It’s no secret that women face significant hurdles to achieving a financially healthy retirement. While married women face these hurdles in a partnership, divorced women find themselves solely responsible for saving, strategizing, and maximizing their retirement. Not only do divorced women face challenges that their married counterparts do not, but all women face greater challenges compared to men.
Let’s start with longevity. The Social Security Administration reports that a man reaching age 65 today can expect to live, on average, until age 84.3. For women, that average life expectancy is 86.6. Women live longer than men; therefore, their retirements are expected to last longer. Quite simply – women need to have more money saved.
And then there is the very real factor of less income. Women still earn an average of 77 cents for every dollar earned by men. Earning less means not only do women have less money available to set aside for retirement, but also that their Social Security benefits will be significantly lower than what their male counterparts will receive.
On average, women have less savings. When you earn less, you save less. But even when women save aggressively, they often put other goals ahead of their own retirements, such as their child’s college tuition.
So what can women do about this very real challenge?
First, educate yourself – Devote time and effort to learning the basics of personal financial management and investing. Spending time “doing your homework” can pay off nicely down the road.
Do it now – women need to begin their retirement savings as soon as possible. If you are in the divorce process, make sure your divorce team is negotiating terms that will serve you well in your retirement.
As always, save as much as you can. It’s important to think of retirement savings as a commitment. Prioritize needs over wants in your spending, and make no mistake: Retirement savings is an absolute need.
With a commitment to education, good planning, disciplined savings, and professional guidance, there is good reason for you to expect a financially secure retirement. On the other hand, without those things, there is good reason for concern. Make your retirement savings a priority, and not a cause for worry.
