While the wage gap between women and men in the U.S. is steadily improving, women tend not to have as much in retirement savings.1 New studies indicate that women are better at saving, and no more conservative than men when it comes to making growth investments, but other factors contribute to lagging retirement account balances.2 To begin with, women get paid 20% less than men.3 Women also live, on average, five years longer than men.4 Perhaps most significantly of all, women tend to be the ones who are removed from the workforce during their peak earning years to raise a family or become involved in other forms of caregiving.5 There is some good news, though: if you have missed out in the retirement savings department, a few key strategies are known to be effective in enabling you to catch up.
While these techniques do come with trade-offs, they can help you to live a more financially secure retirement. You should ideally work with a financial representative or other advisor to coordinate and maximize your retirement funds, but all of the steps are things you can initiate yourself.
For an optimal strategy that suits your own financial picture, you’ll probably want to consider getting professional financial advice. With a few adaptations, you may well be able to take steps that change your future retirement outlook for the better.
1 Sarah O'Brien, "Women save more than men for retirement: Study," CNBC, February 25, 2016
2 Chris Taylor, "Why women are better investors: study", Reuteurs, June 7, 2017
3 Kevin Miller, "The Simple Truth about the Gender Pay Gap", AAUW, September 28, 2017
4 Shervin Assari, "Why do women live longer than men?", World Economic Forum, March 14, 2017
5 Antonia Farzan, "You'll probably never make more money than you do in your 40s", Business Insider, July 15, 2015
6 Douglas Dubitsky, "6 Ways Women Can Catch Up On Retirement Savings", Forbes, June 8, 2016
7 Jim Borland, "2017 Brings New Changes to Full Retirement Age", Social Security Administration, January 6, 2017
8,10,11 U.S. Department of Labor, “Taking the Mystery out of Retirement Planning,” November 2015
9 Internal Revenue Service (IRS), “Retirement Topics - Catch-Up Contributions,” IRS.gov, October 26, 2015