As of 2017, women have made tremendous strides in closing the gender gap. However, the fact that a gender gap exists, led the Transamerica Center for Retirement Studies (TCRS) to examine the factors that cause women to become uniquely vulnerable in planning for retirement.
“Today’s women are better educated and enjoy career opportunities that our grandmothers’ generation could only dream about,” says Catherine Collinson, president of TCRS. “Nevertheless, women continue to encounter challenges including lower pay, time out of the workforce for parenting or caregiving, and longer life expectancies that all contribute to unique challenges in adequately saving for retirement.”
The 2017 study marks the 12th consecutive year that TCRS research showed women are at a greater risk of not achieving a financially secure retirement compared to men.
“Women continue to lag behind men in terms of saving and planning for retirement,” says Collinson. “It it is even more concerning that women statistically tend to live longer than men, thereby implying an even greater need for savings and preparations.”
TCRS releases the study at an opportune time. March is National Women’s History month and March 8 is International Women’s Day. Collinson says: “The goal of our research and outreach regarding women and retirement is two-fold: 1) to raise awareness of the retirement risks that women are facing, and 2) highlight opportunities where women can take greater control of their long-term financial security.”
Findings from the TCRS national survey of working women highlight that few have a high level of confidence about their future retirement. Only one in ten are “very confident” that they will be able to retire comfortably. At the same time, more than half are “guessing” at the amount they will need to save in order to feel secure in retirement.
Household retirement savings is $34,000 (estimated median) and more than two-thirds indicate that they have no back-up plan if forced into retirement sooner than expected. Four out of five are concerned that Social Security will not be available to them when they are ready to retire.
“The facts are startling and clear. women must begin taking greater control and gain an understanding of their true retirement outlook,” says Collinson. “By confronting challenges head-on, women can acquire essential knowledge about how to achieve financial security and create plans that can help mitigate risks and steer them on a course for financial security and a more positive outlook for their retirement ambitions.”
On the following pages, you will find ten facts that TCRS found about women and retirement that are aimed to raise awareness of retirement risks that women face:
Retirement confidence remains low for women compared to men. (Photo: Thinkstock)
Fact No. 1: Retirement confidence is low
Only 10 percent of women are “very confident” in their ability to fully retire with a comfortable lifestyle, compared to 19 percent of men. Nearly half of women (45 percent) are “not too confident” or “not at all confident” compared to only 32 percent of men who share those sentiments.
Fact No. 2: Many expect to retire after age 65 or not at all
Fifty-three percent of women plan to retire after age 65 (40 percent) or do not plan to retire (13 percent), a similar percentage to that of men (54 percent). One in four women expects to retire at age 65, and 22 percent expect to do so before age 65.