Women & Retirement: Facing the Issues

March is Women’s History Month and, because of that, we’d like to highlight some opportunities for women to manage their path towards retirement.

Just like a properly organized playbook for a big game, a great strategy will help nearly anyone through the difficulties they may face in both preparing for retirement and staying retired.

Women face real issues preparing for retirement and we’ve broken it down into a few main aspects facing women and their finances. Let’s dive in further to find out more of what women may face when retiring and how, with a concrete plan, retirement can be peaceful, exciting, and fulfilling.

 

Women May Earn Less Than Men During Their Working Years

It’s no secret that women may earn less than men, even if they are performing the same role.

What does this mean in retirement?

Because compound interest is the real power boost of a retirement plan, the fact that a woman’s earnings may be less than a man’s simply means that there is less available money to save in a 401k, IRA, or other investment vehicle.

This doesn’t mean that you can’t set goals and achieve them (Bill Belicheck-style), it just means that the path is a bit more arduous.

Is the wage gap affecting your retirement plans?

“Why does this happen?” You may be thinking. It can be due to actual discrimination, however, one of the greatest challenges women face when saving for retirement is also one of the greatest gifts they can give to others: caregiving.

Women tend to be the family caregivers. Leaving the workforce to tend to their family members has its consequences, including losing out on a salary and access to an employer-sponsored retirement plan, as well as years that would go toward accumulating credits to social security benefits.

In other words, things happen that are out of a woman’s control. Therefore, when assessing the retirement prospects of any woman, the correct moves all tend to maximize efficiency and opportunity.

 

Increased Life-Expectancy

Women’s earning power can provide less financial opportunity for earnings but their genetics is also a major concern when planning for retirement which means…Women Live Longer than Men. 

The World Health Organization estimates that women live (on average) six to eight years longer than men. Living longer means greater financial risks such as inflation, outliving your assets, experiencing the death of a spouse, and unexpected health costs.

Women simply need more resources to cover their longer retirement and prevent them from falling into poverty. In other words, a woman’s financial assets will have to be stretched thinner and over a much longer period of time in order to make ends meet after retiring.

Women may live longer on average and may earn less money, but that doesn’t mean a successful retirement isn’t just as possible. If you are looking to maintain a standard of life similar to your pre-retirement lifestyle, it’s all in the planning.

How has Covid-19 affected women and retirement?

Covid-19 

Because this blog is being published in 2021, we can’t ignore the pandemic.

As if the obstacles for women weren’t bad enough, the pandemic offers new wrinkles. Covid-19 has affected countless families, businesses, and livelihoods. Unfortunately for women, a vast majority either found themselves laid off or having to take an unspecified amount of time off to help their children learn virtually.

Now that things are slowly returning to normal, women are looking at a year of lost wages. That means that no money was going into their social security for retirement, no money going into employer-backed 401k accounts, and possibly no money into IRAs.

We’ve heard a lot of concern over stock portfolios, as well. Since the stocks took a “Covid-hit,” some people feel that their 401k is not looking as robust as it once was.

Lucky for those people (and anyone else investing), the stock market has always rebounded, throughout a 100+ year history and countless recessions and issues. Those that stayed with their retirement plans would have seen their investments sink to scary lows in March and April of 2020, only to have regained all that and more by early 2021.

Stock market volatility is not a new thing; the strategy for retirement has to be LONG-term, not what you see every day.

Think of the reason the Kansas City Chiefs signed Patrick Mahomes to one of the longest contracts in NFL history. They’re playing a long game in an industry that is typically known for their “win now” attitude and cutting expensive  players at the drop of a hat.

That same long-term strategy will defeat the “Covid-hit” to the market and set you up for amazing retirement success!

 

Conclusion

Let’s face it, retirement can look much different for a woman than it does for a man.

We aim to help everyone maximize their finances so that retirement can be relaxing, rewarding, and stress-free.

Whether your goal is to travel the world, see sporting events in iconic stadiums (maybe just ours), or buy a vacation home, taking the time to plan everything out will become your greatest asset in your journey to retirement and financial freedom.

The good news is that women can bulk up their finances for retirement, just like men. There are many financial tools and planning available that can really offer long-term assistance.

Knowledge is everything in terms of ensuring that a woman’s retirement is no different than a man’s.

When it comes down to it, a great retirement plan starts with organization and a savings plan. What you do with those savings, of course, is where the financial expertise comes in (let’s talk), but if you approach savings with a % of earnings strategy, you can leave your short-term financial concerns in the past and focus on a long-term strategy that wields compound interest to set you up for success.

Your outlook on retirement should never be dismal. It’s a time to look forward to. You’ve been working hard your entire life and you deserve a break!

It’s my job to help everyone plan for their best retired life. Women do face more uncertainty when it comes to retirement, but I’m here to help with that. I would love to chat and discuss some options with you. Call today so we can start you on your path to a comfortable retirement.

Lets chat about your personal goals

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