to affordable childcare and parental leave is one that’s closely linked to the gender pay gap and is also a key reason why women tend to fill more part-time roles than men. Our own research found that the gender pension gap could be closed completely if men took an equal share of childcare responsibilities.

But it’s not just childcare that plays a part in women falling short in terms of pay and savings. We also found that female savers between the ages of 50 and 64, who take on the caring responsibilities for elderly relatives, experience an hourly pay gap of 25% and end up with £139,451 less in their pension pot than their male counterparts.


So, bearing in mind that women earn less and tend to take time out of work for caring responsibilities in more cases than men, it’s no surprise that this impacts the amount of money that women are able to put towards savings like ISAs and pensions. If they’re enrolled in their workplace pension, the amount their employer contributes will also be less than their male counterparts, as employer contributions are based on a percentage of salary.

Global and economic changes

Global issues play a part too, and the effects of COVID-19, such as redundancy and school closures, have left women’s financial health worse off now than before the pandemic.

While inflation impacts everyone’s financial situation, this is more true for women - who tend to be responsible for more household shopping, such as groceries and toiletries, all of which are greatly affected by rising prices. And of course, the impact of rising prices tends to be worse for those on lower incomes which, as previously mentioned, is disproportionately women.

The UK is entering its second recession in two years, and past economic issues suggest this is likely to affect more women than men. When the last recession was announced in 2020, dubbed the ‘She-cession‘, experts commented that the outlook for women was particularly bad, as they were already being hardest hit by job losses and falling pay, which only worsens during times of economic downturn.

What can be done to improve financial health amongst women?

At industry level

Greater flexibility from employers is needed across most industries to improve women’s financial health. Introducing policies such as working from home, flexible hours and job sharing offer many women the opportunity to balance their family life while keeping jobs they love and continuing to grow in their careers.

The financial services industry’s heavily male-dominated which means products, including fintech, resonate more with men than women. So it’s crucial that accessibility to financial products is improved.

At government level

Improvements to childcare are key to ensuring women can achieve work/life balance and ultimately, improve their financial health. Crucially, the cost of childcare‘s something that needs to be addressed by the government urgently.

Whilst legislation exists to ensure companies across the UK report on the gender pay gap, more needs to be done to implement any real change. A disappointing report by the Institute for Fiscal Studies in 2021 found that government policies have made almost no difference to the gender pay gap for the last 25 years.

Access to benefits is another area that should be addressed to help improve women’s financial prospects. The UK’s benefits system is notoriously difficult to navigate - with many people not claiming for the help that they’re entitled to, simply because they aren’t aware or don’t know how. Analysis by Entitledto, an online benefits calculator, found that around half a million families are missing out on just under £1 billion in Child Benefit. Many organisations are calling on the government to improve the benefits system including Child Poverty Action Group and Money and Mental Health.

What can individuals do?

First off, you should find out what you’re entitled to, whether that’s by checking your eligibility for Child Benefit or, what your options are when it comes to taking parental leave. If you aren’t sure, reach out to your company’s HR department and make sure you’re up-to-date with Statutory Parental Leave rights.

If you have a partner, make sure you’re being fair with your family’s finances. If you’re taking time out of work for parental leave or other care responsibilities, it’s a good idea to work out how you’ll organise your finances, like your pension, ahead of time. For example, it’s important to consider whether you’ll continue to save and contribute to your pension while you’re not working, or whether your partner will contribute on your behalf in these special circumstances.

Focus on your financial future by making the most of the amount you can contribute to your pension yourself but also, if you’re employed full-time, make sure you’re auto-enrolled into your workplace’s scheme to benefit from employer contributions too.

Not employed full-time? If you’re self-employed, work on a freelance basis or don’t work enough hours to benefit from Auto-Enrolment, make sure you’re still saving for the future by starting a self-employed or personal pension.

If you’re able to, consider investing your money for the medium to long-term rather than saving it in a cash account for greater opportunity of growth over time, whether that’s in a stocks and shares ISA or pension.

If you’re wondering how you might be able to support your partner, friend or family member, read our blog on 10 things men need to know about money (and women).

What does the future look like?

There are far more policies than ever before supporting women and their finances. The introduction of Shared Parental Leave and gender inclusive parental leave policies, and companies such as us here at PensionBee offering this to their employees, give hope to a more equal future for women and their financial health. But sadly, seven years after the policy was launched, data from 2021 found that take-up’s still only between 2-8% of eligible couples. So there’s still lots of work to be done.

Despite the many obstacles facing women when it comes to their finances, it’s encouraging to see positive trends appearing. According to ONS data from 2021, women are taking on more leadership roles than ever before and in 2022 they reported that the largest fall in the gender pay gap since before the pandemic - from 16.3% to 10.6% - is among managers, directors and senior officials. So we can only hope this progression continues well into 2023 and beyond.

Improving your financial outlook

One of the most accessible things you can do to improve your financial health and resilience is to further educate yourself and gain greater control over your finances. There are some great resources out there as well as right here on our website including our Pension Academy video series, Pensions Explained articles and other blogs that can help you understand personal finance. Here are three things you can do to improve your financial health today:

  1. Start engaging with your finances whether that’s creating a budgeting spreadsheet, consolidating your pensions, investing some of your money for long-term growth, or setting yourself financial goals for the next six months or year.

  2. Join the community at Vestpod, a platform that aims to help women achieve financial independence through live events, podcasts, newsletters, forums and more.

  3. Listen to our Pension Confident Podcast and learn from personal finance experts each month who discuss; whether you should put more money into your mortgage or your pension, looking after your financial wellbeing, how to cope with debt and ways to plan and save for a happy retirement.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. Anything discussed on the podcast should not be regarded as financial advice.

Don’t forget your own finances

Get started in 5 minutes. Combine your old pensions online, today.

Get started now

Mobile PensionBee analytics chart
Mobile PensionBee analytics chart
Apple Store logo Google Store logo