Women face plenty of obstacles when it comes to saving for retirement.

Women have come a long way in the workforce, but that doesn’t mean they don’t have to overcome unique obstacles that men don’t typically face. From gender pay gaps and time off for caregiving – two factors that affect women’s lifetime earnings – to needing more retirement savings due to the likelihood of living longer than men, women must jump some high hurdles on the way to a comfortable retirement.

As a result, only 20% of women surveyed said they feel “very confident” that they’ll be able to fully retire and live comfortably in retirement, according to Retirement Security: A Compendium of Findings About U.S. Workers, a report from Transamerica Center for Retirement Studies (TCRS).

1. Women live longer on average than men

The current life expectancy for women in the U.S. is around 82 years, compared to the male life expectancy of 77 years, according to the United States Census Bureau. By 2030, the life expectancy for women is about 84 years old, compared to 80 years old for men. That means women need to save more for retirement to make savings last.

Living longer also means that women have a greater chance of needing some form of long-term care, a costly expense not typically covered by Medicare.

Find out: 6 Shocking Facts About Women and Retirement

2. Women more likely to survive a spouse

The fact that women typically live longer than men increases their risk of widowhood, which can reduce household income. Retired widows, especially those over the age of 80, experience a “marked decline” in income after their spouse dies, according to “Still Shortchanged: An Update on Women’s Retirement Preparedness,” a report by the National Institute on Retirement Security (NIRS).

If the widowed spouse is still employed, the reduction in household income may hinder her ability to contribute to retirement savings. If she’s already retired, she may have to return to work at least part-time just to get by and could be more likely to deplete retirement savings.

Find out: 6 Ways COVID-19 Puts Women’s Retirement at Risk

3. Women’s lifetime earnings less than men

Women are more likely than men to work part-time, and even when a woman works full-time for her full career, she’s still likely to earn less than men, according to the NIRS report.

“Women are also much more likely to take time out of the labor force to provide caregiving, either to their children, elderly parents, or an ailing spouse, according to the NIRS report. “This time spent out of the labor force negatively impacts women’s ability to save for retirement.”

4. Women eligible for less in Social Security benefits

Social security retirement benefits comprise about 50% of retirement income for married women, 59% for widowed women who live alone and around 53% for women who are divorced or never married, according to the NIRS report.

However, in 2019, the median earnings for women ages 15-64 who worked full-time for 50 weeks or more were only $45,000, compared to 54,000 for men, according to the Social Security Administration (SSA). And the average Social Security income received by women 65 and older was $13,505, compared to $17,374 for men.

5. Caregiving affects retirement fund contributions

Because women are more likely than men to take time off from work due to caregiving for children or aging parents, they may not be able to make consistent contributions to an employer-sponsored 401(k) or similar employee retirement plan. Women may even have to make early withdrawals (paying a penalty) to help pay for an elderly parent’s care.

Find out: 6 Alternatives to Quitting Your Job to Care for an Aging Parent

6. Women are more at risk for Alzheimer’s disease

Nearly two-thirds of Americans living with Alzheimer’s are women – and a woman’s lifetime risk of developing Alzheimer’s at age 65 is 1 in 5, according to the Alzheimer’s Association. In fact, women in their 60s are more than twice as likely to develop Alzheimer’s as they are over the rest of their lives to develop breast cancer.

Long-term care costs due to Alzheimer’s, another form of dementia or other illnesses can wipe out retirement savings fast. In 2020, the national annual median cost for an assisted living facility was $51,000 and the annual median for a private room in a nursing home was nearly $106,000, according to the Genworth 2020 Cost of Care Survey.

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About the Author

Deb Hipp

Deb Hipp

Deb Hipp is a full-time freelance writer based in Kansas City, Mo. Deb went from being unable to get approved for a credit card or loan 20 years ago to having excellent credit today and becoming a homeowner. Deb learned her lessons about money the hard way. Now she wants to share them to help you pay down debt, fix your credit and quit being broke all the time. Deb's personal finance and credit articles have been published at Credit Karma and The Huffington Post.

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