• Men underestimate their life expectancy by 4 years, women by 7 years
  • Planning for 17 years leaves men £20k and women £35k short on modest pension goals
  • With average pots of £50k, many face a £70k gap by retirement.

 

New analysis reveals that men are likely to live four years longer than they expect, while women are underestimating their lifespan by a staggering seven years.

Building on BW’s At Retirement Reckoning report, which examined public perceptions of life expectancy, pension planning, and retirement readiness, the firm’s actuaries have now advanced the research by comparing these perceptions with proprietary life expectancy models refined using real-world pension scheme data and adjusted for distortions like the COVID-19 pandemic.

Most individuals expect to live until around age 82 – but actuarial models based on real pension scheme data show they’re likely to live significantly longer. For men, the gap is around four years: while they expect to live to 82, the reality is closer to 86. For women, the shortfall is even more dramatic. They also expect to reach 82, but in reality, many will live until 89 – underestimating their lifespan by a full seven years.

The results are sobering: the UK is facing a serious retirement readiness gap. And this misjudgment isn’t just a statistical footnote – it has major financial implications. If someone plans to draw £5,000 a year from their private pension (on top of the state pension) and assumes a 17-year retirement from age 65 to 82, they would aim to have saved around £85,000. But if they live to 86, as many men will, they’d need £105,000. For women likely to reach 89, the requirement jumps to £120,000. That’s a shortfall of £20,000 for men and £35,000 for women – assuming modest income expectations.

The situation becomes even more concerning when looking at women’s pension savings specifically. On average, women retire with significantly smaller pension pots than men. Many manage to save only around £50,000 by the time they retire. But if they end up needing £120,000 to sustain them through retirement, they face a £70,000 gap – leaving them dangerously exposed and potentially far more reliant on state support later in life.

The disparity in life expectancy between men and women is a key part of the problem. Men and women tend to assume they will live for roughly the same amount of time, but women typically outlive men by around three years. With longer lives and smaller savings, women face a uniquely challenging retirement landscape.

Even those with Defined Benefit (DB) pensions – widely seen as the most generous and stable form of retirement income – are not immune. While DB scheme members tend to live longer than average, often due to socio-economic advantages, the analysis shows they too are underestimating their longevity and under-planning their financial needs. The comfort of a DB scheme may be masking a deeper issue: nobody can plan well if they don’t understand what they’re planning for.

 

Jack Carmichael, Associate and Senior Longevity Actuary at independent consultancy BW, says: “The gap between expectations and reality on life expectancy is yet another seismic hurdle in the way of solving the gender pensions gap. Millions of savers are heading into retirement with unrealistic expectations and inadequate savings. Women in particular are facing a perfect storm: longer lives, smaller pension pots, and a far greater risk of running out of money.

“We do see women often increasing contributions in later life, presumably to catch up on shortfalls. But these contributions are generally not high enough. The earlier people can plan, educate themselves on life expectancy, and increase their contributions, the better.

“For older women who are facing this issue imminently, working longer, or returning to work if possible, would help to build up more retirement income and make it last for longer. Alternatively, for those lucky enough to have both a DB and DC pension, delaying taking one or considering annuities might be sensible. If there’s ever a turning point to consider financial advice, it’s now; an advisor can help set your DC income based on your personal realistic life expectancy, and the shape of your retirement, allowing for a varied phased approach from ‘go go’ to ‘slow go’ to ‘no go’, where care needs become critical.”

 

 

Methodology 

 

Barnett Waddingham commissioned Censuswide to survey 5,032 UK employees and self-employed people aged 18+, at least 3,000 of which are over 50 and all of whom plan to retire in their lifetime. An additional 548 respondents who didn’t plan to retire were asked why not. This survey was conducted in summer 2024.

The additional analysis was conducted in May 2025 using a bespoke life expectancy analysis methodology; this is available upon request. The financial impact analysis is as follows:

  • If individuals are saving for around £5,000 per annum of pension (above state pension)
  • And they only save for the amount they expect to live in retirement (c. 17 years for both men and women from age 65 to age 82)
  • Both men and women will look to have around £85,000 (£5,000 per annum x 17 years) in their pension pot at retirement age
  • If they actually live until their life expectancy (86 for men and 89 for women), then they will have needed to have saved broadly £105,000 for men and £120,000 for women
  • This would lead to a shortfall in their retirement savings of around £20,000 for men and £35,000 for women

Some sensitivities to the analysis include:

The gap would then be higher if individuals are targeting a higher income above state pension in retirement (for example, if they are targeting income of £10,000 per annum above state pension then the differences would increase to £40,000 for men and £70,000 for women).

If women only have the ability to save up to £50,000 in their pension pot before retirement (vs a man able to save the £85,000), the gap for women would increase to £70,000 and would mean the women relies on state benefits for a significantly longer proportion of their retirement than men.



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