COVID-19 widens gender savings gap, with women having a third less money

·3 min read
Men now have over £8,000 more in savings than women. (Joe Giddens/PA Archive/PA Images)
Men now have over £8,000 more in savings than women. Photo: Joe Giddens/PA Archive/PA Images

The gender savings gap has widened as a result of the COVID-19 pandemic with women now having a third less saved, research shows.

While the average man in Britain has £24,880 ($32,256) in savings, women have just £16,842 by comparison — 32%, or £8,038 less, according to a consumer study by VoucherCodes.

Just over six months after lockdown was introduced in the UK, the coronavirus crisis has widened the gender savings gap even further, the study found.

More women than men are relying on previous savings to cover essential costs during the pandemic — depleting their already smaller savings pot. Over a third of women (35%) admitted to dipping into their savings over the past six months, compared to just 15% of men.

This figure jumps to more than half (54%) for furloughed women, compared to two in five men on the job retention scheme (40%).

Two thirds (64%) of furloughed workers said the scheme and resulting pay cut has meant they have not been able to save their goal amount each month.

READ MORE: Why women are stereotyped as being terrible with money

Women have seen the biggest hit to their financial security as a result of COVID. Over three quarters of furloughed women (78%) have not been able to save as much money as pre-pandemic, compared to just half of furloughed men.

The widest gender savings gap is among millennials, with women aged 23 to 38 reporting 60% less in savings than their male counterparts — a difference of £16,000.

This is followed by Gen Z, with those under the age of 23 reporting a 47% gender savings gap.

Much of this can be attributed to the UK's gender pay gap, which currently stands at 17.3%, according to official data.

Just 38% of British women said their current wage is enough to allow them to save their goal amount each month — whereas half (51%) of men said the same.

On top of having the widest gender savings gap, millennials also have the most disparity when it comes to whether their wage allows them to save.

READ MORE: Women take eight months longer to save for first home

Just over a third (36%) of millennial women said they are able to put away the cash they want to each month, compared to over half (55%) of men.

On the other end of the scale, baby boomers have the smallest disparity of any generation, as about half of women (50%) and men (53%) are able to save their goal amount.

Looking ahead, the nation is cautiously optimistic when it comes to predicting whether coronavirus will have a long-lasting impact on their savings, the research found.

Nearly six in 10 women (55%) and men (57%) alike think their savings will be able to recover in the long term.

Earlier in their savings journey, Gen Z-ers predict a tougher time, with just 42% of women and 50% of men predicting that their savings will make a full recovery.

Those most worried about the future are women who have been furloughed, with 77% admitting they are concerned they will never be able to replenish lost savings.

READ MORE: The HERoes top 100 women role model executives 2020

“This report is really eye opening, exposing how far we as a nation need to come to achieve financial equality,” said Anita Naik at VoucherCodes.

“It’s especially concerning to see young women and those who have been enrolled on the furlough scheme during COVID-19 have been most affected, as this represents such a large number of women in the UK.”

To help reduce the amount you rely on your savings, budgeting is the most effective way to ensure that all essential costs are covered.”

Citizens Advice offer a “free and easy-to-use budgeting tool on its website, and shoppers may find it beneficial to install browser extensions that automatically find discounts as they shop, Naik added.

WATCH: What is the new job support scheme?

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting