Could TikTok, apps and Gemma Collins boost women’s pensions?

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This article is the latest part of the FT’s Financial Literacy and Inclusion Campaign

Two million women in the UK do not think they will ever be able to afford to retire, according to a landmark study — but pension providers hope greater digital engagement will boost the prospects for future generations.

Now in its 20th year, the Scottish Widows’ Women & Retirement Report found that women still face significantly worse retirement outcomes than men, even though the gender pensions gap is gradually reducing.

The detailed study of over 5,000 UK adults found that 42 per cent of women — and 35 per cent of men — currently face poverty in retirement. Nearly one in seven women said they would need to continue working past the state pension age of 66 to top up their retirement income.

The impact of the motherhood penalty and the cost of childcare on women’s lifetime earnings remained “the most significant barrier”, said Jackie Leiper, managing director at Scottish Widows. In response, the pensions giant is using an array of digital tools to turn younger female customers on to the benefits of starting pension saving early.

“TikTok is where a lot of young people — and young women especially — are getting their financial information,” she said. “Women are really engaged and are keen to learn more about pensions.”

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Scottish Widows launched its own pensions hub on TikTok in September, and video content on pensions and retirement has so far generated more than half a million clicks to its website.

It has combined this with educational content about pensions on its app, which is now used by more than one in 10 of its 4.5mn workplace pension customers. Open Banking technology allows customers to create their own “digital pensions dashboard” on the company’s app, by linking other pension and Isa accounts from other providers. As well as transferring in former workplace pensions, customers can also adjust their level of savings and are prompted to check their state pension forecast.

Almost two-thirds of female respondents said they had done little or no research about how much they needed to save, but Leiper said these initiatives helped people of all ages to engage with pension saving and think about their “tomorrow money” and retirement goals in the round.

The wider pensions world is also embracing social media to boost people’s pension awareness. Social media megastar Gemma Collins recently fronted the “Pay Your Pension Some Attention” campaign funded by the Association of British Insurers and the Pensions and Lifetime Savings Association.

One YouTube ad features Collins in what appears to be a commercial for anti-ageing face cream, before she delivers the killer line: “Sorry hun, but there’s a more important pot to think about — your pension.”

Data from TikTok shows there was a 300 per cent increase in use of the hashtag #retirementplanning in the first quarter of 2024, compared with a year previously. Video content tagged under this banner has received more than 10mn views this year.

Looking back over the past 20 years, Leiper said there had been a “generational shift” in pensions saving following the introduction of automatic enrolment into workplace pensions in 2012, but warned: “On it’s own, it won’t fix this problem.”

Women are over-represented in lower-paid, part time jobs, so many lose out on pension saving as they earn less than the £10,000 earnings trigger for automatic enrolment

Women are over-represented in lower-paid, part time jobs, so many lose out on pension saving as they earn less than the £10,000 earnings trigger for automatic enrolment. Scottish Widows is campaigning for this to be reduced and mandatory contributions raised from the current 8 per cent to 12 per cent, though Leiper accepts that next April’s jump in employer national insurance contributions would push back the timeframes. “We hope that the government’s pension review will create a road map for this, even if changes are not made immediately,” she said.

Leiper added that many of the 2mn women unable to afford to retire were likely to be divorcees, noting how pensions are often overlooked in divorce settlements.

“Because pension assets are held in individual names, they are often a hidden thing,” she said, believing many women simply might not know the value of their husband’s pot.

She said the “annuity conundrum” was another future problem: “Currently, three-quarters of all annuities are put in single names, even if the person is married,” adding that the higher monthly income on single policies was the likely reason why. “Women left widowed might assume they are going to get their husband’s pension — but many do not.”