Ethnicity gap in private pension saving

Pic: Shutterstock

Data from the Office for National Statistics has revealed a stark difference in levels of pension saving between people of different ethnicities.

Comparing savings by ONS classifications of ethnic background, median private pension wealth among Bangladeshi, Chinese, Black African and ‘any other ethnic group’ was less than £5,000, compared to £80,000 for households headed by White British citizens.

The proportion of households maintaining a pension also differed depending on ethnic background, with participation lowest in Bangladeshi households, at 48%.

Fifty-seven percent of Chinese households were saving for a private pension, 58% of any other ethnic group, and 59% of Black African households, according to the ONS data.

Participation was highest in Indian households, at 83%, followed closely by White British households at 82%.

The ONS data also showed that private pension wealth is highest for Black Caribbean and White British headed households, accounting for 35% and 33% of their total household wealth respectively.

Helen Morrissey, pension specialist at Royal London, said the differences could be explained partly by different demographics (household heads in some groups are older than others), but that policies should be scrutinised to see if they were serving some groups better than others.

She said: “While this may partly be explained by differing demographics, with some groups younger on average than others, we do need to take a closer look.

“Why are some ethnic groups more likely to have private pension wealth than others? Are policies such as auto-enrolment serving these groups as well as they should? If not, we need to ask why.”

Earlier this year, a report by the Centre for Ageing Better, the Institute for Public Policy Research and University College London found that older people from Black, Asian or minority ethnic backgrounds were less likely to feel able to retire compared to their white counterparts.

  Payroll opportunities on Personnel Today

Browse more payroll jobs

Source Article

Written by HR Today

Stuart couriers seek worker status ruling

Amazon employees in line for $500m recognition bonus