Women are likely to live longer and thus likely to need more money during retirement, but since they make less, save less, and are less confident about having a comfortable retirement, the odds are not in their favor.
According to a research report from the Transamerica Center on Retirement Studies, women face a precarious path to retirement. The report, based on findings from TCRS’ 17th Annual Transamerica Retirement Survey of Workers and released in conjunction with National Women’s History Month, finds that few women have a high level of confidence about their future retirement. Only 1 in 10 are “very confident” they will be able to retire comfortably.
In addition, more than half of women are just guessing at how much money they’ll need to feel secure once they retire; while they are likely to need more money than men thanks to a longer projected lifespan (and the greater likelihood to need more money to cover medical bills), they should be saving more money to meet those projected needs. But they’re guessing about how much that figure should be.
The report finds women estimate they’ll need to have saved a median amount of $500,000 to feel financially secure when they retire, which is the same estimate men come up with. However, 56 percent of women who have an estimate say they “guessed” at the amount, with just 8 percent having used a calculator or completed a worksheet to come up with their estimate.
Men, on the other hand, are far less likely to have guessed, with just 40 percent doing so, and more likely to have used a calculator or completed a worksheet (16 percent).
Women’s estimated median household retirement savings is just $34,000, median emergency savings is only $2,000 and more than two-thirds of women indicate that they have no backup plan if forced into retirement sooner than expected. So it’s probably not surprising that 50 percent plan to work after they retire and 53 percent plan to retire after age 65 (40 percent) or not at all (13 percent) — especially since 82 percent are concerned that Social Security will not be there for them when they are ready to retire.
In fact, some are proactively taking steps to keep working past age 65. Sixty-two percent say they’re staying healthy, with slightly more than half — 54 percent — are focused on performing well at their current job and slightly less than half — 42 percent — are keeping their job skills up to date.
It’s not as if women aren’t aware of the unique risks retirement presents for them, however. The number one retirement priority 59 percent of women have for the new president and Congress, the study finds, is fully funding Social Security by implementing reforms so that it can continue to pay future generations of retirees.