Women face more obstacles than men in achieving a financially secure retirement. That's the conclusion of a recent report based on an online survey of 6,372 workers conducted by the Harris Poll between August and October 2017 for TransAmerican Retirement Studies. [See "Here and Now: How Women Can Take Control of Their Retirement" by TransAmerica Retirement Studies]. For starters, women earn only 80.5% of the salary of men. They are also more likely to work part-time and to take time off for parenting and caregiving, all of which hinders their ability to save and reduces their future Social Security benefits.
Further, although 75% of men are offered a retirement plan, only 66% of women are offered one and their contributions average 7% of their salary, while men contribute an average of 10% of their salary, most likely due to their greater earnings. While it would be no surprise that men would have greater retirement savings under these circumstances, the differences are staggering. The median retirement savings for women was $42,000, but for men it was nearly three times this amount: $123,000! Moreover, while 38% of men had saved $250,000 or more, only 20% of women had done so. At the opposite end of the spectrum, 21% of women had saved less than $10,000 for retirement, but only 12% of men had saved less than this amount.
Let's also not forget that women live longer than men. Therefore, they have the additional challenge of making their smaller retirement savings last longer. So, what can women do to improve their odds of achieving a financially comfortable retirement? Here are TransAmerica's suggestions:
1. Start a conversation about retirement with family and friends. Apparently, few women do so.
2. Learn how your retirement savings are invested; 32% of women are unsure as to how their funds are invested as compared to 13% of men.
3. Get familiar with your partner's or spouse's retirement savings.
4. Learn about Social Security benefits.
5. Have a written retirement strategy. While 21% of men have done this, only 11% of women have done so.
6. Work with a financial advisor and take steps to remain healthy so you can work past age 65.
Obviously, these suggestions apply to men, as well. However, given women's relative lack of financial preparedness, they are all the more imperative for women to follow.
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