Women in the US today are better educated and have more opportunities than their mothers and grandmothers. But even though women have more opportunities than in the past, they face obstacles that can impact their potential for retirement savings. Lower pay than male counterparts, time off from their career to care for children or another family member, and longevity are all factors affecting a women’s ability to save and have enough to live off of in retirement.
Women are great savers when they are participating in a retirement savings plan such as a 401(k) or similar offering, but the participation rate is less for women than men, and they save 4% less than their male counterparts.
Women (56% of the current working) are more likely to ‘guess’ at their retirement income savings needs and believe that $500,000 is enough in retirement. Men are less likely to guess as reported in the 2017 Transamerica Center for Retirement Study and reportedly used a financial calculator to arrive at their retirement savings number.
Women participating in the study identified things that they felt would help them to save more, regardless of obstacles; having access to accurate information regarding saving and investing for retirement, greater tax incentives for participating, a financial advisor, and a greater sense of urgency to save.
Interestingly all women, and especially Baby Boomer women, expressed not knowing enough about social security benefits. Many cited concerns about Social Security not being available to them when they retire and worries over the retirement priorities of the President and Congress.
What can women do to overcome savings obstacles? Start by taking charge of YOUR financial future:
- Start saving and get into the ‘habit’ of saving each month
- Participate in a retirement plan at your employer, or another plan type if there isn’t one.
- Find an advisor you trust and work with them to develop a financial plan.
- Become involved in your family finances, not just trusting someone else to ‘take care of it.’
- Get educated about investing for retirement
- Have a backup plan; death, divorce, and being unable to work before retirement is a reality check
If you have concerns about the obstacles you may be facing regarding saving for retirement, contact our Las Vegas Financial Advisor office to have a conversation and develop a plan that meets your personal needs.