Ethnic and gender gaps in private pension participation in the UK

Abstract Being financially prepared for later life can make the difference between living in poverty and not. Existing research in the UK has evidenced gaps in pension protection between working-age individuals from different minority ethnic communities; however, research that examines how ethnicity interacts, specifically with gender and other demographic, health and socio-economic characteristics to affect pension membership, is lacking. Using data from the UK Household Longitudinal Study between 2009 and 2023, this paper first examines patterns of continuity and change in pension membership among working-age individuals from minority ethnic groups. Focusing on the most recent wave, the analysis then assesses the importance of ethnicity and gender, alongside other demographic, health, socio-economic and subjective wellbeing factors in explaining individuals’ private pension participation and non-pension savings/investments. The findings show persistent ethnic and gender gaps, with Bangladeshi and Pakistani individuals faring worse than other ethnic groups, and women within such groups faring the worst. Factors indicating better socio-economic and subjective financial situation are associated with a greater likelihood of having a personal pension or expecting to use savings/investments in retirement. The paper critically discusses how current policies address the ethnic gaps in pension membership, and how such gaps can be addressed more effectively in the future.