Women and Retirement

Many Obstacles Confront Women as They Face Retirement

It’s easy to think that gender shouldn’t impact your financial planning – but it does. Women live longer and are more likely to stop working for a period of time to care for children or aging parents. Here are some more reasons women need to think differently about retirement:

  • Up to 75% of caregivers are women who spend more time out of the workplace caring for family members.1
  • Women who work reduced hours or part time are often not eligible to contribute to a retirement plan.
  • On average, women earn about 80 cents for every dollar earned by men.2
  • A 65-year-old woman can expect 13% higher health care costs than a man.1
  • Social Security benefits are 23% lower for women based on lower lifetime earnings and longer life expectancies.1

Women earn and save less

Women, who leave the workforce for periods of time to raise their children or care for an aging parent, may find that their retirement savings are impacted. They have spent less time in the workforce and their earnings  lag behind their male co-workers who stayed in the workforce continually. The result is that women may end up contributing less to their retirement plans and earning lower benefits from Social Security.3

According to the Insured Retirement Institute, it has translated into a 25 to 30% shortfall for women’s retirement savings compared to men’s savings.1

Taking charge of your retirement

These issues are difficult, but not impossible to overcome.

Understand your finances

Take a proactive role to find out about your current financial status, review your retirement accounts, take stock of your assets and check on your Social Security benefits.

Learn how much you will need to live in retirement

Determine the type of lifestyle you want to live and the expenses needed to maintain it. Then figure out how much income you will need while taking inflation and longevity into account.

Invest in your employer’s retirement plan

It is never too late to save for retirement so take advantage of the tax benefits of a retirement plan. Check with your employer to see if they offer matching contributions and a “catch-up” provision for savers over age 50.

Educate yourself about other investment options

Talk with a professional advisor to determine the best options for you based on your risk level and goals.

With the help of a financial advisor, you can develop a comprehensive program to help address these issues and help you plan for a comfortable retirement.