Career breaks push one in three women into pension poverty

18 November 2025

More than a third (36%) of women face poverty in retirement, according to Scottish Widows’ latest ​Women and Retirement Report (PDF, 3MB).

The research reveals that more than half (58%) of women at or near retirement have taken a career break compared to just 12% of men, and women are 12 times more likely to take a break in career in order to raise children (36% vs 3%), leading to loss of income and gaps in their pension contributions. 

By age 55, one in four (24%) women have been out of work for more than five years - which could result in a £70,000 hit at retirement.  

Women taking a five-year career break at 35 years old¹, as an example, would reach age 67 with a pension worth £512,000². This is £69,380 less than women who don’t take a break in their career, with the gap driven by both missed contributions and lost investment growth.

Failure to plan ahead creates financial pressure for certain groups 

Whilst Scottish Widows’ data shows that women manage their money slightly better than men during career breaks (61% versus 58%), they are less likely to plan for them financially. 

Adding to this pressure, the research shows that two fifths (40%) of women didn’t plan financially for their career break, and over half (56%) never considered the impact it would have on their retirement. And, as many as 42% of women found that the break in their career reduced their ability to save, compared to 37% of men. 

This year Scottish Widows has calculated the median total private pension³ for women at retirement is £173,000 vs £286,000 for men. That means the gender pension gap between women and men is now £113,000 (32%) - an increase since last year’s £100,000 (30%). 

Susan Hope, Retirement Expert at Scottish Widows, said: “Millions of women in the UK are living with the gender pension gap and they don’t even know it. To achieve true equality in retirement, we need to make sure career breaks don’t break women’s future financial security.  

“There are a couple of straight-forward ways to help address these gender pension concerns. We need to improve awareness and take-up of shared parental leave policies. This policy is critical, yet four in five (80%) women who had children in the last 10 years didn’t take advantage of it. This represents around 2.7 million working mothers⁴, and 8% revealed that their spouse’s workplace was not supportive.  

“Separately, spouses should be actively saving into women’s pensions during any career breaks, if possible. This is also known as third party contributions and, while often overlooked, is a helpful financial planning tool. Not only can it maximise tax relief for those who have used up their allowance, this can help to plug gaps in pension contributions while earning power is limited.  

“Employers also continue to play an important role in pension contributions during maternity leave. Fortunately for women, employer contributions in a workplace scheme are often calculated based on their pre-leave salary.”  

Dame Denise Lewis (DBE), former Team GB track and field athlete, working with Scottish Widows on the launch of the Women and Retirement Report, said: “Throughout my sporting and punditry career, there have absolutely been times when I’ve stepped away from work, whether that was due to injury or raising my family. Those experiences taught me first-hand how important it is to have a financial plan that gives you security when your income is more up and down – something so many women can relate to. 

“And crucially it’s not only a challenge at the time, it also has a real impact on our futures. The more we can encourage women to start those vital kitchen table conversations about what their future looks like and how they’ll afford it, the better.” 

Download full press release (PDF, 156KB)

Notes

Methodology

The Women and Retirement Survey was conducted online by YouGov Plc from 29th August to 8th September 2025 across a total of 4,091 adults aged 18+, weighted to be representative of the UK adult population. The survey asked general questions on pensions and retirement planning, as well as savings, investments, career breaks and financial planning behaviours. 

The Retirement Report Survey was conducted online by YouGov Plc between 22nd January and 11th February 2025 across a total of 5,167 adults aged 18+, weighted to be representative of the UK adult population, and underpins the National Retirement Forecast (NRF) analysis benchmarked to the Pensions UK’s Retirement Living Standards. This main survey included general questions on pensions and retirement planning.

Notes to editors

¹ Office for National Statistics
² According to Scottish Widows’ pension analysis. Assumptions 3%, Salary increase, 5% investment growth and the career break comes back on a new higher salary. The total pension gap is £69,380.14.

³ Median private pension pot size for those with a private pension. This does not include other savings available at retirement.
⁴ Using ONS Labour Force Survey data (Feb-Apr 2025), around 9.4 million women aged 25-49 are in employment. Applying survey findings that 36% of women take career breaks to have children and 80% did not take up Shared Parental Leave, this implies that around 2.7 million working mothers may be missing out on the long-term financial and pension advantages that SPL can provide. Restricting the range to 25-44 years yields roughly just over 2 million women.

About Scottish Widows

Founded in 1815, Scottish Widows is part of Lloyds Banking Group, the UK’s largest digital bank and financial services group. With more than £232bn assets under administration and more than 6 million customers, Scottish Widows’ award-winning product range includes workplace and individual pensions, annuities, life cover, critical illness and income protection, as well as savings and investment products.

More than 2 million customers access Scottish Widows products and services through the Lloyds Bank and Scottish Widows apps, in addition to accessing directly through independent financial advisers. The Scottish Widows Platform is trusted by more than 18,000 advisers and 5,400 advice firms, which manage the pensions and investments of almost 166,000 clients.