Women slightly less ready to retire than men
Although the differences are not great, “Retirement Revealed,” a new report from the ING Retirement Research Institute, concludes that men are more prepared to retire than women.
Men have more savings
Perhaps the most significant difference between male and female retirement readiness, according the the report, was in terms of savings. Of those who had savings, Men, on an average, had nearly 50 percent more. The average man had $149,000 stashed away. The typical woman, on the other hand, had about $108,000.
There have been many studies lately demonstrating how unprepared most Americans feel when it comes to retirement. While just more than half of men feel ready (58 percent), the number, according to the ING report, is lower still for women (44 percent).
Only a quarter of women surveyed said they had an investment plan to grow retirement income, contrasted with nearly a third of men (33 percent).
Motherhood and retirement
Motherhood is a particular challenge to women building a retirement plan. While the salaries of men and women are less divergent than they once were, men still out-earn women in almost every field. And while men do carry more of the responsibility of child-rearing than in the past, the fact is the bulk of the burden still falls mainly on women, who frequently spend significant periods outside of the workforce to give birth and raise children. That significantly reduces their social security benefits.
Here are some other statistics the study revealed about motherhood and how it affects retirement preparedness:
Sixty percent of mothers feel unprepared for retirement. Forty-six percent have no plan for how to get there. Only 65 percent are taking their full match from employer-sponsored retirement programs, such as 401(k)s. Forty-five percent have less than $25,000 in those employer-sponsored programs. Women with children at home had, on an average, only $88,000 in savings.
The study also looked at generational differences among women.
Eighty-six percent of women between the ages of 25 and 34 said they had “barriers” preventing them for saving, as opposed to women 35 and older, who cited “barriers” 74 percent of the time. Only 6 percent of younger women put extra money into savings, and 47 percent admitted to using extra money for entertainment purposes.
Of the women surveyed 50 and older, for whom retirement is not so far away, nearly half had never sat down to calculate how much they would need for retirement. Slightly less than a third had any investment plan to prepare for retirement.
Maliz Beams, CEO of ING U.S. Retirement, wrote:
“It is clear that many women — regardless of their age or life stage — must do more to save for their retirement. The combination of living longer and saving less can hamper a woman’s ability to reach her goals.”