Georgina Oxton, LV= Equity Release Divisional Manager 

Feeling confident about living comfortably in retirement is an important financial goal for many. However, our Wealth and Wellbeing research¹ revealed that 60% of UK women lack confidence in having sufficient savings for a comfortable retirement, which is a significant 14% higher than men. 

This disparity carries significant implications. The Office for National Statistics has reported that women in England and Wales can expect to live into their 80s or beyond², meaning any retirement income may need to stretch further. This vulnerability is increased for women who experience divorce or are left widowed, meaning they may find they have less to retire on than expected, especially if they want to continue living in their current home during retirement – something that 71% of UK women over 55 would like to do.¹

A major factor contributing to the retirement savings gap is the ongoing gender pay gap, which, according to the ONS, is currently 6.9%.³ This has real-life implications, as highlighted by the 2024 Gender Pay Report from Now Pensions, which reveals that on average, women must work an additional 19 years⁴ to retire with the same pension savings as men—a statistic as shocking as it is unrealistic.

Compounding this issue is the parenthood penalty, where many mothers find themselves facing a pension shortfall of up to £183,000⁵ due to career interruptions or reducing hours for childcare. This ultimately leads to lower lifetime earnings and consequently, lower retirement savings. 

According to the Retirement Living Standards⁶, individual retirees need at least £31,300 per year to fund a moderate lifestyle. Yet, the average pension savings pot for women is around £69,000, which would only sustain them for two years of retirement, while men enjoy an average pension pot of £205,000.⁴ This is backed by our research⁷, which found that almost half (48%) of UK women over 55 don’t pay anything into a pension, with many holding over 50% of their wealth in shared household assets, including property.⁸ This presents a unique opportunity to incorporate property wealth into a comprehensive retirement strategy through a lifetime mortgage, a loan secured against the value of a property, which enables women to leverage the value of their home as part of their later life financial plan.

Recognising that circumstances can shift unexpectedly, the flexibility of an LV= Lifetime Mortgage is particularly beneficial for women, who often face greater challenges in later life. All LV= Lifetime Mortgages come with fixed Early Repayment Charges (ERCs), providing transparency and peace of mind for clients if they choose to repay some of their loan. Furthermore, our unique ERC structure sets the ERC period for future drawdowns from the original loan completion date rather than the point of advancing future drawdowns. This provides a financial framework that allows women to make informed decisions should they experience a change in income, health or living situation.

With the Lifestyle range’s inheritance protection feature, women can safeguard a financial legacy for their loved ones. This is a significant consideration, as 37% of UK women over 55 express that reassurance about inheritance is a key factor when considering a lifetime mortgage.⁷

Downsize protection is also available on LV= Lifetime Mortgages from day one. For women who may want to downsize to a more manageable home, or relocate to be closer to family, this option enables them to take control of their situation without facing financial penalties, and is a benefit that 38% of UK women over 55 said would appeal to them when considering a lifetime mortgage.⁷ 

The flexibility embedded in our Lifetime Mortgages enables women to maximise their current financial opportunities while ensuring long-term security. 

Find out more about LV= Lifetime Mortgages. 

Sources:

1. LV= Wealth and Wellbeing report (December 2024)
   
2. National life tables – life expectancy in the UK - Office for National Statistics
   
3. Gender pay gap in the UK - Office for National Statistics
   
4. Gender pensions gap | Fair Pensions For All
   
5. The pensions parenthood penalty holding women back - Royal London
   
6. Home - PLSA - Retirement Living Standards
   
7. LV= Wealth and Wellbeing report (September 2024)
8. Women’s Budget Group: Report-WAS-Sept-2023-FINAL-3-10-2023.pdf