Gender pension gap: the big change that happens at age 28

Read the full report from the AJ Bell Money Matters team

There is no hiding from the gender pension gap. But looking at how and when it starts could provide valuable insight into the best ways of working towards closing it.

New research from AJ Bell Money Matters shows that among retail investors, men and women’s pension contributions start taking a different path at age 28. Over the long term, HMRC figures estimate that adult women hold 48% less in their pension than men. But what causes it?

It’s impossible to ignore salary differences. Government data tells us that women working full time are paid, on average, 6.9% less than men. That’s a sizeable difference in take home pay, but it also means that women are paying less into their pension each month, which has a snowballing effect on their pension pot over time.

As many women take career breaks to have children or to care for family, cracks start appearing from missed or lower contributions in the key years when pension growth is so important. These cracks manifest as a chunky gender pension gap when it comes to retirement.

*Source: AJ Bell/Opinium. Based on a nationally representative survey of 2,000 UK adults carried out online between 2-7 April 2026, as well as a boost survey of 100 28-year-olds.

Why does the gap begin at age 28?

At the age of 28, many women will be starting to think about getting married or starting a family and graduates might also be looking over their shoulder at their student debt balance. Plus, the ONS’ most recent data suggests the average woman in the UK has her first child at 29, which is both a huge life event and a financial shift.

Unfortunately, these competing priorities mean many women actively choose not to boost pension contributions. It’s a crucial time in their lives as younger women could miss out on the power of investment growth over a longer timeframe.

More women start to work part time or take career breaks at this age too, as children come into the picture, and the pension system can leave them behind.

What’s more, the financial pressures of having kids mean that many women might even stop contributing to their pension altogether during longer periods of maternity leave. Less money rolling into pensions means investment growth needs to do some seriously heavy lifting to bridge the gap.

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Auto-enrolment has done wonders to get more workers saving for retirement, and from a younger age, but the system means that many people are adopting a ‘set and forget’ approach – either not saving enough, or in some cases, not saving into a pension at all. And when women take breaks in their careers, no longer benefitting from these automatic contributions, the gap starts to appear quickly.

Even as women begin to return to work, many choose part-time work or self-employment. For women between the ages of 29 and 40, 21% said they were working part time, in comparison to just 5% of men.

Self-employed people do not benefit from auto-enrolment, and those who are working part-time are only enrolled if they are earning £10,000 a year from the same employer. So, if they work across a number of different jobs, they might also miss out on employer contributions into their pensions.

Pension priorities catch up at 41

The priority gap between men and women when it comes to their pension doesn’t last forever. As women hit age 41, they begin to prioritise their pension equally to men. Almost one in three (29%) women aged 41 to 55 name their pension as a financial priority, compared with 30% of men.

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But it’s never too late to make a difference – at age 41, if £100 is added to a pension a month that equates to an extra pot worth £42,500 after 20 years. That increases to over £66,700 if the payments continued until age 67 (the current state pension age), all helping to support a more comfortable retirement and perhaps a well-earned treat or two. This £100 a month would cost a basic rate taxpayer just £80 a month, with £20 added on top by the government in pension tax relief, and even less for those who pay tax at a higher rate**.

**Assumes your pension pot grows by 6% each year and includes annual charges of 0.6% and all dealing charges.

How can we fix the gender pension gap?

For individuals

• Show your pension some love. Check how much you and your employer contribute, and where your pension is invested. Don’t be afraid to look beyond the default fund if other options better suit your goals.
• Be frank about your household finances. If you live with a partner, you’ll need to have open and honest conversations about money. If taking maternity leave or reducing hours affects your pension contributions, consider whether a partner can help top up your pension or gift funds for you to invest.
• Take advantage of tax benefits. Many employers will increase contributions if you do too, giving you extra money into your pension. Even if you’re not automatically enrolled, you can usually ask to join your workplace scheme. Self-employed people are left to choose their own pension route, but there are ready-made options out there to help. Either way, pensions offer significant tax benefits. For some pensions you get all your tax savings upfront. But if you pay into a SIPP or another personal pension and you are a higher or additional rate taxpayer, you may have to claim more income tax relief directly from the government.

For pension providers

• Communicate to women in ways that reflect their reality. Women may take career breaks to care for children or parents, work part-time or face slower career progression than men. Pension communications should reflect diverse life experiences and goals rather than a linear or one-size-fits-all approach.
• Focus on the incentives to save into pensions. Highlight the benefits of pension saving, including employer contributions, tax relief and the long-term impact of compound growth. Providers should also raise awareness of how pensions can support eligibility for allowances and childcare benefits, including child benefit.
• Ditch the jargon. Pensions often seem complicated, but the basics are actually quite straightforward: start saving as soon as you can, keep making regular contributions, and make the most of the extra money from your employer and the government. Clear, jargon-free communication can help everyone feel more confident about saving.

For policymakers

• Close the gender pay gap. Pension contributions are based on pay, so if women are paid more, their pensions will be healthier. Policymakers must continue to strive to close the gender pay gap by making sure women are given the same career opportunities, and importantly, the same pay as their male counterparts.
• Change the framework for automatic enrolment. Automatic enrolment has been an incredible success in creating more pension savers but it’s not without its faults. The law was changed in 2023 to lower the minimum age from 22 to 18 and to base minimum contributions on the first pound of pay upwards. The government should now set out a clear timeline for these planned reforms. Lowering the earnings trigger and assessing income across multiple jobs would also help more women benefit from automatic enrolment.
• Stop pension change speculation. Repeated speculation about pension tax changes can undermine confidence. The Treasury needs to recognise that people’s fears are real and move swiftly to close speculation where it arises. By committing to a ‘pensions tax lock’ to maintain current tax advantages for at least the rest of this Parliament, the government can give individuals the certainty and peace of mind to save for the long term.