Longer life for American women (8% longer than men on average) is accompanied by a number of additional costs and financial constraints that can lead to greater financial challenges in retirement. As of 2009, women age 65+ had significantly lower annual retirement incomes than men, $21,500 vs. $37,500. American women are more likely to experience retirement alone since many never marry or are widowed or divorced. Women spend more on health care since they pay greater attention to their health and tend to have less adequate insurance. Women provide more long-term care to others (parents, spouses), costing them in lost wages, Social Security benefits and pensions. They are more likely to need long-term care themselves with a lifetime cost of $124,000, nearly three times that of men ($44,000).
More than half of the women (54% vs. 44% of men) report that they are very or somewhat concerned about outliving their retirement resources. Of women who were at least somewhat confident about their ability to live comfortably in retirement, 66% attributed this to having a guaranteed stream of income (70% of males concurred). Of those not confident, 61% said they lacked sufficient savings to last their anticipated lifetime (58% of males agreed).
The study recommends the following:
- Take Charge - Women who take responsibility for their retirement are in a better position to reduce the specific risks of being female. They should be aware of gender-longevity differences and their implications and seek, not generic, but gender-specific information and advice. Couples should work together on information-gathering and calculations. Note to men: If your spouse/partner are inclined to assume less responsibility for decision making in your household (or if one of you tend to dominate the planning), commit to equal involvement through shared information gathering and calculations.
- Plan for Contingencies - Have a Plan B, including calculations and details for various contingencies. Be sure they account for expenses like long-term care and the health costs related to a woman’s longer life. Plan for emergencies; don’t defer for “if and when they happen.” Consider the implications of “cashing out” resources prematurely, like retirement plan benefits, guaranteed income joint-and-survivor options and Social Security benefits. Note to men: Be sure your contingency plan accounts for the needs of your partner and that benefits and insurance account for your spouse’s life expectancy, assuring guaranteed lifetime income for both of you.
- Do Your Own Math - Calculating your needs and resources is the key to planning and saving enough assets. Make sure your income and assets will last your expected lifetime. Use gender-specific estimates and calculations.
- Act Now - The most affirmative action is timely action. Take a deep breath, consider your specific concerns and start planning with a variety of scenarios in mind. Act now, as if your (later) life depends on it. It does.
- Note to men: If you haven't taken into account the extra long-life of your spouse of partner in your retirement planning, don't delay. Now is the time to take action and to make any necessary adjustments.
The report includes a number of resources women can tap, including Financial Planning for Women: Retirement Calculator (AARP), What Today’s Woman Needs to Know and Do: The New Retirement Journey (MetLife Mature Market Institute), What Every Woman Should Know (Social Security Administration, US Department of Health and Human Services) and WISER’s Financial Planning Workbook: A Collection of Worksheets and Factsheets to Help You Take Control of Your Finances.
Pages: 1 · 2
More Articles
- Facing Financial Ruin as Costs Soar for Elder Care
- High Inflation and the Outlook for Monetary Policy By Federal Reserve Governor Michelle W. Bowman
- GAO* Report on Retirement Security: Older Women Report Facing a Financially Uncertain Future
- Supreme Court Surprises The Public in LGBTQ Ruling: What is Sex Discrimination?
- Grab That Museum Pass! Could Arts Engagement Have Protective Associations With Survival?
- Investing Through the Next Recession: It is Best to Use the Volatility of Financial Markets to Your Advantage
- GAO: A Comprehensive Re-evaluation Needed to Better Promote Future Retirement Security
- What Does Your House Really Cost and Can You Afford It In Retirement?
- Another Turbulent Day on the Market: Three Reasons to Do Nothing
- Listen to What the Concerned Scientists Union States: Hurricane Michael Threatened Gulf Coast Homes and Military Bases: Update: Thomson Reuters Foundation Film: Home Beyond the Water