They’re afraid of outliving their savings and affording healthcare.

Women earn 80 percent of what men do, says a recent survey of 6,300 U.S. workers. That income disparity takes a toll on their retirement savings outlook.

Fifty-five percent of women fear outliving their retirement savings and investments, compared to 49 percent of men, according to Transamerica Center for Retirement Studies (TCRS).

“Despite the progress made in recent decades in terms of higher levels of educational attainment and career opportunities, women continue to encounter financial risks that put them at a distinct disadvantage compared to men with regard to retirement security,” says Catherine Collinson, president of TCRS. “Women continue to earn less than men and, therefore, have less income available to save.”

And that’s not all that makes retirement so stressful for women.

Women’s retirement stress

Aside from dread of out-living savings and investments, women have other retirement quandaries plaguing them.

  • 53 percent are concerned Social Security is depleting or won’t exist in the future.
  • 48 percent believe they won’t afford the basic financial needs to take care of their families.
  • 47 percent stress about their health declining, and needing long-term care.
  • 42 percent worry they won’t have access to adequate and affordable healthcare.

Women’s concerns with retirement savings have pushed many to believe working longer is the only answer to their problems.

More than half (53 percent) expect to work past the age of 65, or don’t plan to retire. Another 54 percent say they will at least work part-time during retirement, according to the survey. And the main reasons cited? Financial-related reasons – with 85 percent saying so.

But another 71 percent say “healthy-aging” is a reason to continue working. Many believe that having a purpose, keeping their brains alert and staying active will keep them healthy for the long haul.

“Women’s dreams of retirement are overshadowed by financial and health-related fears,” Collinson says. “Today’s women envision extending their working lives beyond traditional retirement age and an active retirement that balances time for leisure, family and friends, and some form of continued work.”

Financial gender gaps

Women face unique financial circumstances, compared to men, according to Collinson. Circumstances, like taking care of children, or sick or elderly family members. When women need to take time off from their careers they earn less over their lifetime and sacrificing opportunities to workplace retirement savings benefits, like a 401(k).

“Women often take time out of the workforce for parenting or caregiving, foregoing income and benefits altogether,” Collinson says. “Statistically speaking, women live longer than men, thereby necessitating that they save for a longer retirement.”

Collinson continues: “In combination, these factors can have a compounding effect that severely impedes a woman’s ability to successfully achieve a secure retirement.”

There are many factors adding up to the reason women’s grim outlook on retirement savings and investments. One reason — as Debt.com has previously reported — there is another financial-related gender gap, other than the “pay gap.”

Not only are women earning less than their male counterparts, they’re investing their income at lower rates as well. This could be adding to the fear that TCRS uncovered in its recent survey. Many women are unaware this gap even exists.

Almost half (45 percent) of women don’t know there is an investment gap, and that they may miss out on up to $1 million during the course of their careers, according to female-focused investing site Ellevest. Ellevest has tips to close the investment gap that can help women save for retirement.

Collinson feels it’s not only on women to end retirement savings disparity.

“Women have made tremendous progress in recent decades. Yet there is more work to be done in terms of overcoming inequalities and helping women achieve long-term financial security,” Collinson says. “This endeavor must be a shared responsibility among individuals, employers, industry and policymakers.”

 

 

Meet the Author

Joe Pye

Joe Pye

Associate editor

Pye is the associate editor of Debt.com.

Retirement

health, income, money management

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Article last modified on April 25, 2018 Published by Debt.com, LLC . Mobile users may also access the AMP Version: Women Fear Retirement More Than Men - AMP.