Generating lifelong retirement income is a challenge—and one that’s not shared equally between men and women. With longer average life spans, women are often more at risk of not meeting their retirement goals. A longer life span and other factors can greatly affect women’s retirement readiness creating retirement hurdles for women.
Women often face unique challenges when it comes to planning for retirement.
As a result, many find they haven’t saved enough to support the kind of retirement they envision. But these challenges don’t have to derail your plans—they can easily be overcome with the proper support, resources, and planning.
Why Is Retirement Planning Different for Women?
There are numerous factors that can create obstacles for women planning for retirement. However, by recognizing these challenges and identifying meaningful steps to overcome them, women can confidently work toward a successful retirement.
Here are four hurdles that women often face when planning for retirement:
1. Longevity: Women tend to outlive men.
Women typically live longer than men. According to the Social Security Administration, today’s average 65-year-old man can expect to live until age 84; the average 65-year-old woman can expect to live until age 87.¹
Living a long and happy life is a blessing, but it’s one you’ll have to pay for: The extra time on this earth drives up the amount you’ll need to save for daily expenses and increases medical costs as your health inevitably deteriorates.
This difference also means that women must often make their retirement savings last longer. And for some, that may mean that they face living and managing all costs alone on one income for some years.
2. Life Priorities: Women often prioritize family.
While it’s not always the case, women often prioritize living expenses, family, debt, and real estate over their retirement savings. All the work that moms do for their families adds nothing to their retirement savings, and many of them opt to make it their single (though much-demanding) job.
According to the Department of Labor, about 30% of mothers (versus just 7.2% of fathers) with children under 18 do not participate in the labor force, meaning they have no income to call their own—and no way to save for their senior selves independently.²
3. Healthcare: Women face higher healthcare costs.
According to the Retiree Health Cost Index, a 65-year-old woman retiring today should expect to spend about $155,000 on healthcare, versus the $134,000 that a 65-year-old man can expect.³ The biggest driver of this difference is not only the longer lifespan of women, but also the fact that women see their doctor more often during their lifetimes to seek out preventive care.
Growing healthcare costs also factor into this expense. According to National Health Expenditure Projections, national health spending is projected to grow at an average of 5.5% per year over a 10-year period ending in 2027.⁴
4. Pay Gap: Men typically earn more than women.
For every dollar men earn, women only earn about $0.84,⁵ leaving them with less money to put aside for retirement. Over an entire career, that difference can really add up. And there’s a double whammy: Lower lifetime earnings also lead to lower Social Security benefits in retirement.
What to do About These Retirement Hurdles for Women
Taken together, these challenges can feel like an intimidating series of hurdles, but a successful retirement is possible for women with the right tactics.
Understanding their unique challenges when it comes to planning for retirement can help women take control of their financial health, now and in the future.
A variety of factors can result in women saving less for retirement than men, but starting early and consulting with a financial professional can help women take control of their financial future.
With careful planning and preparation, you can enjoy the retirement you’ve always dreamed of.
If you’re ready to get serious about planning for your retirement from federal service, register to attend a workshop today!
Sources:
¹”What Every Woman Should Know,” Social Security Administration
²Women’s Labor Force Participation Rates, Department of Labor
³2023 Milliman Retiree Health Cost Index
⁴National Health Expenditure Projections, Centers for Medicare & Medicaid Services
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