Discussions about pensions are really important for establishing financial security. However, these conversations are not the same for everyone. Within the Black community in the UK, there are unique challenges and circumstances that impact the topic of pensions. The theme for Black History Month this year is ‘Saluting our sisters’, which highlights the crucial role Black women have played in shaping history, inspiring change, and building communities. Research has shown the Black community faces inequalities when it comes to pensions and faces greater disadvantages within this group. In this blog, we aim to explore these differences and discuss what we can do to help.

1. Financial Inequalities

Over two million pensioners live in poverty in the UK. However, for those from Black ethnic groups the possibility of poverty is greater compared to White pensioners. Research has shown that 30% of the elderly Black community are living in poverty, whereas these figures are lower at 16% for older White people. This conveys the disparities between ethnic groups and the extent to which financial inequalities affect communities in the UK. Factors such as Covid-19 and the cost-of-living crisis has led to over half of minority ethnics saying that the pandemic exacerbated their financial stresses. This leads to a key reason preventing minorities from investing in their pension, as they’ve less spare income.

• Read more about Financial Inequalities on Age UK. (This link opens in a new window)

2. Pension Participation

Research into the Gender pension gap reveals that there are additional inequalities faced by Black women. 1.4 million women earn less than £100 a week through their state pension. Additionally, 21% of Black women don’t meet the threshold for auto-enrolment into a pension and are subsequently ineligible. This depicts the additional inequalities faced by Black women when it comes to pensions. The ethnic pension gap shows that only 23% of Black people in the UK have a pension and many worry about not having enough for retirement. The pension participation rates within the Black community shows the need for important changes and discussions.

• Learn more about Pension Participation. (This link opens in a new window)

3. Pension awareness

One of the top five reasons stopping minorities investing in a pension is that they don’t have enough knowledge. There’s a greater need for more accessible and open communications about pensions. Research has shown that 71% of minority ethnics want their pension provider to aid them in understanding their pension. Many want to know how their pension is invested and how it can help them. Making pension information more accessible is essential in driving pension knowledge. Respondents to Legal & General surveys have expressed that infographics help them to engage more and understand their pension. Financial advice from friends and family also impacts pensions awareness. Having conversations around pensions from people that you can relate to and have similar backgrounds to, resonates more with the listener. Encouraging these conversations is paramount to the wider engagement of pensions.

• Read the report for more information on Pension Awareness. (This link opens in a new window)

What can we do?

At Teachers’ Pensions, we want to have these discussions to recognise and reflect on what steps we can take to do better. It’s important that we’re able to have these conversations so that we’re able to help our members. We aim to educate our members about pensions and the Scheme in many ways.

We run regular online member training presentations that cover topics from starting out in the Scheme to planning retirement. We wanted to highlight this opportunity as there has been great feedback from these sessions. We have a range of videos that explain different topics in a quick and simple way, they can help you get to grips with setting up My Pension Online to understanding more about applying for retirement. Our resources pages are packed with factsheets and guides that can help you manage your teacher’s pension and pension planning. Finally, the Lifestyle hub has been created to provide members with support and resources during your teaching journey. From money management to financial wellbeing, we want to highlight the support available to you.

The topic of the Black community and pensions can be seen as difficult when highlighting some of the struggles they face. However, these discussions are important to help us move forward and recognise our role in helping. We’re committed to making pension information more accessible and are working towards improving pension knowledge for all our members. There are organisations that have helplines that can provide support and financial advice such as Age UK (This link opens in a new window). We’d encourage you to get in touch and remember that if you’re struggling, you’re not alone. Everyone should have a comfortable retirement and we’re striving for that reality!