IWD: A time for pension reflection
This Sunday marks one of great significance, as the world comes together to observe International Women’s Day (IWD). It’s been over 100 years since the inaugural IWD was honoured by more than a million people, and although gender equality has come a long way in the last century, certain issues have a habit of arising to demonstrate that the gap, in some respects, has not yet been wholly bridged.
A recent study revealed in This is Money on Thursday suggested that over 6 million people currently aged 40-65 in the UK are set to miss out on getting their full state pensions. The current minimum requirement in order to receive it is 30 years in full-time work, but with this number rising to 35 next year, the figure of 6 million could swell even further.
The minimum requirement will be tapered for those with established working records, and there are ways to make up for missed National Insurance contributions later in life, but the change will sting a lot of people nevertheless, and the statistics suggest that women will be hit hardest of all.
The study confirmed that 39% of women in this age bracket will fall short of the current 30-year minimum, as opposed to just 14% in the case of men. Research by Partnership shows that taking time out of careers to raise children is one of the chief contributors to the shortfall, and the discrepancy between the two genders is therefore no surprise given that 58% of women stop work in favour of taking on childcare as opposed to 5% of men.
Furthermore, the study showed that 10% of people in this category have taken time out from their jobs to look after family members; 11% of women compared with just 6% of men.
In terms of private pension schemes, the figures are even more damning, with estimates showing that women’s average personal pensions are just 62% of men’s, and that women make up the overwhelming majority of those of a pensionable age living below the breadline.
Historical factors need to be considered, given that women could legally be barred from joining pension schemes until 1970. But even today, the Government’s automatic-enrolment scheme – which makes it compulsory for employers to enrol employees earning more than £10,000 a year into a pension fund – inherently favours men given that the bulk of those in part-time or low-paid jobs are female. In fact, one in four women are excluded from the scheme as a result.
At Lending Works, we’re proud to have such an abundance of long-term female lenders – many of whom are of a pensionable age - and are firm supporters of the general shift towards an equilibrium on all fronts.
Yet while the discriminations of the past continue to be eroded, days like Sunday allow us all to take stock, and the issue of pensions provides a glaring example of the inequalities that still exist today. As a society, we should celebrate the progress that’s been made, but, at the same time, avoid complacency at all costs. Addressing the gender disparities with pensions would surely represent a good start.
There is barely a week to go until the conclusion of the 2017/18 financial year, which means that, as ISA season begins to hot up, time is running out to take advantage of your ISA allowance.
At the Summer Budget in 2015, George Osborne had multiple nuggets of good news for investors in peer-to-peer lending (P2P), most notably the announcement of the new Innovative Finance ISA (IFISA).
Over the last decade, there can be little dispute that the reputation of mainstream banks – and particularly the so-called ‘Big Four’ (HSBC, Barclays, Lloyds and RBS) – is at its lowest ebb.
The peer-to-peer (P2P) lending industry is now regulated by the Financial Conduct Authority (FCA). The regulatory framework has been designed to protect customers and promote effective competition.
Loan underwriting is the process that we undertake to analyse all of the information provided by each loan applicant and their credit file to assess whether or not that applicant meets our minimum loan criteria. As part of that process all data is verified, analysed and summarised to paint a picture of each applicant.
When you earn interest from a regular bank savings account, for example, the bank automatically deducts basic rate tax (currently 20%) before paying your interest. With interest earned from peer-to-peer lending, tax is not deducted automatically so lenders will need to declare their income to HMRC.
As 2018 draws to a close, with our bellies full of Christmas turkey, it's only natural to look back on the past 12 months and reflect. No doubt, it's been a turbulent one economically and politically, and not everyone has had it all their own way.