The gender pension gap on how much men and women put aside for their retirement is at its narrowest on record, according to new research.

There is just a one per cent with the proportion of women saving adequately hitting a new high of 59 per cent, almost three in five over the age of 30, compared to 60 per cent of men.

However, while the Scottish Widows’ latest Women and Retirement Report suggests progress has been made, the persistent pay gap and part-time working ratio means women saving adequately on the median wage of £19,600 are still saving £1,300 a year less than men.

This means for a woman to save the same amount into her pension as a man, she will need to work an extra 37 years - which would take her over the age of 100 if retiring at State Pension age.

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The impact of saving for a pension pot during the pandemic was also looked at with some women admitting they had to take a savings hiatus.

Young women are among those struggling most to save for later life. Just 46 per cent of those in their 20s are saving the recommended minimum 12% of salary. This compares to 54 per cent of men the same age, and to almost two-thirds of women in their 50s, showing that women do tend to save more as they get older.

However, not saving more while young means women miss out on the benefits of compound interest, which can help savings increase substantially over their working lives.

Jackie Leiper, Managing Director, Workplace Savings at Scottish Widows, said: “While we’re heartened at the record levels of saving, there’s still a mountain to climb before we reach true gender pension parity. Women face decades of extra working before they’ll have a pension to match that of a man’s, which is unfair and unacceptable. Until we can resolve structural inequalities, from the gender pay gap to the uneven division of labour at home, we will never have pension equality.”

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The report added Automatic Enrolment has been a huge driver in getting more women saving for the long-term, but there are still a number of structural challenges preventing a truly level playing field.

Women are still paid less than men, significantly impacting their ability to save. Of those in full-time jobs, men earn on average £6,100 more a year, a figure that increases to £10,800 for all employment types.

Extra commitments such as childcare also tend to fall on women, reducing the number of hours they are able to work and therefore limiting earnings. In 2020, three-quarters (75 per cent) of all part-time workers in the UK are women and the majority of UK families with a child under four consist of a father working full-time and a mother working part-time.

These challenges are likely to have been amplified by the pandemic as women are more likely to be working in shutdown industries, such as the hospitality trade, where many have been furloughed, seen their hours reduced or been made redundant.

As part of its research, Scottish Widows spoke to a group of women about how the pandemic was affecting their working life and pension prospects.

Ms Leiper added: “In a matter of months the pandemic is reversing years of progress. We’re calling for urgent pension reforms that will help more women save more for retirement, including improved childcare provisions, enhanced pensions for those on maternity leave, the inclusion of pensions in divorce proceedings, and the scrapping of the auto-enrolment minimum earnings threshold.”

Chartered financial planner Gill Hunter, of Glasgow-based Fitzallan investors and planners, welcomed the news the gap had closed.

"This is welcome news but I think employers have a major role to play in encouraging their female employees to think about it early. I was around 40 when I began to think about it seriously and was shocked that at halfway through my working life, I was only at 10 per cent of where my pension pot should have been. I wanted to be in control of my own future and began to look into it. My daughter is only 24 and I have encouraged her to think about it as women do have career challenges in the way in terms of maternity leave and finances taking the strain in other areas such as childcare when available funds can be affected."

*Two major surveys, one involving more than 5,700 people and another with more than 2,200 people, were carried out for the report.